POPULISM, POOR decision making and cowardice infect Irish politics and have brought the State to the brink of financial ruin on three occasions. They are once again in action. This time, the reintroduction of water charges – abolished under political pressure in 1996 – has exposed incompetence, confusion and disagreement within Government, opportunism within Fianna Fáil and outright rejection by Sinn Féin and United Left Alliance. The impression of dithering Ministers and Opposition politicians who appear to believe a tooth fairy will pay for public services is unmistakeable.
It was unwise to abolish, rather than reform, water charges in 1996. The same mistake was made on domestic rates 20 years earlier. Both taxes were abandoned in search of political advantage. And both decisions seriously undermined the functioning of local democracy. On a national scale, they narrowed the tax base and helped to engineer the current shortfall in revenue over expenditure. The OECD, the ESRI, the Commission on Taxation, and other organisations, have urged their reinstatement in some form.
Following the shambles that marked the Government’s introduction of a property charge, a degree of caution might have been expected from the Department of the Environment in advance of formal Cabinet decisions. Not a bit of it. As a consequence, Labour leader Eamon Gilmore came under pressure at his party’s conference and Taoiseach Enda Kenny caused uproar when he suggested homeowners would have to pay for the cost of water meters, but not for their installation. Later, it was suggested the cost of meters would be spread over 20 years.
The political sensitivities involved go back a long way. It was a Fine Gael/Labour government that abolished water charges. When Fianna Fáil and the Green Party proposed a metering system with free household allocation in 2009, Labour opposed it and Fine Gael lamely said it would make its position known after the general election. In 2010, John Gormley and the Green Party said water bills would issue by 2012. With an election looming, nothing happened. But the EU-IMF troika was assured water charges were on the way.
Since taking office with a commitment to establish a national water authority, progress has been woefully slow. Yesterday, Ministers finally agreed to establish Irish Water as a subsidiary of Bord Gáis. How that will affect plans to sell the retail side of the energy company is unclear. Water charges were to have been introduced by 2014, at the latest. Now, with a commitment to postpone charges until meters have been installed, that target looks unreachable. A lack of vigour by Minister for the Environment Phil Hogan has been paralleled by the Labour Party’s lack of appetite for humble pie and economic reality. These disagreements and misjudgments have consequences. Because of uncertainty over contentious issues, the Government’s stance on reform is being eroded. Increasingly, there are challenges to its authority. Ministers had better shape up.