Irish Water Q&A: Charges face watery grave as parties play for time

After protracted negotiations between the two major parties many questions remain over the future of Irish Water and the water charging regime, writes Fiachra Ó Cionnaith

What’s the Irish Water deal?

A full 61 days after the general election, Enda Kenny and Micheál Martin’s parties have agreed to suspend charges for up to 18 months, a move effectively ending water charges.

Under the deal, which is key to preventing a second election, Fine Gael will suspend water charges for an initial nine months while an independent commission examines the utility’s future.

After this period, an Oireachtas committee will review its findings for nine more months, during which time charges will also be suspended.

However, this committee will not be tied to the commission’s recommendations and, if it has the backing of the Dáil in a later vote, may draw other conclusions, including potentially scrapping charges.

Fine Gael says that after this 18-month period, water charges in some form will return alongside significant allowances that will lower costs substantially and a metering system.

It also says Irish Water will continue, and claims this is a victory for the party.

However, senior Fianna Fáil figures and some Fine Gael back-benchers have privately said suspending charges for 18 months means charges will not return in any real form.

Crucially, in order to reintroduce water charges and end the suspension a Dáil vote would have to take place which would be near impossible to get passed.

So what happens now?

A lot of talk, for starters.

Yesterday saw the Dáil finally hold a lengthy Irish Water debate, during which all parties repeated views which have been widely aired over the past two years. However, key moves are also taking place.

Fine Gael and Fianna Fáil’s parliamentary parties — namely their TDs and senators — each met privately to discuss the deal and what it means to them, a key step towards the agreement behind signed.

Independents considered central to forming a minority government will also have their say over the coming days, before a likely government formation next week. This deal will mean your next Irish Water bill will become obsolete.

EU officials are likely to also contact government soon to express their formal concern charges are being suspended.

However, while acting Environment Minister Alan Kelly yesterday told the Dáil that Brussels will hit Ireland with significant fines, EU sources have previously told the Irish Examiner this will just be threatened and will not happen because the EU is prepared to allow a suspension on condition charges are re-introduced.

Is this deal effectively the end of Irish Water and water charges?

Yes.

Fine Gael insists the fact the utility will remain in place and that charges will return in 18 months time means Irish Water is not dead.

However, in reality even its own TDs accept this is not the case and that the controversial group will become little more than a shadow of what it once was.

While the utility will stumble on through the 18 month suspension and there is a commitment to continue charges in some form, in reality by the end of next year any fees will be drastically different to what we have now.

With an election looming at that stage, it can be assumed the current Irish Water quango will find it difficult to survive another ballot.

The first part of a deal is a commission. What is it being asked to examine?

The independent commission will examine Irish Water’s charges system, whether a national utility is needed, how a metering system can be set up and what waivers or allowances should be introduced once charges cease to be suspended. It will also review how to fund badly-needed water service reforms and how to resolve issues for people who have and have not already paid their bills.

It should be noted all of these issues could and perhaps should have been decided over the past 61 days during government formation talks. As ever, passing the buck to a commission is a politician’s best friend.

An Oireachtas committee will follow this commission. What will it do?

Once the independent commission concludes its work — the terms of reference for which still have to be worked out — it will pass on its findings to a yet to be set up Oireachtas committee of TDs and senators early next year.

This committee which, it is rumoured, Taoiseach Mr Kenny wants Greens leader Eamon Ryan to chair, will have the right to make further recommendations and they will go to the Dáil for a vote.

The fact a second election sometime in late 2017 or 2018 will be on committee’s members minds will also play a role.

If I haven’t paid to date, what happens to me?

This is a very important question. Fine Gael’s Jobs Minister Richard Bruton and Fianna Fáil’s health spokesperson Billy Kelleher both told RTÉ Radio’s Morning Ireland anyone who has not paid their bills to date will still have to reach into their pockets once the 18-month suspension ends.

This is because the bills to date remain legal charges which must be paid.

But realistically, until the commission and Oireachtas committee concludes its work in 18 months time, it can be safely assumed non-payers will not have to do anything.

If I’ve paid all my bills to date, what happens to me?

An equally interesting question.

Mr Bruton also said if charges end bill payers will have to be refunded, a position Mr Kelleher mirrored, while there has been some talk about a tax rebate for payers.

Nothing will happen for 18 months because only a suspension and not a scrappage will be in place.

However, anyone who has paid the legal charges to date will demand costly refunds from the State given what has just happened — yet another financial headache for a new government.

How can we trust anything that’s been agreed?

In five words: the threat of an election.

Fine Gael has been forced to cut a deal to stay in power, for now. Similarly, Fianna Fáil has given its main rival a significant bloody nose over a high-profile issue.

With neither party in favour of a second election based on the water charges issue, both will live with the deal and allow the plan to be progressed.

If charges are suspended, how will Irish Water be funded?

This has yet to be clarified.

The most likely scenario is that available exchequer funds will be re-routed to water services to help address sewage, leaking and pipe problems.

Money, of course, does not grow on trees, meaning these funds will be taken from other areas — potentially including health, housing, and education — an issue which is the dirty secret of the whole water charges affair.

Who are the winners and losers?

Fine Gael negotiator and Agriculture Minister Simon Coveney insisted on Tuesday night the deal is “not a cave-in”, but in reality this is what it is. In order to stay in power, Mr Kenny’s party has been forced into a major Irish Water climbdown.

While the deal does mean it can remain in government and that water charges and a utility will officially still be in place in 18 months time, the image of Fine Gael caving in means it is difficult to see it as anything other than the loser in the fight. Fianna Fáil is, for now, the political winner as it can rightly claim to have won a major populist concession by freezing charges.

However, with an election likely soon after this freeze ends — and Sinn Féin and the hard-left continuing to call for the scrapping of the utility and charges — the victory may be temporary if it has to return to the ballots arguing that some form of fee system is still required.

For Micheál Martin, this was just round one in a 12 round bout.

READ MORE: No refunds for people who have already paid bills

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