Eurostat Report 'Major Blow' To Government

Reports that Eurostat rejected a plan to keep Irish Water "off balance sheet", has been described as a "major blow" to the government.

Sinn Féin finance spokesperson, Pearse Doherty, made the comments, and added that the government’s argument against his party's plan to abolish Irish Water was now gone. He called on Enda Kenny scrap Irish Water and water charges.

"Sinn Féin’s view has always been that the government’s entire rationale for the Irish Water was flawed. It was simply a vehicle to charge people for their water," Deputy Doherty said.

"But the view that it could be kept off the state’s balance sheet was fundamentally flawed for three key reasons which we pointed out at the time.

"One, the so-called water conservation grant is nothing more than a transfer from government to Irish Water via households which which means this money would be likely to be deemed by Eurostat as expenditure by the government to Irish Water.

"Two, according to Eurostat a company must be fully functional for a number of years before it goes off balance sheet.

"And three, given the level of non-payment the government’s figures simply did not add up. The money put into Irish Water by government must be less than what is returned by its customers.

"The current non-payment level means that the cost of the Water Conservation Grant and its administration costs will exceed the money returned in domestic water charges.

"Sinn Féin is not surprised by the news today as the government had already failed the Eurostat Test when it tried to put €240million into Irish Water off balance sheet in 2013 and it was told that this money must be on balance sheet.

"Today’s ruling has proved Sinn Féin’s analysis correct. The government is now left with egg on its face as it argued time and again that its plan would pass the Eurostat test.

"As a result of this Eurostat ruling all borrowing by Irish Water is now deemed as government borrowing yet Irish Water has borrowings of €850 million which can rise to €2 billion, mostly from commercial sources at rates higher than what the government is paying for its borrowings. This is simply money down the drain.

"The whole argument against Sinn Féin’s call to abolish Irish Water is now gone. Enda Kenny should now accept defeat, he should scrap Irish Water and water charges once and for all.

"If the government continues with its plan to charge for water and to keep Irish Water off balance sheet it will need to scrap the water conservation grant or increase charges. Either way it will be the customer that pays and the public must be made aware of this."

(MH)