Leaders' Questions

When I asked the Taoiseach a number of questions yesterday about Irish Water, following Deputy Fergus O'Dowd's comments that it has been an unmitigated disaster, an abject failure and much more, the Taoiseach responded that, in his view, Deputy O'Dowd was simply saying it had teething problems. That response illustrated how out of touch the Taoiseach is with the situation on the ground and with people's attitudes. Deputy O'Dowd was certainly right in saying there is an intense dislike of the entire process and that people feel angry and intimidated.

The fundamental aspect that is absent from the water rates regime that is being introduced via Irish Water and via the regulator is the ability to pay principle. Deputy O'Dowd said yesterday that as Minister of State, he pleaded with his senior Minister and with other Government members that there be exemptions for disadvantaged groups including, in particular, the unemployed. There is absolutely no protection under this regime for the more than 370,000 people on the live register. The households benefits package does not include those who are out of work. Second, there is no protection for low-income earners, of whom we have the second highest proportion in the OECD. Consumption taxes are by their nature regressive, but nothing has been built into this charging regime to protect low-income workers, one in five of whom, we are told, are earning below the living wage. Third, we have families with three, four and five adults who will face very significant bills. The estimated charge is €380 for a three-adult family, €482 for a four-adult household, and €584 where there are five adults in the home. We are talking here about dependent young people in full-time education or unemployed. Those families are being screwed by this regime. The estimates are extraordinarily high, with no mitigation whatsoever. To add insult to injury, those on boil water notices will receive a bill and will have to pay for the water-out element of the regime, notwithstanding the significant expenditure they have faced as a result of having to boil water.

Will the Taoiseach amend the legislation to enshrine at its heart an ability to pay clause? That would have an impact in terms of the intense dislike of the process to which Deputy O'Dowd referred and in terms of people feeling angry and intimidated.

Deputy Martin raised this issue yesterday. I notice that he has not yet submitted his budgetary proposals, in which I understand there is a €3.4 billion black hole.

The Taoiseach will not give us the costings.

Deputy Martin has some neck to come in here and say what he is saying. His party in government proposed the introduction of water charges at a minimum charge of €400 per household with no allowances.

That is not true.

It is true.

(Interruptions).

The Taoiseach, without interruption. Deputy Martin is well able to answer for himself.

Deputy Martin subsequently rejected that proposal and is now opposed to the introduction of water charges. If he were in Government, however, he would have to do it. There is a €3.4 billion hole in his party's budgetary estimates and he needs to explain what he proposes to do regarding the €4 billion adjustment he has objected to in recent years.

(Interruptions).

I remind Deputies on that side of the House that Deputy Martin is a big boy and does not need their help at all.

The country is coming out of a recession. I do not accept the comments from the former Minister of State who piloted the relevant Bill through the House that Irish Water is as he says. I do accept, as everybody does, that some of the issues that were raised in the initial stages of the establishment of Irish Water were not as they should be. Clearly, there was not the clarity of explanation and understanding given to people as to what this was about. What it is about is putting in place one of the largest and most fundamental entities in the history of our State to provide proper water structures and proper water quality for households, businesses and industry. Yes, there is a contribution to be made. Deputy Martin's colleagues in Sinn Féin do not want any domestic water charges and are putting it back on the public bill at a cost of €850 million in taxes or whatever without any explanation.

This issue must be dealt with. We cannot go on paying €1.2 billion per year for the production of water, with 40% of it leaking away, thousands of people on boil water notices, dozens of treatment works not up to standard and kilometres by the thousand of inferior pipe work. All of that has to be dealt with, and it never was dealt with because the Deputy and his party, for the main part, during its time in government over the past 25 years, did not deal with it. Irish Water will be able to borrow to invest and fix these problems, and a contribution is being asked of people. That is why the Government gave a direction to the regulator such that there would be an allowance per household and per child, with extra to be given for those living alone. The 340,000 people on the household benefits package will receive extra allowances, and those with particular medical needs will have a cap put on what they pay.

I recognise that any charge that is put on people is not easy to accept, but this is an issue that simply must be dealt with. As the Deputy well knows, in huge areas of the country people have been paying for water for 50 years, by way of regional water schemes and whatever else. Where water goes out, if it goes into a public sewer, that must be paid for because it has to be treated. If it goes into a septic tank for which there is a charge and a monitoring system, it will not have to be paid for because it does not go back into the public system. There are many multiples of thousands of households in that situation. It is not nice to have to pay a charge. It has not been easy for any member of the Government in the past three years to have to stand up and impose charges in order to get us out of the catastrophe in which the Deputy's party left us. I am glad to see that economic commentators are now projecting growth for this year and next of between 4.5% and 5% and in the following years in the mid-threes. These are positive things.

The Government will consider very carefully the question of the structure of payments, namely, how payments can be made and when they can be made. We must help people to understand that water is an absolutely essential commodity and something not to be wasted. As I said, 40% of it is leaking away every day. If the Deputy filled his oil tank in Cork every Monday only to find that 40% of it was gone by Wednesday, what would he say? He would say the problem must be fixed. Everybody can contribute to fixing the problems with our water supply, in one way or another. There are allowances built in for the categories of people who need them most.

(Interruptions).

Before I call Deputy Martin, I wish to point out that I get complaints into my office every day that the same people are causing a disturbance in the Chamber. If they think they are impressing the public, they are not. People know all about them. I ask those individuals to allow the Member who has the floor to speak.

It is typical of the Taoiseach that he never answers the questions he is asked in this House but instead makes false assertions and makes it up as he goes along. He is incorrect on a specific point. There never was a proposal for a €400 charge in any document produced by my party.

Deputies

There was.

The central point I am trying to make, and which the Taoiseach deliberately refuses to deal with, was set out clearly by the previous Government in the EU-IMF agreement and the national recovery plan, namely, that water charges would be introduced on the basis of "ensuring that lower-income groups remain supported". The Taoiseach has not done that in the regime his Government is introducing. Deputy O'Dowd - who, as Minister of State, introduced the legislation - said as much yesterday.

I asked the Taoiseach about the situation for the 370,000 people who are out of work. The household benefits package does not cover the unemployed. Will he answer my question? Does he think the unemployed are in a position to afford these charges? Will he answer my question about the nearly €400 charge for a family with three adults, which may well include children in full-time education, with the additional costs that involves? That charge will be nearly €500 for a four-adult family. I am not making these figures up; they were given out by the regulator. It is incomprehensible to me that households on boil water notice should have to pay anything at all, given that their water is not fit for consumption.

That is the central point. The Nevin Economic Research Institute has done work on this, which we have read. We have done our research in order to be constructive. We believe those categories merit a substantive response and not the false assertions and the usual stuff the Taoiseach goes on with. Can the Taoiseach specifically speak to the unemployed in terms of water charges? Can he speak to the families with children over 18 years of age who are going to college or who are unemployed? Will he address the questions asked of him, because he has neglected them? In fairness to Deputy O'Dowd, out of office he has had the honesty to say that a poverty analysis was done by the Department but it has never been published. Why has it not been published? The Taoiseach rammed all this through the Dáil before last Christmas with no debate and when some of these issues-----

Sorry, Deputy, we are way over time. Thank you.

What about Deputy Martin's time in office?

The former Minister of State, Deputy O'Dowd, brought this Bill through the House with the specific Government direction to put in place Irish Water to deal with a situation that was neglected for years. We were one of the most inferior countries in terms of the quality and supply of water-----

That is not true.

-----with so many different systems. Deputy Martin comes into the House every week with a barrage. He, on behalf of his party, put forward a €400 charge with no allowances.

(Interruptions).

The Government set directions for the regulator-----

(Interruptions).

Sorry, would Deputies please stay quiet?

-----of an average charge of €240 per household, an allowance per household and an allowance per child. That means a person living alone will have 40% of his or her water needs provided by the allowance-----

I asked about the unemployed.

-----which means his or her average charge is approximately 50 cent per day. There are 411,000 recipients of the household benefits package, including pensioners, carers and those with a disability. They will receive an extra €100 per year to assist them.

Deputy Martin never wants to know about what he left behind. Some 18,000 people on public water supplies-----

-----have a boil water notice or other restrictions in place. The Deputy left that situation behind him. The Environmental Protection Agency reports that remedial action is required on 16% of supplies for almost 1 million people, including large schemes, such as the Dublin city supply and the Cork city supply. They are badly in need of proper remedial treatment.

There are significant constraints in this city and the Deputy knows what happened in Ballymore Eustace last year put this city on the edge. I got many complaints from restaurant owners, business people and consumers, asking what we were doing about the water. There has never been enough money to invest in it and to fix it. Some 40% of water is leaking through pipes.

We have put in allowances for the different categories. Some 36% of water treatment plants do not meet the needs. Of course, it is not easy on any category, in particular on the unemployed and those with families. Children who are over 18 are treated as adults if they stay or work at home. That is a difficulty but everybody must make a contribution and the Government has tried to make this as fair, equitable and affordable as possible. It is about dealing with the problem which has been around for so long and which, like so many other issues, was swept under the carpet by Deputy Martin's Administration and those of his party.

I am sure the viewers will be interested to hear Fine Gael, the Labour Party and Fianna Fáil swapping back and forth on the way the Government is approaching this whole issue of water charges because it is a Fianna Fáil proposition. The Taoiseach asked yesterday about Sinn Féin's budget, which I sent to him this morning. I hope he has had the chance to read it.

It contains proposals to rebuild the economy, renew society and to repair the damage done to the community by the Government and by Fianna Fáil before it. It contains a proposal, which I commend to the Taoiseach, to lift the burden on low and middle income households by scrapping domestic water charges. It tells him how to do this and how to pay for it.

However, I want to concentrate on another crisis, the crisis in housing. Our budget proposals include a proposal to build 6,000 new homes over the next 18 months and it tells the Taoiseach how this should be funded. I do not know if the Taoiseach has noticed but there are 20,000 applications for housing in Dublin City Council, which is an increase of 3,000 since last year. The real number is higher but this particular Dublin council list verifies that all of these citizens have had their need for housing established by the council. More than one third are living in overcrowded conditions or have particular medical or welfare needs. Some 1,136 applicants are homeless in this city, and that is repeated throughout this State.

In addition to the main waiting list, 5,645 tenants are already living in social housing but are seeking to transfer because one quarter of them are living in overcrowded conditions and others need to move out of flats because they do not have wheelchair access. Some 100 of these people need to change their accommodation because of changed family circumstances. In my constituency, there are more than 5,000 on the housing list.

What is the Government's plan to deal with this ongoing crisis? The ESRI has called on the Government to make a major investment in social housing in the next week's budget instead of making the tax cuts it has been promising. Will the Taoiseach accept our proposition? If he has not had the chance to read it, I would commend it to him. Will he accept the proposition from the ESRI to invest in social housing instead of making the tax cuts the Government has been proposing?

I thank Deputy Adams. In regard to his comment on the water charges, I understand Sinn Féin proposes that domestic water charges should be abolished and that this would then go back on the public pay bill. This would impose a charge of €850 million to be raised. I understand from its submission that it has left aside something like €300 million, leaving a hole in that particular area of €550 million, which it would need to explain.

I also understand that Sinn Féin wants to increase employers' PRSI by 5% and increase the top rate of income tax by 7%. That is an is an additional 12 percentage point tax on jobs. I am not sure if Sinn Féin is serious about this because if it is, it would drive every employer and every potential investor out of the country in terms of the creation of jobs. That would leave us with Sinn Féin's proposition of a 48% income tax rate, raising €365 million three years in a row. By implementing a 7% tax increase three times, it would raise the top income tax rate to more than 62%, leaving an incredible total tax rate of 73% when USC and PRSI are included. If it wants to close down the country, that is the kind of economics it should be proceeding with because it is not credible or real.

Deputy Adams raised a very important issue about housing. I want him to understand that the Government will respond to this, alongside the budget next week and in the time ahead. Clearly, there is a serious supply and demand issue, in particular in the greater Dublin area. The issue of homelessness, of those who have been put out of apartments and houses because of rent increases and of the demand for housing - a demand which is rising very rapidly - is a cause of great concern. The recently published planning Bill, being dealt with by the Minister for the Environment, Community and Local Government, provides for a vacant site levy of 3% to encourage development, a new Part 5 to deliver 4,000 additional units by 2020, changes to development contributions and the use it or lose it approach to planning permissions. These are all designed to make an impact on the construction sector.

Deputy Adams knows contractors will not build houses unless it is profitable for them to do so. The Government is acutely aware of the fact we need an income stream for contractors to build and for buyers to purchase and a planning process in place to allow for that to happen.

There are many thousands of houses for which planning permission has been approved under the old regulations, some of them in the wrong place, but we will look at the incentives that might be brought in to make an impact on how this can happen.

The Government will publish shortly a five-year social housing strategy, which is the key commitment of the Construction 2020 document that we published. The need for social housing based on last year's assessment is very well documented and accepted by everyone. The Housing Agency has admitted that to meet housing need over the next five years, we need 35,000 housing units to be provided. The Government's challenge is to meet social housing need in an innovative and cost-effective manner. The ESRI has put forward its view, as some of the others have as well. The Government has to make a decision on this, and the strategy being finalised will take into account budget 2015 and will be published by the Minister, Deputy Kelly, very shortly after the budget. Deputy Adams should know that we are acutely conscious of it, as are the people looking for housing who will be accommodated in social housing. Government will produce its specific strategy and plan, alongside the budget, in the very near future taking into account all these very valid submissions.

We made a very valid submission which the Taoiseach misrepresented, deliberately and maliciously, in what he said. All our propositions have been costed. The Taoiseach might not like them because he thinks the people should serve the economy whereas those of us on this side of the House believe in a republican vision where the economy serves the people. That means those who are most in need.

I raised the issue of housing not to indulge in the Taoiseach's Walter Mitty-type approach to these serious propositions but to bring to his attention that there is a huge housing crisis. There are 89,000 households in housing need. There are also 76,000 families in receipt of rent supplement. Riddle me this, Taoiseach. Failing to house these families costs the State €30 million in emergency accommodation. That is his brand of economics. We spend €500 million annually in subsidising private rents. Who are the rent racketeers? Who are the landlords? Does cronyism have anything to do with the failure of this Government to put in rent controls because it has refused to put rent controls in place?

Thank you, Deputy. We are over time.

The cost of renting has risen by more than one quarter in Dublin alone. The average rent for accommodation in the city is in excess of €900 a month. That is the reality. When we bring forward propositions, the Taoiseach might not like them. He might disagree with them or want to take issue with them-----

Would you put your question, Deputy?

-----but he should at least give them the serious consideration that we put into them on behalf of those we represent, and others we do not represent, in putting them forward.

The Taoiseach did not answer my question, which is, and this is not a Sinn Féin proposition, if he will heed the call of the ESRI to move away from tax cuts and to invest in social housing. Will he accept its proposition, and will he give those families in need a very clear indication that he will do that?

I accept the principle referred to by the ESRI and many others that there is a need to meet social housing demand. Clearly, this is an issue Government has reflected upon in terms of Construction 2020-----

A Deputy

Stop reflecting and start doing.

-----and the new planning Bill and the issues that pertain in terms of Part V, incentivising contractors and builders-----

Incentivising builders.

-----to be able to get back to the business of providing houses.

Have we learned nothing?

We hope that 5,000 homes will be added to the social housing stock this year.

You should be doing your job.

For the Deputy's information, the Government made available €68 million to the local authorities as a construction initiative.

You said there was no housing emergency.

Would you stay quiet please? Thank you.

(Interruptions).

Would you stay quiet?

That funding will restart the local housing authority scheme directly. We put forward €15 million to restore up to 1,800 vacant units, particularly here in Dublin, designed to reduce pressure on the housing lists. There is no reason many of these units have been boarded up for years when they could be turned into comfortable warm homes for people to live in.

You did not provide the funding to do it.

You have been saying that for two years.

The €68 million injection to the local authorities will provide almost 500 homes over the next two years. They have to be built.

Why not 6,000?

Thirty-five million euro was also brought forward this year for people who have a disability-----

Five thousand more will be joining the list.

-----people without a home and the elderly. There has been a €30 million investment in 2014 to improve the energy efficiency of local authority housing-----

You cut €70 million from the budget from the start. Will you stop?

-----and a €10 million investment this year to kick-start the resolution on the remaining unfinished housing development. NAMA and the Government will respond in parallel to the budget to deal with the question of social housing.

The answer is "No". The Taoiseach says "No".

The issue raised by the ESRI, which has been raised by many other housing agencies, is very clear. There is a real demand. No matter who is in government, even the Deputy's party, they would have to have contractors and builders provide blocks, foundations and houses. It takes time to build them.

The Taoiseach has had four years.

(Interruptions).

The Deputy, with his fantasy economics, cannot put these houses on the ground just like that.

It took an election for you to-----

We will deal with it next week and the week after.

That is totally pathetic, Taoiseach.

But real, Gerry.

Yesterday, the former Minister, Deputy Fergus O'Dowd, expressed the view that Irish Water has not communicated its message properly. That was followed later in the day by the Minister of State, Deputy Dara Murphy, stating that Irish Water could have done better to get its message across. Given the amount of our money that has been spent by Irish Water on public relations, that should be surprising, but what it fails to acknowledge is that it is not the delivery of the message that is at the heart of the problem. It is the substance of the message that people have a problem with. No one, regardless of how good a communicator they are, can convince families with adult children living at home, some of whom are full-time students, those on jobseeker's payments or the more than 30% of people who cannot pay their utility bills that they will have the ability to pay another bill. They are already struggling, and they know that daily struggle better than anyone. Who is selling the message? It appears there is a virtual golden circle of personnel who are linked from one controversial project to the next. It strikes many of us as odd that the former Dublin city manager and now head of Irish Water, who had a close relationship with RPS consultants during the Poolbeg incinerator fiasco, should have two directors of RPS-----

Sorry, you cannot go into that.

-----as his closest allies in Irish Water in the form of the head of asset management and the head of communications.

Sorry, you cannot make allegations of that nature in the House.

They are not allegations. They are facts.

No. You are not going to do it.

(Interruptions).

A Deputy

They are not allegations. They are facts.

They are not facts. It is not in accordance with Standing Orders.

It is also odd that the former Minister, Phil Hogan's Department turned down Siemens' offer to foot the bill for water meter installation, choosing instead to opt for the far more expensive option offered by Siteserv, a company operated by the person who had the great fortune to obtain the second mobile licence in this country, Denis O'Brien.

Given the striking similarity of the team playing the game, how on earth does the Taoiseach expect people to trust Irish Water? Does he accept that the very large cohort of the population who are stretched to breaking point will not be able to pay another utility bill when the ability to pay is not at the centre of this issue? Yesterday, the Taoiseach spoke about teething problems. Has he considered that Irish Water is the teething problem?

I accept from Deputy Murphy that any charge imposed on people is always difficult to deal with and difficult to accept. That is why, under the structure of Irish Water, the policy directions were given by Government to the regulator and are being implemented by the regulator. Appropriate allowances for the different categories of people that I have outlined on a number of occasions will apply.

In respect of the Irish Water entity, Deputy Murphy will be aware that this will become Ervia, which is an amalgamation of Irish Water and Bord Gáis, where a completely independent analysis of the competencies and the specialties required to run a major entity like this will apply. Those discussions will take place about the creation of Ervia very shortly.

When was that announced?

This is a massive organisation which has a fundamental and important part to play in the economy for the future.

Without mentioning some of the issues the Deputy referred to it is a question of putting in place an entity that can borrow off the Government balance sheet to invest in infrastructure and provide quality water for people and for business and deal with the leaks, the treatment works and boil water notices and so on. Yes, of course, it is always difficult when a new charge is imposed. That is accepted.

What if someone cannot pay?

There is a need for a contribution from people across the country with a view to dealing with this problem which has been neglected for years.

The Taoiseach said Irish Water is a huge organisation. That is what frightens people. It what they feel they are paying for. The one group that the citizens did not expect to create a super quango was Fine Gael, when one considers what was said in the run up to the last general election. This does not address the issue of ability to pay. If one earns €188 a week on jobseeker’s payment it is a challenge to exist. If one is trying to keep a few young adults in college and has bills to pay it is a challenge. The Taoiseach repeatedly mentions the figure of €800 million but the take is projected to be €370 million next year. That reinforces the point people make that the bills will be substantially higher than is predicted. They are very fearful. It is the only utility people will pay for and not consume because they will be responsible for a leak in a pipe between the meter and the house, except for the first leak. That frightens them. They do not know what they are likely to face.

The former Minister of State, Deputy O’Dowd said he went to the Taoiseach because he was concerned about ability to pay. What did the Taoiseach say to him? Did he give him a hearing? Did the Government consider the ability to pay in respect of those categories?

The Minister of State, Deputy Kevin Humphreys, will be gone by teatime.

There are several things the Deputy needs to bear in mind. The water regulator has determined that the average bill will be less than €240 per year, has confirmed that 80% of all bills will be less than €24 per month, given the allowances already laid out, and ordered that there be a reduction in the cost base of Irish Water of €170 million by 2016, that is, a reduction of 8% and includes a substantial element of pay. The household allowance will cover 40% of the water supplied to a person who lives alone. That person will pay approximately 50 cent per day for water, which is approximately €138 per year. Over 400,000 recipients of the household benefit package will get an extra €100 a year for that. In many cases of special medical requirements, where a lot of water must be used for particular complaints and circumstances, that will be capped.

The regulator sets the conditions.

The Government sets the parameters for the regulator.

What if a person cannot pay?

He is determined that the average bill will be less than €240 and that 80% of bills will be less than €24 per month.