Irish Water costs - An affront to all who paid for reform

The establishment of Irish Water, after years of debate and denial and the introduction of domestic water charges, was to have been one of our great modernising projects.

It was to have been a considered response to years of neglect and mismanagement. It was to have been a flagship, yes-we-can innovation and it is not overstating the case to suggest that Irish Water was to have been an ESB for its time. Irish Water was to have been a stepping stone away from our murky, nudge-nudge, leaky past towards a better organised and accountable place. In so many ways it came to symbolise what we needed to do to insulate this society from the whims of localism and the idea that under-resourced local authorities might develop and sustain water systems capable of meeting today’s and tomorrow’s needs.

It, just like the deferred universal health insurance scheme in another sphere, was to have been a framework for streamlined delivery of essential services. The organisation was to have been an exemplary project, one that would show we are capable of deep reform. So much for that well-intentioned but unfortuantely misplaced idealism. As weekend Sunday Business Post reports show, Irish Water seems to have become another opportunity for the untouchables to add a few more carriages to the gravy train.

A report commissioned by the water regulator from London-based consultants NERA found that Irish Water’s projected running costs for the next two years — estimated at €1.9bn — are more than twice the average costs of water companies in England or Wales. They are 2.6 times Scottish companies’ costs. Even allowing for setup costs, how can this be?

NERA pointed to the disparity in what Irish Water spends on wages and suggested that the figure was “high” in comparison to British counterpart. Almost 30% — 29% — of Irish Water’s running costs go on wages. That figure is 10.5% in England and Wales, 11.6% in the North, and 21.9% in Scotland. Add the challenging assessment of the ESRI’s John FitzGerald that Irish Water is hugley overstaffed into the mix and an all too familar picture of carry-on-as-you-are emerges. Prof FitzGerald suggested that about 1,700 people were needed to run our water services but 4,300 are employed. This, suggested Prof FitzGerald, will unnecessarily add €1.7bn to the organisation’s wage bill.

What an affront this is to people, who despite loud encouragement not to do so, paid their water charges long before any deadline was reached. What a kick in the teeth for those who recognised that change was necessary and funded it at a time of great economic difficulty. When challenged about this polticians will dodge and say that Irish Water is an independent organisation and contractural obligations mean that they really can’t do anything. That feeble response just won’t wash this time and foreceful intervention is needed. If this does not happen then the old, well-worn heartbreaker — the more things change the more they stay the same — can be trotted out again. What a pity and what a lost opportunity that would represent. And what a blow to the integrity of our politics.