Government likely to be left with entire €65m storm damage bill

The Government is likely to be left with almost the entire multimillion-euro repair bill for recent storm damage, with only modest European compensation now a prospect.

Although the Cabinet decided two days ago to seek aid from a special EU relief scheme, a big funding cut this year and a succession of relatively small compensation awards to other stricken countries suggest the Government will have to shoulder most of the burden. This is in spite of acute pressure on the public finances.

The initial estimate of storm damage over the Christmas period to public amenities in Clare, Galway, Waterford, Mayo and Kerry stands at €65 million. Damage to private property, typically covered by insurance, has been estimated at up to €250 million.

While efforts are under way to pin down the exact sum, the total damage must exceed €800 million for Ireland to qualify for aid from the EU Solidarity Fund for major natural disasters.

The Government has the right to ask the European Commission for compensation from a separate scheme for extraordinary "regional" disasters, but only one-third of applications for such aid are successful. The damage must be shown to affect the majority of the population in a region with "serious and lasting repercussions" to economic stability and living conditions.

Damage assessments
A spokesman for the Department of the Environment said it remained the Government's intention to proceed with the request, adding that it would not pre-empt the process before local authorities complete their damage assessments.

“We’ll await the detailed responses from the local authorities and a decision will be made in relation to an application in conjunction with the Department of Finance/Department of Public Expenditure,” the spokesman said.

The last Government received €13 million from the EU fund in 2010 for €521 million in flood damage in November 2009, €278 million of which was shouldered by the State.

The EU fund has been cut by roughly half to €540 million this year. Germany incurred flood damage totalling €8.2 billion last summer and received a compensation award from Brussels three months ago of €360 million. At the time, Austria was awarded €21.6 million in respect of €866 million in total direct damage.

A European Commission source said the fund has “never been able to shoulder the full amount”, even more so when funding for the scheme had been cut back radically.