The Water Services (No. 2) Act 2013 provides that Irish Water can collect charges from its customers in receipt of water services provided by it. The Act also provides that responsibility for the independent economic regulation of the water sector is assigned to the Commission for Energy Regulation (CER) and the CER has been given statutory responsibility for protecting the interests of customers. The approach to charging will be outlined by Irish Water in a water charges plan to be submitted by it to the CER in line with the provisions of the Act. The CER will be responsible for approving, with or without modifications, the water charges plan which will set out the approaches to charging domestic and non-domestic customers.
An inter-departmental working group has been established to advise the Government on the appropriate method for addressing affordability issues which may arise with the introduction of domestic water charges. The group comprises officials from my Department and from the Departments of the Taoiseach, Social Protection, Public Expenditure and Reform and Finance. A report will be submitted for consideration by Government based on the group's examination of the issues involved and the Government will decide on the proposed approaches to be taken in relation to affordability and the free allowance.
The Government has committed to the provision of a free allowance, above which charging based on usage would apply. The free allowance and the level of funding to be provided by the Government to Irish Water will have a strong bearing on the net charges to be met by households. Consequently, decisions on these matters will provide greater visibility on the expected level of charges in advance of the final determination of all aspects of the water charges plan by the CER. I expect to bring proposals to Government in this regard shortly.
The CER will announce its decision on the approved water charges plan in August 2014. In making its decision on the approval or otherwise of the first water charges plan, the CER will take into account the decisions made by Government on the funding model for Irish Water, including the funding available for a free allowance and any proposed affordability measures.