Irish Water protesters outside the GPO in Dublin on June 20, 2015
This morning, the Irish Independent‘s environment editor Paul Melia reports that Irish Water will need approximately €300million from the State to make up the cost of suspending water charges.
He also reported that Irish Water is to rerun its public information campaign to “convince” people to pay.
Mr Melia spoke to Katie Hannon earlier on RTÉ’s Today with Seán O’Rourke show.
From their discussion.
Katie Hannon: “According to documents seen by the Irish Independent, as the phrase goes, the Government has been informed that Irish Water is going to require almost €300million to compensate for the suspension of water charges. The Department of Housing, Planning, Community and Local Government said the shortfall would be made up for in 2016 but haven’t announced their intentions for the next two years. Additionally, Irish Water believes that it is going to have to launch an enormous and costly campaign to convince the public of the need to pay for water services if charges are re-introduced after March of next year when the current period of suspension will have run its course. Paul Melia, environment correspondent for the Irish Independent has been writing about this and he joins me on the line now. Paul, welcome.”
Paul Melia: “Thank you.”
Hannon: “Almost €300million is what you’re saying the cost will be upfront. Can you break that figure down for me?”
Melia: “Certainly, these are financial projections that were provided by Irish Water to the department in June and what they’re saying is that, for 2016, there’s going to be a revenue shortfall of €123million or so. Now this figure isn’t new, we know this figure and that’s basically because charges are going to be suspended, have been suspended for the second half of the year. So, Irish Water says this is the cash shortfall we’re going to have. Now, the Government has said that they will make up that difference and, you might recall, there was a water conservation grant last year which cost €110million. This shortfall of €123million – there’s a gap there of somewhere of €13million, up to €20million that the Exchequer will be able for this year. So that’s all been addressed and sorted out. There’s no funding issue for this year. Where it gets interesting is that Irish Water has come up with two scenarios. A scenario if billing returns next year and a scenario of no billing returns. And what they have said to the department is: if billing resumes from the second quarter of next year, which is expected, or sorry, that’s when a decision will be made, there will still be a revenue shortfall of about €125million now this is because there will be no billing for the first three months, so there’s about €65million or so missing there. And then, also, the balance is made up of they believe that people just won’t pay, that they’re going to have to go back and re-engage with householders and say to them: ‘look, we’re Irish Water, this is the job that we have to do and this is how we have to pay for it’. So, their public information campaign starts all over again.”
Hannon: “And tell me Paul, before I let you go any further, remind people how much has already been spent on convincing people that they need to pay for water?”
Melia: “Well I mean there’s been two, certainly in May, there was a report, Irish Water had spent about €350,000 on outside public relations, this was on top of their fully-staffed press office which I think has three people in it. And then there was an expensive advertising campaign last year as well which talked about basically how water came from the clouds to the tap essentially, that cost about €650,000 or so. So there’s about €1million all in, there’s probably more than that. But that’s certainly, more or less, what’s been spent to date. So, they’re talking about rerunning a lot of that stuff again. If the charges come back in…
Hannon: “Of course, just to stop you there again, ‘if’ is a very big if there, isn’t it? Because certainly the political temperature would indicate that that is a very big if.”
Melia: “It certainly is. I mean I think more than 100 TDs in the Dáil are opposed to water charges in any way shape or form and this expert commission that the Government has established, that’s meant to look at the long-term funding model for Irish Water, in other words, how will the day-to-day operations, which cost in or around €1billion a year, plus the capital expenditure programme be funded. They’re due to report back at the end of March of next year. And then they will recommendations with the Dáil committee. That Dáil committee then will examine that and it will make recommendations to the Dáil itself and it will be put to a vote. So TDs will ultimately decide whether or not domestic water charges are reintroduced or whether they’re abolished permanently. As you said, the political temperature at this stage certainly is that they’re not going to be reintroduced.
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