Report of the Local Government Efficiency Review Group

legislation provides that arrears of water charges can be made a charge
against the property where the recipient of the water service is the owner of
the property. However, the Group recognises that, as the majority of
commercial water customers are tenants or leaseholders, alternative
approaches are required for the late payment of charges by commercial
enterprises where the property concerned is a rented property. For this
reason, the incrementally increasing non/late payment penalty approaches
of the NPPR should be considered.
13.3.8 It is not possible at this stage to put a specific figure on the possible income
that would accrue to local authorities. However, given the considerable
arrears outstanding, if successful, such changes could lead to significant
savings for local authorities in terms of both arrears collected, and the costs
associated with revenue collection. The more that can be collected
automatically, or at source, the greater the certainty of revenue collection
and the lower the administrative cost.
13.4 Local Taxes and Charging
13.4.1 The 2009 renewed Programme for Government and the 2009 Commission
on Taxation report proposed both the introduction of an annual local tax on
residential land and the reintroduction of domestic water charges (see
section 4.3). The Commission on Taxation estimated that their proposal for
an annual tax on residential property would raise in the region of €1 billion
per year, although the exact figure would depend on the rate set. The
Commission further suggested that the levying of domestic water charges
could raise a further €450 million, although this did not take account of a
potential decision to allow domestic users to use a certain volume of water
free of charge.
13.4.2 In December, the Government gave approval in principle for the Minister for
the Environment, Heritage and Local Government to commence the
preparation of legislation to remove the prohibition on charging domestic
users for water services and to provide a legal framework for local
authorities to charge for the provision of water services. It is intended that
water charges will be based on volumetric usage, and will involve the
installation of water meters in households connected to a public water
supply.
13.4.3 It should also be noted that there could be a significant lead-in time before
both proposals can be implemented, particularly if the models of taxation
and charging adopted depend on property valuations and water metering.
Installing domestic water meters will also involve a significant upfront
investment. Proposals are currently being finalised on the delivery of a
water metering programme. Given the scale of the metering programme, it
is envisaged that it would take approximately five years to install water
meters in all households in receipt of public supplies. The cost of the
metering campaign is estimated to be in the region of €500 million based on
the recommended approach. The estimate does not include other costs
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