Uisce Éireann told the government that €1 billion given to it in last year’s budget does not provide additional funding for the utility, saying this was “in direct contradiction” to the impression given to the public.
In its last budget before the election, the outgoing coalition said it was allocating billions from the proceeds of AIB share sales to provide additional ringfenced funding for capital spending – including €1 billion for Uisce Éireann.
However, in a letter sent to former minister for housing Darragh O’Brien after the budget, the utility’s chairman said the money would provide no extra financial firepower in the coming years.
[ Water system ‘in a desperate state’, says Uisce Éireann chairmanOpens in new window ]
Jerry Grant told Mr O’Brien that the €1 billion would be used to avoid increased borrowing by Uisce Éireann, and also told the then government that the utility would have to use some of the money immediately to fill a €300 million funding hole in its budget allocation for 2025.
“As you are aware, [the €1 billion] did not represent ‘additional funding’ but was provided in lieu of a new debt facility from the Department of Finance to UÉ.”
He outlined that the money would form part of its funding mix for the period 2025-2029, which had been included in a strategic funding plan it had provided to the government – and had already been fully allocated to investments.
“The €1bn capital contribution therefore does not provide any further funding to UÉ to allow the delivery of additional infrastructure.”
This is in direct contradiction to the message that this is “additional funding” that has been allowed to permeate within government circles, industry and the general public and we need to address the implications of this”, he wrote.
Uisce Éireann has come under severe political pressure in recent months amid suggestions that it is not moving quickly enough, which in turn is holding up housing. It is locked in negotiations with the Coalition seeking another €1.7 billion to help it do so.
Mr Grant has previously said the State‘s water and sewerage systems “are in a desperate state” because of “extraordinary complacency” and “passive indifference”, warning that a new approach from the Government is needed if targets of 50,000 homes annually are to be met.
The Opposition rounded on the Government in reaction to the details in the letter, released to The Irish Times under the Freedom of Information Act.
Sinn Féin housing spokesman Eoin Ó Broin said the revelations were “very serious and deeply concerning”.
“Now we learn that this is not extra funding at all, just a different way of funding the current programme.” He said the Government had “deliberately misled the public on this crucial issue”.
Labour finance spokesman Ged Nash said the announcement was a “three-card trick and has all the hallmarks of another pre-election sleight of hand effort from Fianna Fáil and it is up there with their misleading election campaign claims of 40,000 home completions in 2024”.
In response to queries, an Uisce Éireann spokesman confirmed that the views outlined in the letter are unchanged. He said it sought clarity on how the funding was to be accessed after the budget, with the Department of Housing saying it was “to be used towards our pre-existing capital funding requirements from 2025 to 2028“.
“The €1 billion funding announced as part of Budget 2025 is therefore incorporated in the €16.9 billion requirement in Uisce Éireann’s Strategic Funding Plan.”
He said the utility company is engaging with the department and seeking a further €1.7 billion to 2029 in ringfenced funding to build infrastructure, as well as improvements in the planning and consenting process.
A Department of Housing spokesman said that the funding requirements for Uisce Éireann over the period to 2030 will be considered in the context of the review of the National Development Plan to be completed before the end of June.
