North's water charges may be deferred, says Robinson

Consumers in the North facing a winter of rising fuel costs could be spared water charges, First Minister Peter Robinson said tonight.

Consumers in the North facing a winter of rising fuel costs could be spared water charges, First Minister Peter Robinson said tonight.

His comment comes a day after households in the North were hit with a 30% hike in electricity bills and a jump of nearly 20% in gas prices.

Tonight Mr Robinson responded to the growing anger regarding the increase in domestic bills by suggesting the proposed water tax be reconsidered.

It was recommended that water charges would be phased in for consumers from next year, but the First Minister said Government might have to continue to carry the financial burden.

Mr Robinson said: "In the present conditions with rising bills I believe that fresh consideration must be given to the timing and phasing of the introduction of domestic water charges.

"To make such a deferral possible will place significant pressure on our budget and may require careful consideration of existing allocations, but it is not credible to place any greater burden on our citizens in the present dire global economic circumstances."

His lifeline to consumers came after it emerged that the North was unlikely to benefit from a £1bn (€1.25bn) aid package announced by British prime minister Gordon Brown to help households fight rising fuel costs.

Stormont officials said few of the new measures would immediately benefit the North, but argued schemes to help with the impact of winter had already been introduced, while further measures on fuel poverty were possible in the future.

The North will be able to access an enhanced cold weather payment, but it is understood it will only come into force under extreme weather conditions.

There was a welcome, however, for the news from the Energy Saving Trust that new grant aid was available for insulating homes.

Chief executive of the North's Consumer Council Eleanor Gill said: "The Consumer Council welcomed today's statement from First Minister Peter Robinson that the timing and phasing of the introduction of water charges should be re-considered as a clear sign that he is in touch with and listening to the concerns of consumers as they face into a difficult winter with the soaring cost of living.

"Consumers here will greet this news with a sigh of relief."

In a further development today, the North's utility regulator Iain Osborne told a Stormont committee he had saved consumers £15m (€18.8m) in electricity and gas bills.

However, he sparked controversy by repeating his claim the price rises were unavoidable and in the long-term interests of consumers.

Mr Osborne gave evidence today to the Assembly's Enterprise, Trade and Investment committee.

"The announcements yesterday are clearly regrettable and are clearly going to have a serious impact on many people in Northern Ireland," he said.

"We consider the increases are justified, not in terms of some kind of trade-off in the interest of consumers against the companies, but justified in respect of the long as well as the short term interests of consumers.

"The increases would have been bigger had it not been for our careful diligent regulatory work over the last year or two.

"We follow a process in agreeing the increases which we think is very defensible.

"We consider this is a very transparent and open process, the outcome is clearly regrettable, for the citizens of Northern Ireland, just as it is for a lot of other people in Britain and in the Republic of Ireland who are facing similar challenges."

Mr Osborne revealed under questioning from committee chair Mark Durkan (SDLP, Foyle) that only two of his organisation's seven member board lived in the North and so faced the prospect of paying the rising bills.

Mr Durkan added: "I don't think it's much consolation or compensation to consumers who are feeling real pain at the minute to hear about their long term interests being safeguarded.

"It is not their long term interests that is vexing, worrying and stressing families at the minute."

Deputy chair Jennifer McCann (Sinn Féin, Belfast West) also said she was surprised to hear the regulator argue that the rises were in the long term interests of the public.

"It is the short term effects of this that is going to hurt people," she said, repeating fears poorer customers will have to choose between fuel and food.

Challenged by the DUP's Simon Hamilton and Ulster Unionist Alan McFarland, Mr Osborne outlined the reasons behind the dramatic jump in prices.

He said the North could not be fairly compared to Britain, which enjoyed lowers prices, but which he said effectively operated in a different type of market.

He said the North's industry needed to be modernised and invested in over time.

The regulator also said falling world oil prices did not translate into cheaper electricity, while gas prices were more expensive than had been expected.

Mr Osborne said: "We stand for consumers in this situation, it's a really difficult situation this winter.

"We made sure there are no extra profits because of these price rises. We have taken money out of the companies, £15m (€18.8m), and we have given that to consumers.

"It's in the longterm interests of consumers, we need to have a robust industry to make the investment so that we keep a secure and cost effective system."

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