Debate contribution: NI Water: Funding and Governance

Debate contribution by Ms Liz Kimmins on 29 April 2025.

MLA

Ms Liz Kimmins

Party at the time

Sinn Féin

Date

29 April 2025

Type

Debate contribution (made as a minister)

Business

Opposition Business

Heading

NI Water: Funding and Governance

Assembly identifier

Official Report component 4922299

Read the official Assembly record

Text

Go raibh maith agat, a Phríomh-Leas-Cheann Comhairle.

I thank the proposers of the motion on NI Water's funding and governance and those who tabled the amendments. The issue is well rehearsed. I have lost count of the number of times that we have had these discussions in the three months that I have been in post. That is not to underplay the issue's importance, because it deserves a focused debate. Members will be aware, and many have mentioned in the debate, that I and my predecessor have been proactive in working to find solutions by means of a three-pronged approach, whether or not they agree with that, and some have indicated that they do not. I thank Mr Carroll for his comments about keeping NI Water in-house: that is our focus, and it is critical to ensuring that the people whom we represent get the service that they are entitled to and deserve. We have seen examples where other approaches have not worked elsewhere. For me, that is fundamental to how we move forward on the issue. Before I address the motion specifically, I remind Members that NI Water was established in 2007 as a government-owned company to provide water and sewage services across the North. Since its establishment, it has been the Executive's policy to provide subsidies to NI Water in lieu of domestic water charging. Since 2007, some £4 billion of public money has been invested in the water and waste water infrastructure in the North, and NI Water has reduced its efficiency gap compared with similar companies in England and Wales from 49% in 2007 to 5% today. As an arm's-length body sponsored by my Department, NI Water is required to deliver on three key areas: to provide a high-quality service that is independently regulated by the Utility Regulator, protecting the interests of consumers by challenging NI Water to deliver high-quality, value for money water and sewage services; to adhere to the requirements of a public-sector organisation, delivering services for all people across the North within the allocated budget and with due regard for statutory obligations; and to be accountable to my Department and the Assembly for its operational and financial performance and compliance with 'Managing Public Money NI'. My Department has fully funded NI Water for the first three years of the current price control period. Indeed, my Department has provided almost £90 million of additional funding over and above the funding level that was recommended by the Utility Regulator for that period. The key issue is the level of public expenditure that is available to the Executive, not just my Department, to allocate to NI Water. That is a consequence of the underfunding of public services in the North over many years. I am glad to say that, previously, all parties were united in engaging with the British Government to try to resolve the issue. That, however, seems to have been forgotten about in today's debate. I hope that parties will continue to push for that, because it benefits all our Departments and every service that we deliver on a daily basis. The motion and the amendments raise important issues around the impact of austerity funding on a vital public service. I am committed to working to find solutions — whether or not others agree with those approaches — within my Department's overall policy framework and the Executive's policy for funding NI Water from the public purse. It must be recognised that, because NI Water is majority funded from the public purse, it is classified as an organisation within central government and subject to government accounting rules, as I said, as defined in 'Managing Public Money NI'. All NI Water's expenditure must come from within the public expenditure envelope that is provided to my Department. In 2024-25, NI Water was provided with nearly £500 million of public money, representing almost 40% of the non-ring-fenced funding budget that was provided to my Department. It is necessary to remember that NI Water's spending also includes borrowing from my Department. As a public-sector organisation, regardless of the source of borrowed funds, whether private or public, all expenditure must be within the allocated budget. The Assembly previously debated a review of NI Water and discussed alternative company structures such as mutualisation, which we have heard about today. The simple fact remains, however, that changing NI Water's status will require a change to how it receives its revenue. I do not need to remind Members that I will not oversee the imposition of water charges on people and families who are already struggling in the midst of a cost-of-living crisis. The ideas that have been proposed in this debate, in previous debates, in questions for written answer and in questions for oral answer all lead to one thing: water charges. I will focus on some of the issues that Members have raised during the debate. It is important to go back to Patsy McGlone's opening comments about successive Sinn Féin Infrastructure Ministers. I remind Members that Sinn Féin has held the Infrastructure portfolio for less than two of the past three years. Previous to that, there was an SDLP Infrastructure Minister. That seems to have been forgotten. The challenges have not just arisen in the past two years. Successive British Governments have continually underfunded us. The cost of delivering on the issues has almost doubled in the time since the latest price control period started.

I appreciate the Member's comments, but the point that I am making is that this is not an issue that has just arisen. Rather, it is an issue that has come about as a result of chronic underinvestment, and I think that we are all in agreement on that point. If the solution were as easy as Members have today made it out to be, we would be using that solution, but it is not. The SDLP said yesterday and today that it is on the same page as me in not wanting to introduce water charges, but I am yet to hear what the other options are.

I need to get through this. My time is limited, Matthew.

You did not mention any new options, however. What we have heard to date is mutualisation, privatisation and nothing else. I have put my approach on the record, and I will continue my work. I will return to your comment, Matthew, about borrowing and getting first call. We had first call on reinvestment and reform initiative (RRI) borrowing this year. Unfortunately, it is capped by Treasury. This year, we got £105 million, which has gone to NI Water from the Executive, so that is an indication of how important that is, not just to me as the Minister and my predecessor but to the Executive as a whole. I will turn to the comments from Alliance and DUP Members. We have talked about mutualisation. One has just to look at Welsh Water. I met the Utility Regulator earlier this afternoon, and I look forward to continuing that engagement with the Utility Regulator and with NI Water, because, collaboratively, we can achieve progress on the issues. Welsh Water is an example of how mutualisation is not working. People in Wales are seeing, I think, a 27% rise in their bills in this financial year. Is that what we are proposing today? On the comments about developer contributions, I have said, at every stage at which I have discussed them, that I do not believe that they are a silver bullet. Rather, they are part of a broader solution, and we have to consider all the options. This is about looking at what is available to us. What have we got in our armoury that can make a change? It is then about working together to make that change. The only other option that I am hearing today is to introduce more charges, meaning more bills for hard-pressed families, and that is something that I am not prepared to do. Perhaps others are, but, if they subsequently take the Ministry, so be it, and they can consider introducing them in the time ahead. In that vein, I will focus on the positive outcomes that can be achieved from the funding envelope that is available. I mentioned the three-pronged approach, and we have seen some of its successes. I think that it was you, Keith, who outlined the unlocking of capacity through the £19 million funding received from monitoring rounds. That has to be recognised. As well as that, Andrew McMurray talked about the natural drainage legislation, and I have been speaking to some stakeholders about that. There have been quite positive sounds made about what that legislation will potentially bring about. Let us therefore try those things and test them out rather than automatically default to adding more charges to households. I recently asked my officials to reassess a range of governance models, with reference to three specific tests, to which Members have alluded, to determine whether those models can secure large-scale investment, access and service debt and provide assurance about controlling the cost burden on the public. Ultimately, the funding and governance model for NI Water, as a non-departmental public body, must operate within the Executive's policy framework for the funding and delivery of water and sewerage services.

As I have said previously, it must comply with the requirements of 'Managing Public Money NI' (MPMNI) and, specifically, regularity, propriety and value for money.

I fully recognise the risks and issues affecting the environment, the economy and housing as a consequence of the funding challenges. I am committed to doing everything possible to ensure that my Department contributes to achieving the Programme for Government outcomes, which infrastructure — particularly, our waste water infrastructure — underpins across the board. We have talked about how we have seen some of the work that has progressed to date with the £19·5 million. As well as that, it is important to say that my Department is working collaboratively with colleagues in the Department for Communities, the Northern Ireland Environment Agency, the Housing Executive and NI Water to identify further key projects that can unlock waste water capacity to enable more housing connection in the future. We are also working collaboratively with other Departments in relation to Lough Neagh. We had a lot of talk today about reviews: "We do not want a review, but we do want a review". The Committee has asked for the six reviews that have already taken place. The Department has extensively reviewed the funding model and has analysed the opportunities for NI Water to raise additional revenue, to operate more efficiently, for additional borrowing, using additional public expenditure funding and governance change. My recent announcement about the appointment of a forensic accountant ties in with all that work. It is important that I, as Minister, the Department and the Assembly as a whole understand how that budget is currently being spent. Is there room for improvement, or, essentially, is there no more room for flexibility? I remain open to alternative solutions; however, they must be compliant with Executive policy on how water and waste water services are funded and comply with the requirement to increase investment, to control borrowing debt and to remain affordable, most importantly, for people and for families.

I do not have time at this point; sorry. As we have seen in the first three years of the price control, the current funding model works when it is funded. I doubt that there is a single Member in the Assembly who would suggest that we ask households and families to pay more in respect of water charges. The approach that I have taken is a sensible one that can achieve solutions. I welcome additional suggestions other than the implementation of water charges. If Members feel that there is scope out there that I have not looked at, feel free to share that. I have a meeting today with representatives from the NI Chamber and other sectors, and planning and waste water infrastructure will be part of those discussions. I am working with all key stakeholders across the North to ensure that we can find solutions that will not have a negative impact on the people whom we all serve.

2,045 words. Text as published by the Northern Ireland Assembly.

Assessment

Not flagged

Jev’s structured answers

Assessed 21 October 2026 at 12:31 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

Disagree with this assessment?

Classifications can be challenged. A person reads every challenge, and any change is recorded publicly above with its reason.

Challenge this classification