Seanad Éireann debate -
Thursday, 27 May 2004

Vol. 176 No. 18

Water and Sewerage Costs.

Mr. P. Burke

I welcome the Minister of State, Deputy Noel Ahern, to the House and thank him for addressing this matter. I have raised it because a number of boards of management have told me recently that national and secondary schools and third level colleges are paying different charges for water in different parts of the country. In many cases, especially in certain areas, a huge burden is being placed on boards of management to raise the necessary funds to provide water at their schools.

As the Minister of State well knows, new sewerage charges will be introduced shortly and therefore the boards of management, irrespective of the types of schools they run, will have to pay both water and sewerage charges. The Government is now paving the way for public private partnerships and design, build and operate schemes. When these are in place, a capital charge and a running charge will be imposed on businesses and all non-domestic users, including the different types of schools. As the Minister of State knows, these schemes will operate on a contractual basis over 20 or 25 years or some other designated period.

I do not understand how boards of management will put up with this in cases where a new sewerage scheme is put in place. The EU directive on the provision of sewerage facilities stipulates that a charge will have to be paid. Thus, the schools will have to pay both a water charge and a sewerage charge. The sewerage charge will be on a water-in water-out basis. Most schools are paying €3,000 to €5,000 annually at present and in some cases they are paying as much as €20,000. In this case they will be faced with a double charge for sewerage services.

As the Minister previously pointed out in the House, best practice for sewerage schemes is represented by the Ringsend scheme, which covers a significant part of Dublin and Kildare. Many schools are being serviced by the Ringsend development alone and they will be faced with capital charges and running costs for sewerage and water services. If they are faced with huge bills for water charges at present, which are likely to be paid on a metered basis soon, they will be faced with double amounts in terms of sewerage charges. Boards of management will be faced with a huge task to raise funds to pay for water and sewerage charges for years to come. They will become glorified fundraisers.

Colleges and schools should not be treated as non-domestic users. The Department should provide an annual grant to the various local authorities to cover those costs. If this does not happen and the local authority needs to waive the charges in the cases of colleges and schools, this shortfall will have to be taken up by the business community, which would place a very unfair burden on it.

I hope the Minister of State can tell me how the Department will proceed on this matter. Government policy is that all water and sewerage services must be paid for except by domestic users. Colleges and schools are in the dilemma of being placed in the non-domestic user category. Either they must pay or somebody else must pay. There should either be a special category for schools or they should be treated in the same way as domestic users.

Minister of State at the Department of the Environment, Heritage and Local Government (Mr. N. Ahern)

I thank the Senator for raising the issue. The Government's water services pricing policy framework, which was adopted in 1998, requires the recovery of average operational and marginal capital costs of water services from the users of those services, with the exception of households using the services for domestic purposes.

The cost of water services provision is increasing hugely. This is not just as a result of general cost increases, but also reflects the considerable operational costs associated with meeting higher quality standards and the very significant investment in water services infrastructure now being made in the context of the national development plan. This investment is essential if we are to maintain and improve our environment and facilitate our rapid economic development. The scale of this is illustrated in the water services investment programme. In the period currently covered by this programme, from 2004 to 2006, more than 800 schemes are at different stages of development with a total investment value of €5 billion. Almost 150 new projects worth €556 million have been added to the rolling programme this year alone.

The recovery of the costs of providing our water services must be viewed in this context. It is vitally important that local authorities have the resources to properly maintain and manage this important infrastructure. It is also very important that major users of water services do so responsibly. We are applying this approach in respect of non-domestic users of water services, while funding domestic use in an increasingly transparent way through the local government fund.

It is a matter for each local authority to set the appropriate level of charges for non-domestic users of water services. At present local authority water services charges and the process used for calculating non-domestic costs vary hugely, as the Senator said. In accordance with Government policy, local authorities are moving to a more uniform system for determining and applying water services charges. In this regard, the policy framework provides only for the recovery of the actual cost of providing water services to the non-domestic sector and that this be done by means of a meter-based volumetric charge.

Universal metering of non-domestic users will ensure that charges directly reflect actual water usage with those placing the greatest demand on our water services paying the most. The policy is being progressively implemented in the period to 2006 and is in accordance with an appropriate application of the polluter pays principle and the requirements of Article 9 of the EU Water Framework Directive. This policy does not provide for the exemption, whether by recoupment or otherwise, of any non-domestic users, including those engaged in the provision of educational services, from the charging policy. Apart from specific considerations of water services policy, this type of exemption would represent a subsidy from local government funds towards a service the resourcing of which is not the responsibility of local authorities. This subsidy would reduce the funds available to local authorities to deal with services, including housing, industry and social services, for which they are directly responsible.

I understand the point the Senator is making. However, I presume the confusion relates to the varying charges in different local authorities. As this becomes more standard, it will just represent one more cost for the boards of management, which get their funding from the Department of Education and Science. If such charges are regarded as standard legitimate costs, it is up to the boards of management of schools to make their pitch to the source of their funding. Schools are being treated as any other type of user. The Government's view is that the only exception should be domestic users.

Mr. P. Burke

While I thank the Minister of State for his reply, there is no great comfort for any schools or their boards of management. I note the Minister of State did not refer to the question I asked about sewerage charges. While the Water Services Bill was introduced in this House a few months ago, I note it has been put on hold until after the local elections. I presume this is a ploy by the Government to delay paving the way for the privatisation or partial privatisation of water services. However, the sewerage charge will double charges and have a crippling effect when it comes into operation, as it must according to Government policy.

Mr. N. Ahern

The Senator is right that there will be charges for sewerage services in future. However, I do not believe they will be at the level the Senator mentioned. Government policy is that people must make a contribution towards the services they use. I am not sure whether the Water Services Bill has completed its passage through this House. It has not reached the Dáil yet. Yesterday I mentioned that I am actively trying to have the Residential Tenancies Bill passed through the Dáil. However, there is a long waiting list to have various Bills taken in the Dáil where legislation seems to be gummed up.

In future people will have to pay. A review of local government funding is ongoing and all these matters must be considered. Given the investment of €5 billion over three years, we must get the message to the people and the best way is that the polluter pays and water is metered. The contributions to be made will be relatively small and will just represent one more bill that businesses and school boards of management will have to meet along with electricity, heating, insurance, etc. They will have to seek recompense for that from the Department of Education and Science. It would be much easier for Government to handle it in that way.

As schools and pupils are supposed to be more environmentally conscious, it is no harm for them to recognise that the polluter pays principle and concern for the environment do not relate only to the rain forests. It is relevant to everyday living. I presume boards of management will submit this as a legitimate cost to the Department of Education and Science while minimising the level of charge to be applied. I am sure they will seek assistance to meet it.

The Seanad adjourned at 4.40 p.m. until10.30 a.m. on Wednesday, 2 June 2004.