Why water charges threaten to sink the Government

Water charges were close to falling off the political agenda 10 days ago. Fine Gael was tweeting its delight at an agreement. Sinn Féin was claiming credit.

It appeared a deal on the water issue had been done. Now the divide is so deep there are genuine fears of an early election.

What caused the deal to become undone? Did Fianna Fáil mislead their Fine Gael colleagues and cynically tear up the agreement? Or was it a mysterious hardening of attitude from Fine Gael over the course of a weekend, driven by criticism from Leo Varadkar, that Simon Coveney's proxies on the committee had struck a poor deal?

What is indisputable is that within moments of the committee reconvening last Tuesday, the agreement was in shreds. Fine Gael called a vote on the first line on the first page of the report.

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By the end of the week, Fianna Fáil had aligned itself to the other side, the Right 2 Water representatives on the committee (led by Sinn Féin and Solidarity’s Paul Murphy), and supported many of their amendments.

Whatever trust either party shared was eroding to such an extent that a breach of the confidence and supply agreement seemed a possibility. If that were to happen, then the shutters would come down on this Government.

The only unknown when the committee went into private session was about where Fianna Fáil stood. For a long time, its lead negotiator Barry Cowen played his cards close to his chest.

Then last month, Cowen announced the party wanted to fine people who wasted water but not bill them. Fine Gael members were visibly stunned.

This led to intense behind-the-scenes negotiations between Cowen and Coveney and they eventually thrashed out the makings of a deal.

Both parties had agreed the top 8 per cent of users would face sanctions. These were people who used more than 1.7 times the average.

That caught about 70,000 households. Fine Gael was happy this would conform with the EU’s water framework directive and the polluter pays principle.

The party felt that the deal was sealed last Thursday. Before sharing it with his party, Coveney wrote down by hand the eight points of agreement.

The main ones were: Irish Water would be a single utility; water meters would be installed in new-build houses; an excess usage charge would apply for 170 per cent above average usage; the target would be the 8 per cent of households (who use 32 per cent of all water); and there would be no prosecutions for excess usage, rather fines.

He rang Cowen again and went over the eight points, ticking each with his pen when he was reassured.

All seemed well with the world. Sinn Féin’s Eoin Ó Broin agreed on radio that a deal seemed imminent. Coveney tweeted congratulations to the Fine Gael negotiators that evening.

Key differences

That might well have been it, but there were key differences in their interpretation of events.

For one, there was no agreement on the method of calculating excessive usage. Fine Gael favoured a per household figure. Fianna Fáil wanted a per person figure of 133 litres a day. Fianna Fáil argued the Fine Gael proposal would discriminate against small families.

For its part, Fine Gael argued that the Fianna Fáil proposal was so generous, no households would be prosecuted.

The second unresolved issue was over meters. Fianna Fáil had made a big concession agreeing meters for new builds.

However, the party did not agree that they be used as to calculate water bills, but mainly to identify leaks and conservation.

Fianna Fáil’s original proposal was to use the Water Services Act 2007 as a sanction for excessive use of water. Under this Act, people are prosecuted in the courts under criminal law.

Fianna Fáil had agreed to amend the 2007 Act to allow charges rather than prosecutions, but crucially it never agreed to meters for that purpose.

Was there another dynamic at play? An article appeared in the Sunday Business Post in which Varadkar was reported to have criticised Coveney’s deal, saying the party would be ridiculed if it sold it as a “win”.

Unnamed Fine Gael TDs were quoted as being unhappy with an outcome where only 8 per cent of people would pay.

Did that spook Coveney? Not at all, said those close to him or the party delegation. They maintained that the reaction within Fine Gael was really positive.

However, the tone of the Fine Gael delegation at Tuesday’s meeting gave the lie to that.

Within seconds of arriving, negotiators Martin Heydon and Colm Brophy looked for changes on the very first line.

“Their tone was completely different and so was their body language. To everybody else, it was clear they wanted to tear up the whole thing,” said another member.

As every amendment was examined, the Fine Gael team made contact with Coveney seeking his guidance and clearance.

Excessive charges

Other committee members could not understand the fuss. Independent TD Thomas Pringle said the members were given a report on Wednesday morning outlining their position on excessive charges. The final draft report on Monday contained the same recommendation.

The only difference was that the proposal to calculate wilful wastage was set at 70 per cent above normal usage.

The atmosphere became hostile and the incipient deal was now unravelling.

Over the course of the next two days, Cowen began to side with Sinn Féin and Solidarity on all the key issues.

Key words were stripped out of the document. General taxation would cover “normal domestic water use”. Fianna Fáil supported Sinn Féin in removing the distinction between normal and excessive use.

It no longer used “excessive usage” as a phrase, instead resorting to the higher threshold “wastage or wilful use”.

The average domestic use in the final document was 133 litres per person per day, the Fianna Fáil measure, not the Fine Gael one.

Fianna Fáil withdrew its agreement to having water meters in all new builds. “That was a big flip-flop. It really f***ed Fine Gael over on that one,” said a non-aligned member of the committee.

Fianna Fáil actually agrees. It said it did that because it was the only way of getting an agreement over the line (with the support of the other side).

There were three sets of legal advice circulating, one from Fianna Fáil, one from Sinn Féin and one from senior counsel David Nolan, who was consulted by the committee as a whole.

None has raised red flags so far over what has been agreed. Fianna Fáil said the language of the report did not matter. What matters is the legislation.

On Tuesday, Cowen and Coveney communicated by text. The party’s chief advisers were also in contact. Yet there was no progress.

Both parties are now getting restless. Cowen does not have the full support of his party, with many from within questioning his doggedness on an issue that won’t go away.

Cowen’s friends in the party believe he is becoming the fall guy for party leader Micheál Martin’s demands.

Fine Gael, on the other hand, wants this to be sorted out. Its members are supportive of Coveney’s position but are also insistent that he cannot cave in to Cowen.

Late on Thursday night, the Minister wrote to the committee essentially chastising it for the U-turns.

Fine Gael was also calling for the Attorney General to review the report to see if it complied with the EU water framework directive.

The result is a political mess. There is a brief reprieve until Tuesday to allow further legal advice but unless a rabbit can be pulled out of a hat, Coveney will be faced with the humiliating task of drafting legislation for something to which he is fundamentally opposed.