Irish Water ruling 'embarrassing' for Government, Noonan admits

By David Raleigh

The Minister for Finance has admitted a ruling by Eurostat, that the cost of Irish Water must remain on the Government's balance sheet, is "embarrassing" and "controversial" for the government.

However, even though the cost of Irish Water will remain on the national balance sheet following the ruling in Brussels, Minister Michael Noonan insisted that it will not affect the Government's Budget plans.

Speaking on Limerick's Live 95FM, Minister Noonan said: "While the announcement is embarrassing, and is going to cause more controversy around Irish Water, in terms of the Budget position, it doesn't reduce my space to give modest extra spending increases through Brendan Howlin, and to give reasonable tax reductions on personal taxes.

"I still have the space of €1.2bn to €1.5bn.

"Whether it's on balance sheet or off balance sheet, it's the same amount of money. All that's in question is how the spend is accounted for," he said.

Minister Noonan said the Government had already planned for the Eurostat ruling which he described as a "prudent" Government decision.

"When I was making out the forecast for the October budget and for the next five years, back in April, in the 'Spring Statement', we acted very prudently and we decided that the decision could go against Ireland, so we kept Irish Water on the balance sheet, so it makes no difference to our Budget plans."

"We have the same amount of money available in the Budget as we predicted in April. There's no difference there."

"Where the difference is, is that if they had made a decision to take it off balance sheet, our deficit would have been a bit lower at the end of the year, but we have predicted a deficit of 2.3% and that stands, because we included Irish Water's spend on balance sheet and we have included it in the numbers right out to 2020."

"But that was at a time when the Government finances weren't as good as they are now.

"Things have improved very rapidly over the last 18 months and this year, in tax terms, were €1.4bn better than we thought we would be last October when I brought the budget in," Minister Noonan added.

"There's going to be controversy, there's no doubt about that and the controversy has started already."

"But, the point about it is, it doesn't change the necessity of having clean water in the country; it doesn't change the necessity to stop 17 towns pouring raw sewage into their local rivers and into their local harbour; and it doesn't stop people some people getting water and lead pipes; it doesn't stop the problem of 40% of the water leaking through the ground," he said.

"We took the (financial) hit back in April, so it doesn't change anything now," he reiterated.

Fianna Fáil's Barry Cowen says the government should call an election and face the music:

"Who is accountable, who is responsible for bringing us to this crossroads?" he asked.

"Whom is going to take the fall for this disaster? Because as far as I can see, the whole of Government is responsible and the whole of Government need to say to the Irish public and need to put themselves before the Irish public for re-election as soon as possible and let this be to the forefront of any such debate that takes place."

More on this topic

Update: Irish Water working to remove remaining lead pipes from water network

Housing Minister accused of delaying 2016 bill to prevent privatisation of Irish Water

Irish Water works ‘pose threat to Ring of Kerry rock carvings’

Farmers told to follow best practice as pesticides found in public water

More in this Section

Minister rules out suspending NAMA work pending report into sale of NI loans

Study looking at gender diversity in surgery “an important message for the HSE"

Government deferred Local Property Tax review for political reasons, says FF

Garda worry over rising speeding and drink driving


This is why you really should go to sleep and wake up at the same time every day

Ask Audrey: My neighours are sound-proofing their bedroom - does that make them pervs?

How Ireland's only female executioner got the job

Scene and heard: This week's entertainment news

More From The Irish Examiner