Get the Facts – Water Charges

‘Our Water is not for Sale’

GET THE FACTS – WATER CHARGES

WaterTax

From October 2014, you will have to pay for your water. The bills will arrive a few months later in January and they will amount to about €300 a year. You are already paying for a water service through central taxes. But the government wants to reduce public spending on water in order to make you pay directly. This is, therefore, a double tax – for something you have already paid for. The water bills will come on top of property charges and many other tax hikes. If we do not stop them BEFORE they are introduced, they will rise each year. One economist, for example, has calculated that they will rise to €630 a year. The average water charge in Britain is also over €500 a year. The whole idea of charging for water is unjust. Water is not an optional extra – or a consumer choice. Like the air we breathe, water is one of the essentials for human life. We can live sixty to seventy days without food, but without water we will die within three to seven days depending on the climate. It should not be turned into a commodity from which large corporations will profit.

CONSERVATION THE EXCUSE – PROFIT THE REAL MOTIVE

The big push for water charges came from the Troika of the IMF, EU Commission and the European Central Bank. Their Memorandum of Understanding with the Irish government stated that there had to be ‘full cost recovery in the provision of water’. The Troika has left but the government still wants to push ahead with water charges. To cover their tracks they suggest that the main reason is that water charges help to conserve water. The facts, however, tell a different story.

  • The greatest cause of water waste is leakage from antiquated pipes. Currently 41 percent of Irish water is wasted because the government failed to adequately invest in pipes. That is double the OECD average.
  •  The government says that water metering will cost at least €500 million. But Engineers Ireland, state that the ‘International experience suggests that the cost is more likely to approach €1bn’. If that €1 billion was invested in repairing leaking pipes and other sensible conservation measures were taken, there would be no need for water charges.
  • Metering does not save water – it only monitors it. Countries that have the highest levels of metering have also the highest levels of water usage. In Canada, 61 percent of houses are metered. In the US nearly all houses are metered. But these countries consume 300 litres and 425 litres a day respectively. In Ireland, we only consume 150 litres a day.
  • Meters mean more connections – and this can even mean more leaks, particularly during cold snaps.
  • Water metering has led to no significant reduction in water usage in Germany or Holland.
  • The Walker Report in Britain – where less than a third of houses are metered- suggested that charges might lead to a reduction of 15 litres per day per person in consumption over the longer term. However Ireland already has charges for the non-domestic sector, which accounts for about half of water usage. Even if this report was an accurate prediction, it would, therefore, only lead to an 8 litre person reduction.   But metering is a very costly process for a relatively small reduction. In addition, the new system requires high ongoing costs for billing. This money could be used on a public education programme and repair of leaking pipes.

HOW TO CONSERVE WATER WITH NO CHARGES

If the government really wanted to conserve water rather than charge people, it could take some additional measures beyond investing in the water piping system. Ireland is a wet country with approximately 42,000 litres of rain falling per person. The problem is not water but rather ensuring that drinking water – which requires proper treatment, is separated from grey water – which can be used in toilets, dishwashers or washing machines.  Grey water recycling and rainwater harvesting could cover much of our domestic requirements because only 6% of our water requirements are for drinking or cooking. Here is how it can be done:

  • Establish proper building regulations – run by public bodies – to ensure that all dwellings are fitted with dual flush toilets. Engage in a long term programme of retro-fitting existing buildings. Dual flush can save 20 litres a day.
  • Establish dual water systems in houses where only one source provides drinking water.
  • Promote rainwater harvesting. Up to 300 litres of rainwater can be stored and used for non-drinking purpose if household tanks are promoted.

THE REAL AGENDA BEHIND WATER CHARGES

Ireland is in huge debt because of massive private bank debts and a failed policy of austerity that has destroyed the economy and society. Debt now exceeds 150 percent of Gross National Product and as a result, we are forced to pay out €9 billion a year in interest payments. The government’s aim is to make low and middle income people shoulder the burden of this debt – so that their wealthy friends get off easily. Tax on PAYE workers, for example, has shot up from 27 percent of all revenue in 2007 to 42 percent today, while tax on profits and capital gains has fallen as a proportion of total tax. But as well as hiking taxes, the government wants to slash public spending – so that it can pay off more to the bondholders. This is the main reason why it is talking about ‘full cost recovery’ for water and reducing state investment in the service. Despite the need for a huge investment in water infrastructure, the state has cut its capital investment from €500 million in 2010 to €296 in 2014.  It wants to withdraw from nearly all funding by 2018. Water charges, therefore, are simply another way of making us pay for the economic crimes of the bankers and the wealthy.

GREED TRUMPS NEED: THE BLACK ART OF PRIVATISATION

Water privatisation was attempted in many countries in the 1990s but it has fallen into disrepute. The result is that more sophisticated methods of ‘hollowing out’ the public sector have emerged. Irish Water, as a Public Utility model is one of them. Here is how it works:

  • All the assets of Ireland’s local authorities have been transferred to Irish Water, which at present functions as a division of Bord Gais.
  • These assets are used as collateral and the company goes to the global ‘capital markets’. ‘Capital markets’ are code words for large corporations and rich people who provide money for a cut of the profits.
  • These wealthy investors get a share of the commercial profits of Irish water – but they can also dissipate public hatred against privatisation by sheltering under a public utility model.
  • As profits and returns on investment become the key driver, Irish Water, acknowledges that water charges will increase if people start using less water.
  • Water and wastewater treatment is already heavily privatised through the use of Public Private Partnerships. These schemes mean that private companies get to run services risk free for 20 years – and there is no public access to the exact commercial deals they got from the state. Currently, there are 66 PPPs in operation in the Irish water service.
  • Irish Water’s declared purpose is to increase this private sector involvement. It will do this through ‘Service Level Agreements’ and direct outsourcing. Bill payment to Irish Water has already been outsourced to a low wage, non-union firm, Abtran.

DENIS O’BRIEN WINS AGAIN

How strange! Siemens offered to meter the whole country for Irish Water at a cost that would be re-cooped in the long term. But Phil Hogan, the former fund raiser for the Fine Gael party, said no. Instead one of the major contracts to fit meters went to a company owned by Denis O’Brien. This is the same man whom a High Court Judge said ‘beyond all doubt’ had been given ‘substantive information’ by another former Fine Gael fundraiser, Michael Lowry, that was ‘of significant value and assistance to him in securing the (Esat) license’

Just before it was announced that Bord Gais would be running Irish meters, Denis O’Brien bought Siteserve for €45 million. (The former Anglo-Irish Bank had written off €100 million of the debt the company owed it) Then, lo and behold, Siteserve was wound up and resurrected as Sierra and won a contract to install meters. What a lucky man!

ON THE GRAVY TRAIN

The government’s strategy in setting up Irish Water has created a massive gravy train. Even before the bills arrive, the company has become a super-quango. Our taxes –mainly the property tax – have been used to subsidise consultants, profiteers and over paid executives. Here are some of the winners.

John Tierney: This former Dublin City manager spent €90 million of public money in building a waste incinerator at Poolbeg, which may never see the light of day. €30 million of that money went to RPS for carrying out propaganda and gaining support through ‘stakeholder consultation’. Despite this waste, Tierney landed a €200,000 a year job at Irish water.

Jerry Grant; The former boss of RPS, who had worked closely with Tierney, has become one of the top managers of Irish Water.

Twenty Nine Executives: All earn over €100,000 in Irish Water .

One Yoga instructor: Unnamed but got €200 for conducting an hour long laughing and wellness class for Irish Water executives. Maybe they were laughing at the eejits who were paying them.

A CONSULTANTS BONANZA

The proposal to set up Irish Water arose after the government commissioned a leading consultancy/accountancy firm, PWC, for a supposedly ‘impartial’ report. Ever since, Irish Water has provided a bonanza for consultants. The big winner was IBM. This gigantic US anti-union firm got €44 million in contracts. The next winner was Accenture, who got €17 million for such items as ‘guiding principles;’ and ‘programme management, which apparently includes liaising with the government. But the best pleased of all was Ernst and Young. This was the very same company who signed off on Anglo-Irish’ dodgy accounts – yet they got €4.6 million from Irish Water.

HOW WE CAN BEAT THEM

The government are very worried about the people’s reaction to water charges. So they sought – and got – special permission from the Troika to delay them until after the local elections in May 2014. Their strategy is to promote a sense of fatalism so that people think there is no point in resisting. This is why they moved on property charges first and deployed massive intimidation by using the Revenue Commissioners to terrify people into paying. Instead of giving into this fatalism, we need a clear strategy to defeat these charges. Here is how we can do it:

  • Make the local and Euro elections on May 23rd pay-back day. If Labour is destroyed, it will de-stabilise this rotten government. Every vote for People Before Alliance is a vote for active resistance to these charges. People Before Profit is an anti-water charges party that will use all elected positions won to encourage resistance to these charges.
  • Prepare for mass protests. Mass protest and civil disobedience stopped an Irish government building a nuclear power station at Carnsore Point. More recently, mass protests stopped the sell-off of Coillte. The people of Bolivia have shown how protest and escalating civil disobedience could topple a government that tried to privatise their water supply. We can do the same here.
  • Oppose the charges. The lesson of the property tax is that a boycott campaign can only be successful if it grows out of a campaign of massive public protest and determined opposition. This will include local resistance on the ground in opposition to metering where it is possible to mobilise enough people.

 

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