Government borrowing could save Irish Water 14m euro a year, committee told
Irish Water could save 14 million euro a year if the Government borrows money on its behalf, politicians have been told.
Advisers in the NewERA agency, which examined funding options for the utility, said the pragmatic approach would be to let the state seek finance for its work on new sewers, pipes and drinking water.
The Oireachtas Committee on the Future Funding of Domestic Water Services was told it is cheaper for the Government to take on debt than for Irish Water to go to the money markets, even over the longer term.
NewERA director Eileen Fitzpatrick said: "In the current circumstances the pragmatic thing for Irish Water to do is to let the state provide the funding.
"That doesn't preclude any time in the future Irish Water going back out to the commercial market. I don't think deciding to fund this from the state is going to make any material difference or lock Irish Water out of lending forever."
NewERA told the committee that Irish Water will be paying interest of 35 million to 36 million euro on borrowings from 2014 to 2016 and about 20 million euro for 2017.
The Right2Water campaign, which opposes domestic water charges, was unable to attend the hearing as union officials involved in the movement were dealing with the announcement of a strike by Tesco workers.
They had notified the committee in advance and sought a postponement of their attendance as hearings explore how Irish Water will raise 5.5 billion euro to upgrade sewerage and drinking water systems over the next five years .
Irish Water would need 239 million euro from the state in 2017 if bills were not reintroduced and another 217 million euro in 2018, the committee was told.
So far 58% of households - 884,000 customers - have had meters installed on the edge of their properties and almost 700,000 properties are yet to be monitored on the grid.
About 200,000 homes were described as "technically difficult" to include in a standard metering programme.