The Local Government (Financial Provisions) Act 1997 removed the power of a local authority to make charges for domestic water services. Subsequently, the Water Services (No.2) Act 2013 provided Irish Water with the power to charge for water services. The Water Services Act 2017 discontinued charges for domestic customers of Irish Water with the exception of charges for network connections and excess use of water services.
The Local Government Act 1998 established the Local Government Fund. The Fund historically provided local authorities with finance for funding some of their day-to-day activities, including elements of water services costs, through General Purpose Grant allocations. Central Government funding was also provided for capital investment programmes, through the Water Services Investment Programme (WSIP). The total capital allocation from the WSIP over the period 2000-2013 is estimated at €5 billion or an average of over €357 million per annum.
Since 1 January 2014, Irish Water has statutory responsibility for all aspects of water services planning, delivery and operation at national, regional and local levels. The allowed funding requirement for Irish Water is determined by the Commission for Regulation of Utilities (CRU), as the independent economic regulator of Irish Water. As the funding of domestic water services is disbursed through my Department’s Vote, it is provided on foot of the annual estimates and budgetary processes having regard to the CRU determination.
State funding of Irish Water in respect of operating subvention, capital contributions and replacement revenue in lieu of the suspension and abolition of domestic water charges amounted to some €5.5 billion between 2014 and 2019 or an average of over €900 million per annum. The 2020 Revised Estimates provision for Irish Water is almost €1.2 billion in respect of domestic water services.
The new Programme for Government commits to fund Irish Water’s capital investment plan for drinking water and wastewater infrastructure on a multi-annual basis and deliver the €8.5 billion funding package committed to in Project Ireland 2040.
