In a reply to a parliamentary question asked by Fianna Fáil Environment Spokesperson Barry Cowen the Minister for the Environment Alan Kelly has confirmed that €60m will be taken from the local government fund to pay Irish Water’s commercial rates.
It follows efforts by the Government to cook the books of Irish Water in order to ensure it will pass the EURO Stat Market Corporation Test in April 2015.
Deputy Cowen said, “The government is making up its water policy as it goes along. Since charges were originally introduced on October 1st there have been over 10 U-turns. Now it is raiding the local government fund to pay local authorities money it is owed from Irish Water. This is a cynical accounting exercise that will leave local authorities already struggling with cut backs worse off as a result of the super quango the government set up.
“The Local Government Fund was set up to finance local authorities. It’s funded through the local property tax and the motor tax fund. Taking money already designated for local government and then re-packaging it as the Irish Water commercial rates bill is another sign of the desperate lengths the government is going to as its water policy flounders.
“Local Authorises were planning for a revenue stream from Irish water that would help them deal with the cuts they have endured over the past few years. Now the rates bill will be simply removed from another source of funding for them. The Local Government Fund has spent €485m subsidising Irish Water this year and is expected to direct another €400m in 2015.The exorbitant costs involved in Irish Water continue to grow bigger and bigger. All the while €540m spent on water meters will rot in the ground unused for years. Now the government is further undermining local government funding by cooking the books and raiding the fund set up to keep it financed. It’s time to bring the sorry mess of Irish water to an end” Deputy Cowen concluded.
Please find below the relevant Parliamentary Question referenced above.
To the Minister for the Environment, Community and Local Government:
To ask the Minister for the Environment, Community and Local Government if his Department has received a further Exchequer payment to meet the €60 million commercial rates bill for Irish Water; and if not if the Local Government Fund will be used to fund the payment. – Barry Cowen.
Minister for the Environment, Community and Local Government (Deputy Alan Kelly):
The Government announced a new package of measures last week relating to water charges and financing of Irish Water. As part of the package of measures I announced a changed approach to the treatment of water infrastructure for commercial rates purposes such that Government subvention does not need to be paid to Irish Water to fund this cost, and can instead be redirected to provide equivalent support directly to local authorities through the Local Government Fund. Provision will be made through the Local Government Fund to allow for the compensation of local authorities in respect of rates income forgone.