There are currently 4,300 local authority staff working in water services. Claims made in recent days by Professor John FitzGerald of the ESRI that this number can be reduced to 1,700 in a few years have no basis. He did not substantiate his claim or outline the basis for his figure.
hen asked on RTE's 'Prime Time', he simply responded that he "was not sticking to that figure".
Making wild assertions of this nature is irresponsible, in particular for an economist, and especially as the new utility seeks to embed new relationships with stakeholders.
If anyone is unsure how wild Professor FitzGerald's claims are, let's take Scottish Water (SW) as a comparison. It serves 2.4 million households and 159,000 businesses, compared with the customer base of 1.6 million households and 220,000 businesses that Irish Water will serve. Last year, SW employed 3,540 staff, 11 years after a single utility was established.
As Irish Water moves towards a full utility model, and greater efficiencies are demanded, the number of staff employed will inevitably decline.
Local authority staff currently working in water services may be reassigned to other areas of activity. They are not "water staff". It is worth noting that overall numbers employed in local authorities have fallen by over 25pc in the last five years. Irish Water is due to achieve savings of €2bn between now and 2021. With water services costing approximately €1bn a year, such a saving is considerable. History can be instructive in this regard: In 1925, the government embarked on one of the biggest infrastructural projects in its history with the construction of the Ardnacrusha hydroelectric plant. The proposed Shannon Scheme divided public opinion at the time over its cost and scale and even its perceived implications for foreign relations.
Four years later, the project was completed. The newly-established ESB took control of the scheme, paving the way for Ireland's electrification. Few dispute its lasting social and economic benefits. Ardnacrusha was critical to our earliest economic development.
Almost 90 years on, the Government has embarked on another major national project to strengthen the country's infrastructure. Water services need to be delivered more efficiently. Unacceptably high levels of leakage at 40pc need to be tackled.
Our water and wastewater infrastructure need extra investment if we are to achieve security of quality water supply and to protect our waters. That is why the Government has established a national utility to replace a system with 34 water services authorities. In parallel, we are replacing the current, unsustainable funding model for water services with one in which the 'user pays' principle will apply. Domestic water charges will form part of this. They will be based on metered usage, which the Government believes is the fairest way to charge, and that approach is supported by the OECD. Otherwise, taxes would have to be increased and/or other public services, such as health and education, would have to be cut to fund the investment required.
Yet, unlike 90 years ago and the Ardnacrusha project, the Government is not starting from a blank canvas. It has set up Irish Water against a backdrop of more than 100 years' experience of water services in local authorities.
Throughout this period, local authority staff have operated and managed water assets with great dedication and expertise. It would not be feasible to reform without taking the strongest parts of the past. Indeed, Professor FitzGerald in his report to my Department in 2012 acknowledged that: "Obviously a substantial number of existing staff may be needed by the new company, not least to preserve some 'local knowledge'."
Well I can assure Professor FitzGerald that through the service level agreements (SLAs) between Irish Water and local authorities, there will be a smooth transition of responsibility for water services functions. The SLAs are dynamic agreements, driven by change. Their transformation agenda involves specific measures aimed at achieving a full utility model by 2017. Agreements will be reviewed and annual service plans, which form part of the SLAs, will contain performance targets that will be assessed. If there is significant failure, there are provisions to terminate the SLA.
By placing responsibility for water services and infrastructure in the hands of one utility, we can ensure water is provided more efficiently and the considerable problem of water leakage is addressed. By funding water services through Irish Water, borrowing on capital markets, we can end historic underinvestment in water infrastructure. By securing water supply, we can maintain Ireland's position as an attractive location for water intensive industries such as ICT, pharma-chem and agri-food.
Irish Water will ultimately give us more water capacity for jobs, good public health and much better quality in terms of environmental compliance. These objectives will be achieved with maximum efficiency.
PHIL HOGAN IS MINISTER FOR THE ENVIRONMENT, COMMUNITY AND LOCAL GOVERNMENT