NI Water has published its annual report for the year ending 31 March 2020. As a statement of accounts it is reassuring.
Business levels are increasing and pre-tax profits are high.
The financial results are deceptive. The profitable outcome is heavily influenced by an Executive policy decision that payments by householders are avoided and that part of revenue accruing to NI Water is in the form of a subsidy taken out of Stormont finances and, indirectly, out of the NI Block grant.
Compared to other UK regions, money that might have contributed to public services is used to avoid domestic water charges.
An indirect consequence of the formula used to give NI Water profitable trading is that the water infrastructure is being allowed to deteriorate.
Customers, domestic or business, cannot readily expect to make new connections to the water and sewerage infrastructure in over 116 different parts of Northern Ireland. And the problems are particularly intense in the Belfast region.
NI Water chairman Len O'Hagan is unambiguous.
"Northern Ireland is unique as the only region in the UK with a broken funding model.
"Underfunding is part of a generational underinvestment in the sewerage infrastructure which.. risks deterioration in levels of service leading to inadequate environmental protection through increased sewer flooding and pollution...
"We will have to make difficult choices about our economy and our natural environment."
There was a significant level of investment in water services costing £186m in 2019-20.
Sadly, it is well below what an independent water authority would invest and pay for its capital costs on a trading basis.
NI Water implements a capital investment programme which is well below what, on its business assessment, would be merited.
Mr O'Hagan argues that over £2bn is required in the next six years, 2021-27.
This ambitious but well-judged request will go first to the Utility Regulator who must consider the merits of the case.
In recent years the Regulator has been quite restrained in final investment plan decisions.
The inadequacy of the approved investment plan is made even more forbidding when the Department for Infrastructure fails to honour the full regulatory approval because the Stormont Executive cannot find funds to cover the regulatory commendation.
The Executive will argue that all public sector capital programmes are living with a smaller allocation than might be claimed.
Whether fairly or unfairly, the fate of the water services has become (allegedly) a product of insufficient finance from Westminster.
The scale of the shortfall in capital investment can be seen in the outcome of the business plan for the period 2015-21.
It started with a credible case for £1.7bn.Funding for only £990m was approved.
Even this reduced figure was not honoured.
The result has been that many new housing developments have been unable to connect to the sewerage system in parts of local cities and in over 100 towns.
Whilst there are many constraints on ensuring an adequate rate of building new homes, the lack of ability to connect possible new areas is now a critical factor.
NI Water is currently making a case for regulatory approval on a larger scale. On past precedents, this will not tackle the critical institutional failure of the way in which NI Water has been established.
There are alternative institutional arrangements that might make the business model function more acceptably.
NI Water itself has hinted at the direction that might be taken to build a more diverse infrastructure.
It refers to investment described as 'blue green'. This would utilise nature's ecosystem services to filter our raw water, slow flood water and store carbon, acknowledging that this points to the use of different technologies.
To devise an appropriate strategy, NI Water commends the need for a National Infrastructure Strategy to take a long term perspective on funding and policy for the year up to 2050.
Present policies are clearly proving inadequate: so is the Executive ready to face this challenge?