1. 1 Water Services Training Group 16 th Annual Conference Water Sector Reform Programme Implementation INEC, Killarney, 8 th November 2012

2. Water Sector Reform Programme Implementation Water Sector Reform – Implementation Strategy Maria Graham Principal Officer, Water Sector Reform Programme Management Section, DECLG

3. Water Sector Reforms The establishment of a new public water utility to take over responsibility for the delivery of water services. The introduction of a sustainable funding model to support increased investment in the sector to underpin job creation and statutory compliance. The introduction of independent economic regulation of the water sector under the Commission for Energy Regulation. 3

4. Overall Governance

5. Irish Water  Irish Water will be the water services authority and single point of contact for customers. It will have responsibility for: The abstraction, treatment and distribution of drinking water; Conserving water supplies through maintaining and upgrading the infrastructure; The collection and treatment of waste water and the management and operation of combined sewer overflows; Sludge disposal; Customer billing and relationship management, including requests for new connections; Strategic planning for the sector, water resource management and localised catchment management focused on source protection; The roll-out of the water metering programme; Sourcing private finance for investment in capital projects

6. Phased Transition Local AuthoritiesIrish Water Current PhaseWater Services AuthoritiesPlanning new utility. Interim Phase (interim legislation in 2012) Water Service AuthoritiesSome functions (domestic metering) Transition phase (2014-2017) Agents of Irish Water for delivery of services Water Service Authority Service level agreements with local authorities Steady State (post 2017) May remain as agents of Irish Water Ongoing relationship re strategic planning, wider water management, emergency planning Water Services Authority, responsible for capital investment & operations 6

7. Programme Management Structure LA Transition Office Bord Gáis PMO Irish Water Consultative Group Industry Forum 7

8. Purpose of Work-streams  Each work-stream outlines the key objectives, milestones, deliverable and tasks required to deliver on that area of work.  The various work-streams are inter-related and inter-dependent and the overall programme management governance is designed to ensure that dependencies and risks are managed and targets met.  Collaborative approach to progressing work – involving Department, LA Transition Office and local authority experts, Bord Gáis (Irish Water), NewERA and CER.  The work-stream working group will allow for sharing of information, monitoring of activities and issue resolution. Stakeholders will retain responsibility for decision making in light of their functions. 8

9. Policy and Legal Cluster The focus of this cluster is on ensuring that appropriate policy and legal frameworks are put in place for the Irish Water Sector 9 Legal & Legislation Policy Framework & Sector Governance Group Water Sector & Private Water Services Environmental Regulation Policy & Legal Cluster

10. Policy Framework – key milestones & deliverables  Overall policy: It is intended to publish a detailed policy statement in advance of legislation setting out the policy principles governing the sector for the period ahead.  Group water sector: the work-stream will reflect the best arrangements for managing this sector (in terms of funding, environmental regulation of the group water sector and quality assurance) in light of the specific needs both during the transition period and the longer term.  Environmental regulation: focus on ensuring that all aspects of current environmental regulation are provided for in the transfer of responsibility and that no diminution of environmental regulation occurs by way of oversight or omission. 10

11. Legislation (Q4 2012)  Legislation will cover: Establishment of Interim Irish Water – roll-out of the metering programme  Contracting authority;  Employing authority;  Supports communications and development of customer interface; Establishment of water sector regulation role under Commission for Energy Regulation 11

12. Legislation (Q3 2013)  Legislation will cover: Governance of Irish Water Re-iteration of the public ownership of water assets Transfer of water service authority functions Provide for agency arrangements (Service Level Agreements) which will not be time-bound Changes to planning law etc., to support consultation/dialogue between Local Authorities and Irish Water Necessary provisions in relation Irish Water staff. 12

13. Organisational Model Cluster The focus of this cluster is on ensuring appropriate mechanisms are put in place to establish the new organisation and the manage the transition. 13 Operations Corporate Development of Irish Water People, Skills & Change Management Capital Programme Organisational Model Cluster

14. People, Skills and Change Management Work- Stream  Key milestones relate to Consultation and engagement with staff and unions Developing the organisational model from a staffing perspective Developing framework for HR issues arising  During transition (SLA phase)  If SLA ceases  Irish Water Consultative Group: joint management /union group to provide a mechanism for regular structured dialogue, consultation and engagement on issues arising from the implementation strategy for Irish Water. 14

15. Operations and Capital Work-Streams  Operations key milestones include : Fact-finding - collating data to underpin Service Level Agreements, etc. Developing Operational Model Develop Service Level Agreement (templates) and concluding agreements  Capital programme key milestones include: Developing a transition plan for the management of the capital programme Developing investment plans for  2013 (current arrangements)  2014-2015 (first regulatory cycle) 15

16. Sustainable Funding Model Cluster The focus of this cluster is on ensuring that appropriate mechanisms are put in place to fund the Irish Water Sector into the future. 16 Customer Service & Billing Economic Regulation Finance and FundingMetering Sustainable Funding Model Cluster

17. Finance and Funding Work-Stream  Irish Water – funding issues Fact finding to establish cost- base Level of on-going Exchequer subvention Affordability measures and free allowance Developing strategies for third party funding  LA funding issues Approach to asset transfer, liabilities, and contractual obligations Impact on local authority balance sheet, position on development levies and General Government Balance considerations

18. Charging for Water  Strategy based on having systems in place to be ready to bill domestic customers from 2014 Economic Regulation – regulator will set charges, based on submission from Irish Water. Installation of domestic meters to begin in 2013; Billing system and customer care systems; 18

19. Conclusion  Extensive programme of work to establish Irish Water  Collaborative approach vital to success  Need to maintain delivery and continuity of service – phased approach  Significant ramping up of activity over coming weeks  Implementation will be underpinned with extensive communications with staff, stakeholders and the public. 19