5 January 2005
SPELLAR MEETS SDLP ON WATER REFORM ISSUES
DRD Minister, John Spellar, met today with an SDLP delegation to discuss the Government’s Water Reform proposals.
Following the meeting, the Minister said:
"The SDLP outlined to me today their concerns in relation to the proposals that the Government has put forward to the reform of Water Service, in both how it is to be financed and delivered. I will be considering the points that they have made.
"I hope however that I was able to offer reassurance on some areas, including their opposition to the privatisation of Water Service and also the introduction of universal metering.
"Firstly, I reiterated what I have said consistently in the past and that is that privatisation has been ruled out for the foreseeable future. I also pointed out that, while I have agreed to give further consideration to the way in which metering might be part of the charging process, I would caution against it being considered as the panacea that some have suggested.
"I realise of course that the SDLP have taken a stance of direct opposition to the introduction of water charges as a means of funding the £3 billion of investment required over the next twenty years.
"I also know, however, that they accept the need for that massive investment in water and sewerage to take place. The previous Executive acknowledged in their consultation document on Rating Reform that there was no realistic prospect of increased funding from the Exchequer while household charges contributions here are so comparatively low, even taking into account regional variation in incomes and costs of living.
"The figures speak for themselves. The average rates bill here is just over £500 whereas, elsewhere in the UK, average household bills for property taxes and water charges are around £1200.
"In that event, I have yet to hear how an alternative to the introduction of charges can be found which does not mean money being diverted from other services such as health and education.
"Like the delegation that I met today, I would much prefer that the difficult decisions that have to be taken were in the hands of a devolved administration but I did stress that we cannot put off those decisions.
"This is not an easy choice and we fully recognise that charges will mean a further burden for households here. But that is why we are proposing to phase them in over three years and to provide protection to those on low incomes."
Mr Spellar added: "Those wishing to maintain the status quo by continuing to finance water and sewerage services from public expenditure should recognise that would mean:
- £50 million of planned spending allocations for other public services in 2006-07 would be lost as set out in the budget document;
- from 2008-09 the potential of around £300 million per year for other public services would be lost;
- the RRI borrowing concession, which is currently providing £200 million per year for capital investment for all other public services would be lost; and
- a further £50 million or more would be needed to be found from other public services for 2007-08 onwards, to cover the cost of water and sewerage depreciation and capital charges, a figure which would rise rapidly over the next decade and beyond."
NOTES TO EDITORS:
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