Belfast Telegraph

Wednesday 23 April 2014

Gulf on tap tax emerges between oversight bodies

A clear gulf is today evident between the organisations that will guard the public's interests when water charges hit Northern Ireland.

The Consumer Council and regulatory body Ofreg have both been given formal oversight roles regarding the Government-owned company (GoCo) that will run the water service from next April.

But while Ofreg is seeking to reassure householders on its powers, the Consumer Council is still lobbying for a delay in the introduction of the controversial "tap tax".

The council believes that water charges legislation going through Parliament is not sufficiently strong on long-term consumer protection and regulation of the GoCo.

Tensions between Ofreg and the council can also be detected from papers lodged in the recent tap tax High Court battle.</p>

This judicial review was taken by the Consumer Council against the Government over the consultation process for the legislation.

The judge agreed that the Department for Regional Development (DRD) had given the Consumer Council insufficient time to consider proposals when the legislation was being finalised in September.

A "health warning" to this effect has been attached by the High Court to the Water Order currently before Parliament.

The full judicial review ruling has not yet been published but a series of papers from the case has been obtained by this newspaper under freedom of information legislation.

These include an affidavit submitted to the court by Ofreg chief executive Iain Osborne, in which he stated that his organisation was satisfied with DRD's "effective and meaningful" consultation process with it.

He stated that the department had been "open to reasonably expressed arguments" on the contents of the Water Order and had changed its position from mid-September in response to Ofreg concerns.

Mr Osborne's affidavit also expressed anger that an email he had sent to the Consumer Council about the consultation process had been served in evidence.

Dated September 1, Mr Osborne's email stated: "If DRD think I am happy, they are deaf and stupid. Will step up the volume further next week. Perhaps they are not truthful."

The Ofreg chief's affidavit said he was "more than displeased" that this correspondence had been disclosed and was concerned that it would give a "misleading impression" on his organisation's relationship with the department.

He also stated that the email sent on September 1 "expressed my view at that moment but does not represent my considered or current view".

The Consumer Council has maintained that it had a duty to the court to disclose all relevant information, including Mr Osborne's email.

The Ofreg chief executive has stressed to the Belfast Telegraph that his organisation did not take sides in the legal case.

He added: "Our intervention was to set emails from us into context so that they were correctly understood. Notably, that although we felt DRD were not listening at the beginning of September, we did feel that they showed themselves open to reasoned arguments later in the process.</p>

"We did not take a view in my affidavit on any of the legal points on which judicial review had been sought."

Mr Osborne has also stated this week that Ofreg's powers from next April will be greater than those of equivalent regulators in Britain.

He said these covered such areas as price control, asset disposal by the water service and customer protection.

"In Ofreg, consumers have a champion inside the water reform process," he said.

Mr Osborne also stated: "The price control will bite just as hard on a private as on a public company."

The Northern Ireland Office has insisted there are no plans to privatise the Government-owned company that will run the water service from next year.

The Consumer Council has, meanwhile, said Ofreg appeared to have given up its demand for "primary legislative powers".

Council chairman Steve Costello also said: "The Consumer Council believes that water consumers need a strong and independent regulator with the full powers to protect their interests enshrined in primary legislation.

"The Consumer Council does not agree with Ofreg's assertion that they will have the necessary consumer protection powers in law, particularly in the crucial three years leading up to 2010 when customers will be expected to take on the full costs of water and sewerage services."

Mr Costello also stated: "We need to get consumer protection powers right for Northern Ireland rather than continuing to slavishly compare ourselves with England and Wales.

"There is a lot of work to be done if we are to get this right for consumers."

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