Irish Water parent company defends €100m extra for meters

The installation of water meters cost € 100 million more than originally planned because the first estimate was carried out before the utility tendered for the contract, according to the chief executive of Ervia, parent company of Irish Water.

Michael McNicholas said the original estimate of € 431 million was arrived at in late 2012 when Bord Gáis was asked to put together an estimate of what they felt the overall metering programme would cost.

The final budget of € 539 million was arrived at after finalising prices with contractors in May 2013.

"There's only ever been one budget for the metering programme. And that is the budget that was finalised in May 2013 for € 539 million," he told RTÉ radio.

“In late 2012 the Deptartment asked Bord Gáis as it was at the time to put together an estimate of what they felt the overall metering programme would cost. They did that late 2012 as I said and came up with an estimate of €431 million. That is an estimate and it was very clear when they made that estimate that the final figure for this project would only be arrived at as a result of going to the market and tendering for the contract,” he added.

Mr McNicholas said the €100 million difference between the estimated and final figure was as a result of survey details coming back from local authorities which increased the amount of labour and materials needed; moving to the decision to spread the work out over more contractors over more regions in order to have more control over the quality of the work; and contractors refusing to sign up to the price they had bid forcing a move to the next contractor which increased the overall price.

He said half a million metres had been installed with another half a million to go. Work has stalled in “about half a dozen” places mainly in the Cork and Dublin areas due to protests, he said.

Mr McNicholas committed to have the 20,000 people currently on boil water notices off them by June 2015.

He also said he was stepping down from his role on the advisory committee of National Toll Roads (NTR) and divesting shares he holds in that company.

He said even though the role was not in conflict what his role in Ervia it was “no longer appropriate” to sit on the committee.

"We have not gained the trust and confidence of the public with regard to Irish Water … we need to build trust and as group chief executive of Ervia if there is any perception, no matter how misguided it is, of wrongdoing, and an article in the Mail on Sunday did insinuate wrongdoing on my part, then we need to deal with that," he said.