Refunding water charges ‘avoids another election’

Refunding water charges was the only choice the Government had in order to avoid a general election, Housing Minister Eoghan Murphy has said.

He was speaking after it was confirmed that almost 1m homeowners will receive the full amount of water charges paid by the end of the year.

As revealed yesterday by the Irish Examiner, the refunds will be paid by cheque at a cost of €178m to the taxpayer, with another €114m needed to cover the shortfall in Irish Water funding caused by the suspension of charges.

Asked about the wisdom of refunding the charges, Mr Murphy made it clear he would have preferred not to have to do it, but it was the only option left to the Government or it would have caused a general election.

“I have to put this refunds process in place to fund those customers and also then have an engagement with the minister for finance,” he said.

“We’d rather not do that. We’d rather we have a consistent funding stream for water service users into Irish Water, not just for conservation purposes but also because we think it makes sense economically. We can’t do that now.”

Mr Murphy then criticised Opposition politicians for wanting it both ways in terms of demanding refunds as well as wanting more money in October’s budget.

“I think over the coming weeks, as we approach the budget, you’re going to hear people, politicians, talking about spending extra money in different areas. Those same politicians who made this decision to force this decision and cut off the funding stream which is what we didn’t want to do.

“But that’s something we have to face because we decided it’s in the best interest of the people that we have a government. We did not want to go down the path of other countries of having another election, maybe 13 months without a government, when all the crises that we’re facing and managing would be even worse. So we had to do that for the best interests of the people to have that in place, I’m happy we did that at the time,” he added.

Mr Murphy confirmed that the cost for refunding the charges will be €173m with a further €5m for administering the refunds.

“We’re putting in an additional €1m as a contingency and, of course, as there won’t be charges paid for the rest of this year we’ve had to allocate an additional €114m this year to Irish Water so they can continue to operate. So it’s almost, just under €300m,” the minister said.

Irish Water has confirmed that named account holders will be the ones refunded and it is expected that almost all customers will be refunded before the end of the year.

Exceptional cases will be processed in early 2018, according to Mr Murphy’s department.

To avoid fraud, to ensure refunds go directly to the account holder, and to make the process as efficient as possible, customers will be refunded by cheque.

Customers do not need to do anything at this stage. Irish Water will run an information campaign that will inform customers on the next steps shortly.

There is no application process involved. Customers only need to contact Irish Water if their details require updating.

Refunds explained

Q: Why are customers being refunded?

A: Last April, the Oireachtas Committee on Water recommended equity of treatment for those who have paid and not paid water charges. The Oireachtas has approved the committee’s report and the Government is moving to implement that recommendation.

Q: Who will be repaid?

A: Named account holders of Irish Water who paid their charges will be refunded.

Q: When and how will people get their money back?

A: Irish Water says almost all customers will be refunded by cheque before the end of the year. Exceptional cases will be processed in the first quarter of next year.

Q: Do people need to do anything now?

A: No. Irish Water will run an information campaign shortly that will inform customers on the next steps. There is no application process involved. Customers only need to contact Irish Water if their details require updating, like if the person who paid the money has since died or you have moved house.

Q: Will the Water Conservation Grant be deducted from refunds?

A: No. The grant was a standalone, separate grant for all households whether Irish Water customers or not. Its aim was to support conservation and was distinct from domestic water charges. Therefore, it is not being deducted.

Q: How much will this cost?

A: €173m for the refunds, plus admin costs of about €5m. The Government is putting in an additional €1m as a contingency. As there won’t be charges paid for the rest of this year, an extra €114m has been allocated to Irish Water to allow it to operate. So the total cost is likely to be just under €300m.