Water charge review recommendations to go to Executive

The first of two reports on the review of water and sewerage services is out, and the Regional Development minister is low-key in his response, and is taking the recommendations to the Northern Ireland Executive – [for some collective responsibility? – Ed]. The BBC report indicates a couple of important points. Firstly, according to the report, the review estimated that we already pay £160 for water and sewerage services. Secondly when the new charges come in, in 2009, as well as the £160 we’ll pay on average an extra £120 – although this report quotes an average of £145. It also appears that the extra charge, rather than both charges will be identified as a water charge in the rates bill and will be based on property values. I’ll try to confirm that if I can find the report. [See below the fold] No word on those existing contracts.. Adds Report available here – direct link to pdf file here And The We Won’t Pay Campaign’s reaction hereUpdate Now that I’ve had a chance to read the report there is word on those contracts.

Northern Ireland Water’s contract with Crystal Alliance should be fundamentally reviewed.

And it now looks like the total charge will be identified as a water and sewerage charge.

Householders’ payments for water and sewerage services should be clearly and separately identified on their rates bill and earmarked for Northern Ireland Water (2.36)

Now here’s an interesting recommendation that the Finance minister will have to look at

Despite the potential costs to the NI Block, there should be at least a partial waiver of the dividend extracted from NIW by DRD, such that customers will pay no more than they would under a debt financed model (6.9)

More of those recommendations

NIW’s contract with Crystal Alliance should be fundamentally reviewed, given that our recommendations will considerably alter the nature and scale of the work required (7.5)

From 2008/9 liability for the costs of road drainage should be transferred from sewerage users to the Roads Service (7.8)

The Reasonable Cost Allowance Scheme for developers should be reviewed to ensure that it is cost reflective and is operated at no cost to other users (7.11)

NIW assets which have already been identified as surplus should be disposed of to maximise their value to customers and taxpayers (7.17)

The Regulator should review NIW’s portfolio of assets with a view to identifying additional assets which are surplus to requirements and disposing of them (7.17)

Update In the comments zone John O’Farrell points to the ICTU response

And here’s another interesting paragraph from the Review’s report

4.21 In the context of demands for a “green dowry”, we have discovered that at the time of privatisation in England and Wales, Northern Ireland received an adjustment through the Barnett formula in respect of the restructuring costs associated with the privatisation process. We understand that this added £50m annually to the NI Block, and that it is continuing to be paid. This and other factors will need to be taken into account in weighing up the case for seeking an additional contribution from the Treasury in respect of past underinvestment. This money could contribute to the affordability payments which we will consider in the next report.

More detail on those budgetary considerations

Impact on the NI Block

8.9 Our recommendation on reducing the rates will cost the NI Block £109m annually relative to NIO ministers’ proposals.

8.10 Our recommendation on the dividend would cost the Block around £7m. It might also result in a once off charge of around £12m.

8.11 Our recommendation on road drainage would cost the Block an estimated £25m, on the assumption that road drainage accounts for around 15% of allowed sewerage revenue.

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  • Pete,
    here’s the ICTU response.

    http://www.ictuni.org/?tabindex=63&tabid=122&parentid=121

    ICTU CALLS ON NI EXECUTIVE TO ADOPT NEW FUNDING PROPOSALS FOR WATER

    The Irish Congress of Trade Unions today welcomed the report of the Independent Water Review Panel on the cost and funding of the water and sewerage service in Northern Ireland.

    Speaking after the launch of the Panel’s review, Peter Bunting, Assistant General Secretary of the Irish Congress of Trade Unions, said:

    “This report shows that wisdom, efficiency and humanity are not mutually incompatible when it comes to providing a public service. We welcome the acknowledgement that consumers and families were already paying for water through their rates, and that system remains the fairest and most efficient way of funding the vital work of the water service.

    “We also welcome the affordability safeguards, and the recognition that domestic metering was neither fair nor efficient. Further, the report details the staggering amount of money wasted by the so-called ‘reform’ process. This scam wasted over £12 million of public money, of which £7.2 million went into the pockets of external consultants.

    “Better still, we applaud the call for the pointless contract with Crystal Alliance to collect separate water charges to be “fundamentally reviewed.” The privateers and their facilitators under direct rule have been comprehensively routed. Direct rule ministers have been found to have used “stealthy tactics” and “clear misrepresentation.”

    “The trade union movement has been vindicated. We were accused of being irresponsible for calling for non-payment of water charges. If we had not, people would have been paying twice for water since last April, and NI Water would be well on the way to privatisation. This is a terrific vote of confidence for the public sector.

    “We take this opportunity to congratulate our allies in the campaign against water charges – most of whom were ordinary citizens, community activists and trade unionists who believed that the planned separate water charges could be overturned despite having very little political support.

    “The Panel will now move on to Strand Two of its work, a review of the management, governance and delivery of water and sewerage under public ownership. They can be rest assured that that the trade union movement will continue to monitor their deliberations, and hope that they ensure that efficiencies identified in NI Water do not concentrate on cutting jobs.”

  • Pete Baker

    Thanks John.

  • Garibaldy

    Good statement from the ICTU. And an effective campaign.

  • URQUHART

    “Good statement from the ICTU. And an effective campaign.”

    Mmm. Let’s come back to that when we see what the 40% efficiencies that the report asks for from NIW look like.

  • fair_deal

    Did McGimpsey reject this report last night on Lets Talk?

  • Frank Sinistra

    So it’s a notional charge for 18 months and then hitting everyone for additional money based on home value? And this is a success for some of the ‘No’ campaign?

    Split it, then up it?

    Am I stupid or something?

    This is surely just delaying a new tax for a natural resource? And the Unions and Shinners, self proclaimed Lefties, think they can sell this along with their right-wing partners as anything other than an absolute defeat?

  • Comrade Stalin

    I’m confused. The water information I got through the door suggested that the water charges would, in a few years, end up at around £600. Now they’re saying they only want £160. So what was all the other dough for ?

  • I wonder…

    The £160 represents the current chunk of rates which is being re-allocated to water/sewerage. Its only the start. You (and I!) may yet end up paying the £600 if the full capital value rate is applied…

  • Pete Baker

    Comrade

    Not quite.

    They’re saying they have been getting £160 on average.

    And they’re going to take that again next year.

    And in 2009 they’ll take an additional £145 on average.

    So the NIW tab in 2009 should read £305 on average.

    The recommendation of the review is that the rates section of the bill drops by £160 on average to compensate.. and to avoid billing for services paid for by the NIW tab.

    And if you believe that will happen, and remain so over time, I have a wonderful once-in-a-lifetime opportunity for you to buy London Bridge..

  • pauljames

    Since when did rateable value have anything to do with water usage? This compounds the same lazy logic that established that value in the first place. If you want to tax the rich at least have the balls to be up front and have a tax based on income. The fact that working people who have invested in their own houses pay for everyone else
    establishes the principle of “I dont give a toss lets unscrew the hydrant and save me having to entertain my kids”, and dont get me started about smug gardeners diverting the equivalent of the Lagan to keep their aspidistras flying, I’m off now to lift that half brick out of my sistern and have a decent flush for a change.
    (sorry rant over, I’m just getting it really tight with my rates bill as it stands!)

  • barnshee

    Watch Conor Wriggle
    The new intellectual style spectacles don`t really cut it

  • Comrade Stalin

    My parents did tell me a while ago about how their parents sent them down to the water board in Belfast (in the building presently occupied by Marks and Spencers) with the money to pay the water bill. Some point subsequently – either in the 1960s or 1970s – the Government announced that the water bill was to be incorporated in the rates.

    Since the government intended to add a water bill and made no mention of discounting the water section of the rates, I had assumed that the government intended to charge twice for water and get away with it. Sounds like this has been less easy than they guessed.

  • Sir Herbert Mercer

    “The new intellectual style spectacles don`t really cut it”

    Now that really is interesting: the Minister for Regional Development gets glasses to look good whilst the Minister for Finance gets laser surgery to do the same.

    More to keep the chuckle brothers laughing

  • I wonder…

    The £305 *average* will include as it always included, the ooo’s of HE properties for which the HE will pick up the tab (they tend to be at the lower end of the valuation scale) If you’re an average owner occupier – NOT in a HE property – the *average* is significantly higher.

    Its a con – but a devolved govt. con.

    Does that make it any better?

  • ulsterfan

    Whats all this fuss about?
    There will be no water charges because the Shinners have said so .
    They are also supported by DUP and SDlP.
    Surely politicians will not go back on their word as they are all honourable gentlemen.
    No need to worry.

  • I wonder…

    ….is worth recording this panel was not a DRD panel, but an excutive review panel.

  • CIARAN10

    What most people don,t understand about water charges …conservation ..you only pay for what you use..we all believe water is free it,s not we don,t mind spending $! for a bottle of water but god forbid that we have to pay the same for 100 cubic feet through the tap ..Then there is the sewge problems ..folks it won,t just dissapear look at the problems with the water on the west coast the ground water and aquifilters are over taxed ..WE can live without a lot of things water is a basic like the air or sunlight we should treat it as a commodity and tax the hell out of it before its to late