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Second Stage

Executive Committee Business – in the Northern Ireland Assembly at 11:45 am on 29th September 2009.

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Photo of Conor Murphy Conor Murphy Sinn Féin 11:45 am, 29th September 2009

I beg to move

That the Second Stage of the Water and Sewerage Services (Amendment) Bill [NIA 3/09] be agreed.

The Bill amends the Water and Sewerage Services (Northern Ireland) Order 2006 to extend by three years the period during which my Department is prepared to subsidise NI Water (NIW) in lieu of customer payments. If the change were not made, the existing provision for the payment of a subsidy would expire on 31 March 2010.

In wider terms, the effect of the Bill is to provide for the continuance of a sound legal basis on which the Executive can pay domestic customers’ bills on their behalf. It gives financial stability to NIW and ensures that the funding to allow the delivery of services is provided.

I appreciate that much wider questions exist about how the Assembly should deal with the future funding of water, but the Bill does not address those: that is a matter on which the Executive must decide. The three-year extension of the subsidy simply provides for the continuance of current funding arrangements.

I have set out the principle that underlies the legislation and what will be achieved by its introduction, the necessity for which is self-evident. I commend the Bill to the Assembly.

Photo of Fred Cobain Fred Cobain UUP

As Chairperson, I welcome the opportunity to contribute to the debate on the Second Stage of this important Bill. The issue today is whether the Assembly is content to endorse the principles of the Water and Sewerage Services (Amendment) Bill 2009. In the absence of funding through payment by customers, the Bill aims to ensure the continued provision of a subsidy to Northern Ireland Water.

Under article 213(3) of the Water and Sewerage Services (Northern Ireland) Order 2006, the Department for Regional Development (DRD) is required to make grants to Northern Ireland Water equal to the amount of discounts provided to customers in the initial period. The 2006 Order defines the initial period as three years from the coming into operation of the Order. During that three-year period, the direct rule Administration had intended to phase in charges for water and sewerage services. That initial period expires on 31 March 2010, and the Department has stated its willingness to make grants to Northern Ireland Water after that date.

As the Minister said, the Executive have yet to make a decision on the future funding of water and sewerage services. Even if a decision were to be taken next week, the indications are that Northern Ireland Water would not be in a position to issue bills and collect revenue by April 2010 as there would not be sufficient time.

The Committee for Regional Development is mindful of the need to progress business in an efficient and effective manner while discharging its responsibility for scrutiny to the entire Assembly thoroughly and conscientiously. The Committee will take that approach with the Bill.

The Committee does not intend to oppose the principles of the Bill. It is important that Northern Ireland Water operates within a stable financial environment to ensure that the much-needed sewerage infrastructure investment programmes make progress and that the planned efficiencies and service improvements are delivered.

However, significant financial implications for Northern Ireland arise from the deferral of charging for water and sewerage services. This Bill creates the mechanism to put into action a decision by the Executive to continue to defer water and sewerage charges. Recently, there have been some discussions in the media about the impact on the Northern Ireland block grant of deferring water and sewerage charges. The Committee explored some of those issues with DRD officials during pre-introduction briefings and over the course of the previous session as the issues emerged.

At Committee Stage, we will seek clarity of the costs of continued deferral, including the costs that are associated with the reclassification of Northern Ireland Water for public expenditure purposes, the basis for valuing Northern Ireland Water assets and the ongoing ability of Northern Ireland Water to reclaim its input VAT. The Committee will also seek clarity of the financial impact that ongoing deferrals may have on the Northern Ireland block grant as a whole, the DRD budget and the budgets of other Departments. The Committee looks forward to receiving this Bill at Committee Stage. I assure the House and the Minister that this Bill will be treated by the Committee as a matter of priority.

Photo of Michelle McIlveen Michelle McIlveen DUP 12:00 pm, 29th September 2009

As the Chairman of the Committee for Regional Development indicated, the Committee discussed the principles of the Water and Sewerage Services (Amendment) Bill and has agreed to support them.

It is a very short Bill that appears to be mainly technical in nature, the purpose of it being to continue the customer subsidy to Northern Ireland Water (NIW). As was indicated, the power that was given to the Department under the Water and Sewerage Service (Northern Ireland) Order 2006 to pay the grant equal to the amount of discounts to customers comes to an end on 31 March. Obviously, the direct rule Administration had anticipated that the phasing in of charges for water and sewerage services would have been complete at that stage. Members are clearly aware that that is not the case and that water charges have been deferred, hence the requirement for this legislation.

It is my understanding that if the payment does not continue from 1 April 2010, Northern Ireland Water will be unable to pay for the delivery of what we very much take for granted; that is, water and sewerage services. Due to a legacy of many years of under­investment in our infrastructure, Northern Ireland has lagged behind the rest of the United Kingdom. Only in recent years have we started to see the benefits of investment. I know that in my constituency, a substantial number of infrastructure programmes are being carried out and are planned for. Future investment in water is critical from an environmental and a health perspective.

The issue of water and how it is paid for is hugely emotive. The Chairman highlighted the issues around the continued deferral of water charges. However, it would probably be mischievous and unwise for us to deviate from the principles of the Bill that is before us today. At this stage, I am content to accept the principles of the Bill. I look forward to the Committee Stage.

Photo of Raymond McCartney Raymond McCartney Sinn Féin

Go raibh maith agat, a LeasCheann Comhairle. Ar dtús, ba mhaith liom a rá go mbeidh Sinn Féin ag tacú leis an Bhille, agus táimid ar son leanúint ar aghaidh leis an obair seo.

Sinn Féin will support the taking forward of this Bill. The Water and Sewerage Services (Amendment) Bill is designed to ensure the continued provision of a subsidy to NIW by the Department. Therefore, as has been stated, it is very much a technical Bill.

The current situation is that the Department’s ability and legal competence to pay a subsidy to NIW expires on 31 March 2010. That was a condition that was laid out in the Water and Sewerage Services Order 2006, which, in essence, established the company on 1 April 2007. If that Order expires, there will be no provision for the Department to provide grants or subsidies to NIW. Therefore, the company’s ability to exist and its ability to continue with the provision and management of our water and sewerage system will come to an end. This Bill will provide the basis to move forward and allow NIW to continue with its investment programmes and related works.

I welcome the decision, as outlined by the Chairperson, that the Committee for Regional Development supports the principles of the Bill. We look forward to working with it. Irrespective of decisions that were made in the past by previous Administrations — all of us have our own views of those decisions — as the Chairperson pointed out, it is incumbent on all of us to ensure that NIW operates within a financially stable environment and to allow the continuation of its work. The Bill allows that to happen.

We also support the Bill because it creates a mechanism by which the Executive can continue to defer water and sewerage charges. I agree with the Chairperson that it will be important to seek clarification at Committee Stage of the direct and indirect costs of deferral. Those issues have been discussed on many occasions at the Committee and will, undoubtedly, be revisited at Committee Stage.

I welcome the commitment of the Chairperson, the Deputy Chairperson and the Committee to prioritise the Bill. I assure the Minister of the full co-operation of Members on this side of the House as he takes the Bill forward. Go raibh maith agat.

Photo of Tommy Gallagher Tommy Gallagher Social Democratic and Labour Party

I apologise to the House, and to the Minister in particular, for being a few minutes late for the debate; I was delayed at a meeting of the all-party Assembly group on learning disability.

The SDLP has serious concerns about the Bill. For one thing, the full financial implications have yet to be debated fully and openly. We are being asked to support a Bill that, we are led to believe, will give the Executive the option to continue to fund Northern Ireland Water through the payment of a customer subsidy. However, neither the Department for Regional Development nor the Department of Finance and Personnel (DFP) will state convincingly that they will use that option if the Bill is approved by the Assembly.

Members should remind themselves that, at present, the public are worried, mainly about their jobs, mortgages and impossible increases on rates bills. The shadow of potential water charges now hangs over that. Only last week, the Minister for Regional Development said that he was unable to rule out the introduction of water charges during this Assembly’s lifetime. Around the same time, the Minister of Finance and Personnel said that he may be forced to introduce water charges because of pressures on the block grant. Indeed, his Department’s costings for previous years included allowances for payments through water charges.

Those comments and documents from the heart of Government, some of them leaked, tell us that, despite the absence of debate, the public are completely bewildered about water charges, particularly in relation to the positions of Sinn Féin and the DUP. Prior to elections, those parties told the public that they would stop the introduction of water charges. That is not what happened.

Photo of Simon Hamilton Simon Hamilton DUP

My party’s position is perfectly clear; the position of the Member’s party, on the other hand, is a little more confused. If he is so opposed to the introduction of water charges at any stage and under any circumstances, will he explain why his colleague the Minister for Social Development, Margaret Ritchie, voted in the Executive for a Budget predicated on the introduction of water charges by now?

Photo of Tommy Gallagher Tommy Gallagher Social Democratic and Labour Party

We all understand very well that we have a strange democracy here, in which, under a ministerial code, Ministers are required to support Executive decisions. [Interruption.]

I am outlining the party’s position, and I referred to the position of Mr Hamilton’s party because it is so well known.

Despite all the promises to which I referred, what happened in 2008? Water charges for businesses were introduced at a 50% rate, and, in April 2009, they were increased to full charges. How do we explain that to the public? The best way is to have a full and open debate in the Assembly, and that has not happened. We have never been afforded that opportunity.

Yet serious problems in relation to Northern Ireland Water emerge almost every week. Recently, the Utility Regulator published ‘Water and Sewerage Service Price Control 2010-2013: Draft Determination Summary Report’. It rightly raised the infrastructural problems which we have inherited and which have to be tackled. It also showed that Northern Ireland Water had bid for £136 million more than the Utility Regulator deemed necessary. In July, Northern Ireland Water admitted that it had been overcharging some business customers. There is a great deal that is not right within the system, and in the way that we are taking forward the Bill, we are not facing up to that. Let us see what happens when the Bill gets to Committee Stage. We all know that there has been no public consultation prior to the introduction of the Bill, so there is a great deal of work to be done as it progresses through the Committee. There is a very short time frame, and we are all being put under pressure to pass the Bill.

I have referred to the infrastructural problems. There is no doubt that the public wants to see a water service that works efficiently and provides for the utilities as it is supposed to. Behind all of this lies the question: has the Treasury put the Executive on notice that it will not allow us to continue subsidising Northern Ireland Water? That question needs to be answered. When it is answered, there will be a wider debate on how the issue is going to be handled. At the Committee Stage, the SDLP will continue to express very grave concerns about that. At least, we will try to open up a debate about it.

Photo of Brian Wilson Brian Wilson Green

I reluctantly support the Bill. It is disappointing that, after two years, we have not yet resolved the issue of how to pay for our water, and it is now necessary to rush this Bill through the Assembly to ensure that Northern Ireland Water can have funding in the new financial year. However, I recognise that we must keep that option open and we have to pass the Bill. If we fail to pass it, Northern Ireland Water could be left in April without funding. However, even if we pass the Bill, we should not assume that Northern Ireland Water will be funded automatically from the block grant in the next financial year.

I am opposed to water charges based on property values, which is the obvious alternative. They are grossly unfair and they fall heavily on the elderly and those on fixed incomes. However, I recognise that we must find an alternative means of funding the water and sewerage services. It cannot continue to be met from the block grant, as that would be at the expense of other services. Under the Barnett formula, there is no provision for water in the block grant. In the rest of the UK, consumers pay the charges directly to water companies and there is no call on public finance. Therefore, we get no money for the funding of Northern Ireland Water.

Northern Ireland Water must be funded from existing sources. The alternatives are to fund it from the regional rate or from the block grant. If the Executive decide to continue funding it from the block grant, it must inevitably mean a reduction in the resources available for other services such as housing, health and education. I highlighted that issue in my Budget speech in November 2007, when I pointed out that, because there was no alternative funding for water, the budget for the Health Service would have to be reduced — and that that would inevitably lead to cuts in service and significant redundancies. I pointed out at the time that the increase in the health budget was only 2·6%, which was the lowest for 10 years, and that, in practice, because of demographic trends and because NHS inflation is significantly higher than basic inflation, the 2·6% increase for the Health Service represented at best a freeze in overall expenditure, compared to a 4% increase in real terms for the Health Service in England. Funding our water means that there is less funding available for the Health Service.

The Budget also referred to new demands that we had to meet, such as those of the Bamford review. I was just at the learning disability —

Photo of David McClarty David McClarty UUP 12:15 pm, 29th September 2009

Order. Mr Wilson, the debate is about the Water and Sewerage Services (Amendment) Bill; please stick to the issue at hand.

Photo of Brian Wilson Brian Wilson Green

Yes; I am sorry, Mr Deputy Speaker. The Bill proposes that water and sewerage services be funded from the block grant. If that is done, there will be an impact on all other services. I feel that that is a perfectly legitimate argument to use.

The Independent Water Review Panel, which was chaired by Professor Paddy Hillyard, examined in detail the question of the funding of Northern Ireland Water. The Green Party welcomed that report. We had always argued that water services should be funded from general taxation, and, therefore, we supported the recommendation that there be no separate water charges. In accepting the report’s main recommendation, which is that the regional rate be frozen for two years, the Executive gave the impression that the problem of paying for water and sewerage services had been resolved. In fact, nothing had changed. Any public celebrations were premature. The issue has not gone away, and, as we now see, the money is not available for next year because we did not take any action on the Hillyard report.

Photo of Naomi Long Naomi Long Alliance

Does the Member agree that an opportunity to study in more depth ways to levy separate water charges fairly and affordably has also been missed? The assumption was that, because the charges were being deferred, they would not be implemented. We could now be facing a situation in which they are implemented in what is not a fair, affordable and transparent way, despite the fact that there has been a deferral.

Photo of Brian Wilson Brian Wilson Green

I thank the Member for that intervention. She raised one of the major points that I was going to discuss. We had the situation whereby we were going to introduce the charges based on property values. That would have been grossly unfair, because it would have hit the poor, the elderly, and those who are on fixed incomes. We should have been looking at alternative forms of funding at that stage. The fact is that the opportunity to find fair and alternative forms of funding has been overlooked. We are now left, in the few months that remain before the funding runs out, with having to rush this legislation through the Assembly. We should have been looking at other forms of taxation that are based on the ability to pay.

We should be looking at the Lyons and Burt reviews from Scotland and England on other forms of local government finance, for example. We should be considering options such as a local sales tax, a service tax, and green taxes that would help the environment as well as raise revenue and that would be based on the principle that the polluter pays. We should also be looking at something such as a land value tax. For the past two years, we have not taken the opportunity to consider the alternatives, and we are now being pushed into accepting that the charges will come out of the block grant. If that happens, it must inevitably be at the expense of other services. Therefore, we will see a reduction in those other services.

Therefore, although I support the Bill, I feel that we should not be rushing it through the Assembly. I hope that the —

Photo of Peter Weir Peter Weir DUP

I am curious about the Member’s assertion that the Bill is being rushed through the Assembly. There is no accelerated passage, and the Bill will have a full Committee Stage. How is it being rushed through the Assembly?

Photo of Brian Wilson Brian Wilson Green

As far as the business of the Committee for Regional Development is concerned, everything else has been set aside for the next month. I assure the Member that the parliamentary timetable is extremely tight.

In conclusion, I support the Bill, but I hope that we will find alternative ways of funding the services in question, because the present method of funding from the block grant or from property taxes is unacceptable.

Photo of Allan Bresland Allan Bresland DUP

Although the issue of water charges is one that gives rise to strong views and often heated debates, it is important to remember that the Water and Sewerage Services (Amendment) Bill is technical in nature and that we are debating its Second Stage. We are considering the principles behind the Bill. Those principles are concise and clear. We need the Bill if Northern Ireland Water is to be able to continue to provide a water and sewerage service and maintain its networks beyond next April.

If the Bill is not passed, we will have a real crisis, and water charges will have to be introduced from next April. There will be many more opportunities for a full and frank discussion on the future funding of water and sewerage services, but, this morning, we must control ourselves and limit our debate to the Bill that is before the House.

I support the Second Stage of the Bill, and I hope that the rest of the Assembly will do likewise.

Photo of Stephen Farry Stephen Farry Alliance

I am happy to support the Second Stage of the Bill. However, I want to follow up on some of the comments that were made by Mr Cobain, the Chairperson of the Committee for Regional Development, and by my friend Brian Wilson about the context in which the Bill is being progressed. There is a financial crisis facing Northern Ireland, and the Executive need to find major efficiency savings. Furthermore, it is clear that the Exchequer will call for further cuts at some stage in the future.

A lot of parties are engaging in cheap populism over the issue; they are taking stands and saying that there will be water charges in Northern Ireland over their dead bodies. I am not sure whether that approach is realistic and whether they are being frank with the people of Northern Ireland. In fact, one can foresee a situation in which we will be forced, under European Union directives, to introduce separate water charges. Leaving that aside, our current financial context may well mean that it is something that the Executive have to consider.

The Alliance Party has been consistent and straight with people on the issue. We have not ruled out a situation in which water charges may have to be introduced, and we were clear on that in our 2007 manifesto for the Assembly elections. The Executive have a duty to find efficiencies in what they are doing now, before they go down the path of water charges.

The Alliance Party stresses the importance of addressing the cost of division, and other parties have their hobby horses with regard to efficiencies. Therefore all those issues are in the mix, but one must be realistic and recognise that that may not be enough. The Executive will be faced with a choice. Put simply, and as Brian Wilson outlined, the Executive will have to consider whether to go for deeper cuts in public services or look towards the introduction of a form of water charging.

A lot of people talk about water charges affecting people who are in need or who are on the margins of society. That brings us to the whole issue of affordability and ability to pay: a water charge that is based upon the value of property will not properly reflect that. Neither would such a system reflect the relative usage of households. For instance, a situation could arise in which a single pensioner is living next door to a family of four adults who all earn a wage and who use a lot more water. It would be unfair to base the water charges for both households on the value of property. However, if we can find a fairer way of imposing water charges, it will be a progressive way of raising revenue.

On the other hand are people who are in difficulty because of their need for access to public services. They are often the most needy and disadvantaged people in our society, and they would not be eligible to pay water charges, if they were introduced. If steep cuts are imposed on the Health Service, those are the people who will suffer the most. When people talk about suffering and the disadvantaged in society, let us not focus entirely on the charges that the Assembly may or may not pass on to individuals; let us look at the nature and quality of the public services that we are funding and bear in mind that people are dependent on those and on a high quality of service.

If water charges are introduced, there is the issue of people paying twice for water, as part of the regional rate already covers water. If water charges are introduced, these Benches expect a proportionate reduction in the regional rate to account for the element that is currently being paid into the regional rate being transferred into any future water charges.

In broader terms, the deferral of water charges could be costing the Executive approximately £200 million a year, which is a considerable sum. It is the democratic choice of a devolved Executive to defer water charges, because, as Brian Wilson said, it does not form part of the Barnett formula. Therefore, the Executive are essentially taking money from the block grant to fund that deferral and are forgoing the opportunity of spending resources elsewhere.

The Assembly passed a Budget that was based on the initial deferral of water charges, but water charges have continued to be deferred without that Budget being modified to take into account the cost of that deferment. Therefore, decisions and announcements on water charges are now being made in advance of the budgetary and financial framework having caught up, and the Executive are having to find money in different areas to plug the gaps. That is not an appropriate or mature approach to the financial management of Northern Ireland’s scarce resources.

I appreciate that the Bill is designed to give options. I am happy for everything to remain on the table, but we must be realistic about where we are heading as a society. If the introduction of water charges is being considered, we must be straight with people; we must not lead them up the garden path by telling them that those charges will be withheld at all costs. Furthermore, if water charges are introduced, we must ensure that the system of charging used reflects people’s ability to pay and is based on their usage rather than on the value of their property. That system is a very blunt and, frankly, regressive form of taxation, which I hope all Members would reject; although I have my doubts.

Photo of Naomi Long Naomi Long Alliance

I concur with everything that my colleague said, and I will not repeat the points that he made.

The Water and Sewerage Services (Amendment) Bill, if passed, will allow the Department for Regional Development to continue to fund water and sewerage services, and the Alliance Party has no objection to that. What is now termed “water and sewerage services” was for a long time called public health engineering, and that was for good reason. The biggest improvement that we, as a nation, have witnessed in public heath came as a result of the introduction of proper water and sewerage services. Indeed, the introduction of those services probably made the biggest contribution to increased length and quality of life. Therefore, it is absolutely critical that we continue to fund that service appropriately for the future and to ensure that there is no regression.

Water charges, particularly separate water charges, are required under the EU water framework directive. That directive not only requires that separate charges be introduced, but the ethos behind the directive is that those charges should encourage water conservation. One of the problems with the previously envisaged structures to levying water charges here was that they were based on the price of a property, which has no reflection on the amount of water used. Therefore, water charging in that form does not fulfil the requirements of the directive. From the perspective of the Alliance Party, the question is not whether we pay for water but how we pay for water: charging must be fair, transparent, affordable, and also preferably and, importantly, it must be linked to usage.

The continuing deferral of water charges has created a sense among the public that the introduction of charges is not on the agenda. Therefore, I am glad that the Bill has come to the House, because it demonstrates that the Executive are not in a position to make the decision to defer water charges indefinitely at this time and in the current financial circumstances. I hope that it raises public awareness of the fact that the debate is ongoing.

The deferral has not, as I had hoped, bought time so that alternative approaches to levying fair charges could have been considered. Instead, it has simply put the issue on the back burner to be dealt with at a later stage, with no particular improvement to the kind of charges that are envisaged. That is an unfortunate wasted opportunity. As we agree the Second Stage of the Bill, I hope that work is ongoing in NI Water and in the Department for Regional Development to look at how charging — if it has to be introduced — is made fair, affordable and transparent and linked to usage. No one wants to pay taxes, but when we have to pay taxes — and we all recognise that we have to fund our public services — we want to know that those moneys are being dealt with affordably and accountably.

I want to raise one other issue, which relates to today’s Adjournment debate: the need for continued investment in water and sewerage services. We will be discussing the flooding that took place in my constituency and the investment required to deal with that. No doubt the Minister will be harangued by many Members at a constituency level for what are seen as the failings of the Department to deal with those issues. We have to be realistic and say that, without significant investment in the next five to 10 years, it is conceivable that the problems that we are experiencing locally will be more widespread and continue to cause problems.

There are difficult financial decisions ahead. However, we need to prioritise the issue of water and sewerage. Although it may not be one of the more glamorous aspects of our work, it is absolutely fundamental to public health, and it is important to focus investment in that area. As my colleague has stolen most of my thunder, I am happy to concur with what he has said and not repeat anything.

Photo of David McClarty David McClarty UUP 12:30 pm, 29th September 2009

The Business Committee has agreed to meet immediately upon the lunchtime suspension. I therefore propose, by leave of the Assembly, to suspend the sitting until 2.00 pm, when the Minister will conclude and wind up the debate.

The sitting was suspended at 12.32 pm.

On resuming (Mr Deputy Speaker [Mr McClarty] in the Chair) —

Photo of Conor Murphy Conor Murphy Sinn Féin 2:00 pm, 29th September 2009

Go raibh maith agat, a LeasCheann Comhairle. I thank all the Members who commented on the Bill. I welcome the support for the Bill from the Chairperson and the Deputy Chairperson of the Committee for Regional Development and from other Members.

Photo of Ken Robinson Ken Robinson UUP

On a point of order, Mr Deputy Speaker. I am sorry to interrupt the Minister in full flight, but do we have a quorum in the Chamber?

Photo of David McClarty David McClarty UUP

It is obvious from looking around the Chamber that there is not a quorum.

Notice taken that 10 Members were not present.

House counted, and there being fewer than 10 Members present, the Deputy Speaker ordered the Division Bells to be rung.

Upon 10 Members being present —

Photo of David McClarty David McClarty UUP

The Minister may continue.

Photo of Conor Murphy Conor Murphy Sinn Féin

Go raibh maith agat arís, a LeasCheann Comhairle. It appears that when Members are speaking to the media, these are important issues, but when it comes to debating them in the Chamber, they are not so important as to warrant significant attendance. Nonetheless, as I was saying, I welcome the support for the Bill from the Chairperson, the Deputy Chairperson and the members of the Committee for Regional Development and from most, if not all, parties.

The exception appears to be Mr Gallagher, although I am not sure whether he indicated that he would be voting against the Bill or whether his opposition to it means that his party proposes the immediate introduction of payments for water, because that is the only circumstance in which we would not need to extend the legislation. The main point of extending the subsidy provision is to maintain our water and sewerage services on a sound financial basis, and any other, wider decisions in relation to water and sewerage services will be taken separately.

Most Members who spoke understood and supported the purpose of and necessity for the legislation. I look forward to working with the Committee, along with my officials, during Committee Stage. It was interesting that some Members referred to the “rushed nature” and “compressed time frame” of the Bill. The Bill is following normal process, so I am not sure where those concerns arise. The Executive could have sought accelerated passage for the Bill, but they have brought it forward to allow the Committee to have its full say in the debate, as is rightly the case. The Committee will arrange its own timetable and programme of work to accommodate that, and I am grateful to the Committee for that.

I wish to respond to some of the issues that were raised. Mr Gallagher raised what he termed “serious concerns”. He alleged that there had been no debate on the issue, that I was unable to rule out charging for water, and he asserted that the public were bewildered. If there is bewilderment among the public, he should examine his own attitude, statements and record — and those of his party — on the issue over the past decade. I could go into the history and implications of the reform and reinvestment initiative, which was launched and lauded by his current party leader, Mr Durkan, and by the former First Minister, David Trimble.

I refer Mr Gallagher to a few points. If he is worried that a lack of consistency has bewildered the public, I suggest that he look to himself in the first instance to correct that. He berates me for not ruling anything out, but the last Finance Minister from his party said in 2002, around the time that he launched the review of rating and water policy, that:

“nothing has been ruled in and nothing ruled out…But we must be under no illusions, as private citizens we pay considerably less in local taxes than people do in England and, while it may be unpalatable, we may also have to accept that if we want better public services here we will have to pay more for them.”

When the Member is looking for consistency when debating these issues, he should look to himself.

Strangely, when his own party made a submission to that review, despite what its Finance Minister had said — it was during a period of suspension — the SDLP said that:

“water supply is a basic service…that we believe should be guaranteed to all and free at the point of use.”

However, in response to the panel that I established when I took up office, that party expressed its position as:

“no privatisation, no water-metering, no separate water charges or double taxation, but water revenue as a clear component of rates.”

In my experience, most of the parties have been quite consistent. If the public are bewildered because of any lack of consistency on the issue, the Member may wish to look to his own party to firm up the consistency. In the past few years, the SDLP seems to have advocated at least three different positions on the issue.

Photo of Conor Murphy Conor Murphy Sinn Féin

I notice that the Member is trying to make comments from a sedentary position. I am happy to give way if he feels that he has something intelligent to contribute to the debate. Obviously, he does not.

Mr Gallagher alleged that no debate has taken place on the issue, and he bemoaned that. He is free, at any stage, to bring a motion to the House for debate. I have not noticed that he has tabled such a motion. He is now a member of the Committee for Regional Development, and he is free to raise the matter through that Committee.

He must be clear in his facts. Some of his statements were factually incorrect, which for any Member would be worthy of criticism, but it is hard to understand how a member of the Regional Development Committee could be incorrect with their facts. He stated that the Executive had introduced business charges and that they had implemented them at 100%. Neither part of that is true. Most non-domestic customers have had water charges for years. They were not introduced by the present Executive, which unanimously decided to keep those charges at 50%.

If Mr Gallagher wishes to assist with what he believes to be some degree of public confusion, perhaps he should table a debate on the matter, but he should be sure of his facts and be consistent on his position if he does so. The Executive, on which his party is represented, unanimously decided on the issues.

In response to Mr Hamilton, he said that “we have a strange democracy” where a party is obliged to take a position in one forum but can take a different position in another forum. Indeed, it is a strange form of democracy when the SDLP’s representative on the Executive can vote for a certain position and the party feels free to adopt a completely different position in the Chamber and in front of the general public. If Mr Gallagher feels that the public are bewildered, I suggest that he might look to address that.

Mr Gallagher raised a few other points in relation to billing errors. NIW has taken steps, in consultation with the Consumer Council, to address that. Improvements to data and to systems are being made in conjunction with the regulator, and I certainly welcome those. Mr Gallagher also raised the issue of the draft determination from the regulator that NIW had asked for too much money. The regulator’s document is only a proposal, which is subject to consultation, and my aim is to ensure proper engagement between the regulator and Northern Ireland Water to get the right level of resources so that adequate water and sewerage services can be provided and to make up for the historic underinvestment in those services.

Brian Wilson said that the legislation was being rushed through. Given that the normal processes for putting legislation through are being followed, I am at a loss to see how he can describe the legislation as being rushed. He spoke for some time about the unfairness that he felt about different ideas that have perhaps been suggested by him and other parties. I have certainly not suggested those ideas. He said that alternative means had to be found, and I waited patiently to hear those. He quickly rattled off a couple of suggestions to do with using land taxes and green taxes. I have never heard the sole representative of the Green Party put those ideas forward for debate on the Floor of the Assembly, and he has never brought those ideas to my attention. If the Member has ideas on how water and sewerage services should be funded, I am sure that the Assembly and the Executive will be pleased to hear them. Two and a half years into the process, the Member has made a few offhand remarks.

Photo of Brian Wilson Brian Wilson Green

I made all of those points during the debate on the Budget in November 2007. At that time, I called for a review of how local finance should be funded, and I went into the details of each of those proposals. My concern is that nothing has been done since then. We have to look at alternative sources of funding.

Photo of Conor Murphy Conor Murphy Sinn Féin

The Member’s suggestion that nothing has been done is incorrect. We are doing something now: we are extending the legislation to allow the Executive to continue to cover the additional costs of water and sewerage services. That is the third decision that we have taken in relation to this. When I took office, Sinn Féin had the position — similar to those of many parties, although some of them have wavered back and forth — of being opposed to the direct rule propositions on water charging.

My party opposed privatisation of the Water Service. It wanted a full inquiry so that the costs that are required for water and sewerage services can be ascertained and so that a degree of transparency can be brought to the matter.

Every one of those pledges has been delivered. The Executive have stopped the direct rule proposition for water charges. They gave the independent panel a remit that would rule out the privatisation of water services. They brought forward the panel’s report, which continues to be the subject of debate on all matters that are connected to the requirements for water and sewerage services.

Therefore, if the Member has alternative propositions, I would certainly be glad to hear from him. If, as he says, the Executive have done nothing on the matter since the Budget debate in November 2007, I would not be in the Assembly debating a piece of legislation that would allow us to continue to do what we have been doing.

Dr Farry and Mrs Long raised a number of wider issues about water payments, and they pointed out that the Executive have never advocated double payments for households. The Independent Water Review Panel’s proposals addressed that. The Executive have yet to decide on any methodology for household payments. As is the case with any other Executive decision, we have a made the commitment to consult publicly on anything that we do.

Therefore, a LeasCheann Comhairle, I trust that I have dealt with a number of points that were raised in the debate. As I said, I am somewhat at a loss when Members say that the issues have not been debated; I have discussed them on many occasions in the Assembly. Of course, Members are free to table any motion on those matters that they so wish, and I am sure that the Business Committee would consider the merits of any of those motions for debate.

Certainly, as I said at the outset, the Bill proposes to allow the Executive to continue the current funding arrangements. Since they came into office, the Executive have made two decisions: first, to continue those arrangements; and secondly, to extend that ability to ensure that the necessary investment — which, in many ways, is catch-up investment — in water and sewerage services that was not made under direct rule continues to be made.

Of course, the Executive will continue to struggle with all the financial issues that face us. However, the Bill allows us to continue to make that subvention to Northern Ireland Water.

Question put and agreed to.


That the Second Stage of the Water and Sewerage Services (Amendment) Bill [NIA 3/09] be agreed.