Transcript Water Services National Training Group

Water Services National
Training Group
10th Annual Conference
7th September 2006
WSNTG Annual Conference September 2006
Water Services –
Funding Non-Domestic Capital
Contributions
Jack Keyes
County Manager
Cavan County Council
WSNTG Annual Conference September 2006
Strategic Issues
 Balanced Regional & Local
Development
 Increasing Population
 Political / Business / Farming
 Government / Local Authority Finance
 Efficiency of Delivery / VFM
 Partnership between Central & Local
Government
WSNTG Annual Conference September 2006
Summary of Main Effects Financial
 Significant effect on Local Government
Financing
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–
–
–
–
–
–
Borrowing (Quantum / Approval)
Risk
Cash Flow / Overdraft
LGF Fund
Price/Dev. Contribution Increases
Social / Affordable
Rates Income
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Socio Economic Planning
 National Spatial Strategy
– “To strengthen establishments of structured villages
& small settlements”
– “Alternative for those wishing to live in rural
community”
 Sustainable Rural Housing Guidelines
– “Development of towns & villages…
attractive & affordable housing options”
 Regions currently lagging
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Political
 Farming
 Business – IBEC / Chambers Ireland
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Chambers Ireland
Water Service Charges for Business 2006
Recommendations
 Local Authorities should charge all water users
 Compulsory metering in planning permissions
 Reduce commercial rates in line with full cost
recovery
 Agree increases above inflation with business &
farming community
 Transparency (including all contributions from
business community)
 Increased funding of local government including
a move to locally based sources
 Charge all for everything
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Typical Small Village
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 Incentivisation of water users
 Regulatory framework
 Shared services / national and
regional bases
 Structural & Informational charges
(audit committees)
 Ongoing review of local authority
services (DPG’s and water)
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Chambers Ireland - Findings
 Metering target end 2006 will not be reached by
11 Councils
 Variation in costs for metering (zero to
€680/annum)
 Consolidated charges varying from €0.77 to €4.55
 Current expenditure of water services increased
from 11.53% to 13.4% of overall revenue
expenditure
 Current income from water charges varied from
an average of 3.64% to a maximum 6.51% of
overall expenditure
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Water Services Investment
Programme 2006 - 2011
Water
Wastewater
Total
=
=
=
€ 64.9 million
€ 55.7 million
€120.6 million
Council contribution
=
€ 36.9 million
Funding Source
–
Financed by
–
Development Levy Water
Charges
20 year loans
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Capital Repayments
YEAR
REPAYMENT
2006
€
245,611
2007
€
989,044
2008
€ 1,880,035
2009
€ 2,192,191
2010
€ 2,374,891
2011
€ 2,558,635
2012-2026
€38,379,525
2027-2032
€10,018,179
TOTAL
€58,638,115
20 Year Loans at 3.5%
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Impact On Rates
YEAR
REPAYMENT
RATE INCREASE
(€51.56%)
2006
€
245,611
+ €1.77
2007
€
989,044
+ €7.11
2008
€ 1,880,035
+ €13.52
2009
€ 2,192,191
+ €15.76
2010
€ 2,374,891
+ €17.08
2011
€ 2,558,635
+ €18.40
2012-2026
€38,379,525
+ €18.40
2027-2032
€10,018,179
+ €12.01
TOTAL
€58,638,115
+ €16.22 average
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Funding
 Water Charges (50%)
=
€29.3m
 Development Levies (50%)
=
€29.3m
+ Small Schemes Contribution
+ Serviced Land Initiatives
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Water & Wastewater (m3)
Year
Water
Wastewater
Total
2006
€0.70
€0.66
€1.36
2007
€0.88
€0.80
€1.68
2008
€1.06
€1.00
€2.06
2009
€1.13
€1.06
€2.19
2010
€1.20
€1.11
€2.31
2011
€1.27
€1.17
€2.44
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Water & Wastewater
Development Levy
NETT UNITS
LEVY
3,950
€9,785
4,702
€8,220
5,276
€7,326
7,963
€4,854
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Possible Responses Of
Local Authority
 Cease development of small towns &
villages
 Cease development of certain larger
conurbations
 Adopt shorter design periods / modular
approaches
 Significantly increase development
charges / water charges in under
developed regions
WSNTG Annual Conference September 2006
 Also could:
– Improve efficiencies, systems and VFM
approaches
– Increasingly involve private sector/other
delivery mechanisms as appropriate
– Improve transparency / dialogue with
business & farming interests
– Develop shared services approaches
– Incentivise customers
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Future Challenges
 Water services runs like a business
– Enhanced technical and management excellence
(25% UFW/PPP’s)
– Attitudes and systems re-aligned
– Consistent and comprehensive cost centres (e.g.
building depreciation)
– Profit in all but name
 Better mobilisation of Regional & National Networks
 Deepened partnership between DEHLG & Local
Government
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 Clarity of Integrated Strategic thinking at
Central Government Level
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Increasing population
Consistency of approach to water pricing
Borrowing CAP
Funding of Local Government
Linkage with River Basin District Management
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