By Paul Melia
Tuesday March 20 2012
UP TO 90pc of the country’s 1.35 million households will start paying water charges from 2014, according to a major new report prepared for the Government.
Consumers will also be forced to pay VAT on top of their bills, adding at least 13.5pc to the charge. This is because a private company, Irish Water, will be charging for the services instead of a public body.
The water charges will be in addition to the new property tax — but it is not yet known what rates will be imposed.
The Irish Independent revealed yesterday that property taxes will be pushed through next year, earlier than previously thought.
The charge will be up to €300 for a regular semi-detached household, three times the current household charge.
The report from consultants PriceWaterhouseCoopers (PwC) also warned that households which currently experience problems with their water supply should not expect a better service even though they will be paying.
Last year, the HSE was informed of 541 occasions where water quality posed a risk to public health, up 11pc from 2010 when 487 cases were reported.
However, the report said that it “may not be possible” to improve water quality over the coming years because there was a huge amount of work needed just to bring services up to a basic standard.
The PwC report also said water charges should be kept “as low as possible”.
The Government plans to introduce water charges to domestic customers from 2014 which will bring Ireland into line with most EU countries.
Businesses currently pay for water on the basis of how much they use — but just 52pc pay their bills, resulting in local authorities being owed €124m.
A public consultation into the proposed new system is currently under way, but the PwC report sets out the challenges the Government faces.
The Consumers’ Association of Ireland said customers should not have to pay if a high-quality service was not being provided.
“It’s going to take quite a while to gear up to a system that’s fit for purpose, which you’re entitled to if you’re paying,” spokesman Dermott Jewell said.
The PwC report also reveals:
? 1.35 million homes will be hit with bills, of which 300,000 will pay a flat-rate charge. This is because they live in terraced homes or apartments which are too expensive to meter.
? Meters may have to be replaced “on a regular basis”. It is not clear if the household or Government will pay the estimated €500 cost of each meter.
? It will cost at least €10bn to bring Ireland’s water quality up to EU standards by 2027.
? Despite more than €5bn being spent in the past decade, there is a backlog of ‘priority’ works needed which will cost at least €500m.
? Improving standards to meet EU targets on drinking water quality “may require” several hundred million euro of extra expenditure every year.
? Commercial users may also have to pay higher bills. This is because, by law, they must be charged the full cost of providing the water. Consultants say there is a ‘wide variation’ in charges, suggesting that discounts are currently given.
? Up to 4,000 local authority staff are likely to be transferred to the new agency, Irish Water.
Legislation is expected to be published later this year which will allow Irish Water to take control of providing water to homes and businesses.
– Paul Melia