Irish Water is facing a tidal wave of new debt as its staff prepare demands for a pay increase expected to cost the beleaguered company an extra €2m a year.
The State company has been given consent to borrow a further €550m on top of some €300m in existing debts. A staggering figure of €850m in debts is likely to rise to €1bn.
The staff demand for a pay rise is not unexpected, as a seven-year pay freeze imposed when the utility was established is due to expire in January. A SIPTU union official confirmed a pay rise demand of 2.5pc will be lodged, which is similar to the 2pc across-the-board pay rises agreed with State companies Coillte and ESB.
The pay-hike demand and burgeoning debt mountain comes at a time when less than half of the country's homes have paid their water bills.
Environment Minister Alan Kelly revealed he has given consent for Irish Water to borrow a further €550m from commercial banks.
But the minister is refusing to state the interest rates on the new borrowings, claiming commercial sensitivity reasons.
Some of the utility's financial woes stem from the decision by the Government to alter the financial model on which the company's funding was based, when it slashed water bills to gain more public support.
"The Government's need to hide the true cost of Irish Water's loans is further evidence of the fact that this super quango is a colossal failure," said Fianna Fail's Barry Cowen.
"We are now in a situation where Irish Water is running at a massive loss and heading towards €1bn in debt, without investing a single extra cent in our water infrastructure above and beyond what was already being spent," said Mr Cowen, his party's environment spokesperson.
"The minister's refusal to disclose the interest rates on these huge loans is extremely worrying. It's difficult to escape the conclusion that Irish Water is paying above the odds and costing the taxpayer even more.
"And the cost of borrowing is likely to rocket further as commercial lenders witness the low level of compliance from customers," he said.
"All of this proves that our water infrastructure should have been left in the hands of local authorities and all the money that's been wasted in setting up a useless, expensive super quango should have been invested in water infrastructure at a local level.
"Instead, we are left with the worst of both worlds - water meters without water conservation, water charges without water investment and a water company without customers.
"It is time for the Government to look at the stark reality and put an end to this expensive project before it causes further damage," he said.