Executive will increase rates to cover water charges claims Alliance

11.55.00am BST (GMT +0100) Fri 12th Oct 2007

Alliance Finance spokesperson Stephen Farry MLA

Alliance Party Finance Spokesperson Stephen Farry MLA has claimed that the people of Northern Ireland are prone to a massive hike in the regional rate to compensate for water charges being shifted onto rates.

Dr Stephen Farry stated:

"Before the Executive parties congratulate themselves too much over moving water charges back into the regional rate, they must inform the people of Northern Ireland of the level of rates hike that they can now expect.

"The budgetary framework inherited by the current administration was based on the assumption of water charges being raised locally. The Barnett Formula which determines the Northern Ireland Bloc Grant makes no provision for funding water.

"The paltry £100m peace package secured from Treasury was used to defer water charges for one year - not to address the fundamental structural problems within our economy. Inherited budgetary assumptions were based on water charges raising a figure up to almost £300m after a three-year transitionary period.

"Current efficiency savings being found by the individual Departments will be barely sufficient to meet the new and changing demands for improving local public services. No action is being taken by the Executive to address the costs of division, and to open new opportunities to avoid a growing local tax burden. Therefore, only a cut in services can avoid a hike in rates. The regional rate is the only means the Executive has to balance the books.

"It would be totally wrong to give people the impression that water charges are already present within rates bills, and then raise the regional rate by a significant amount to cover the costs of water.

"There has been too much fancy footwork from the Brown Government in its dealings with Northern Ireland. We do not want to see that repeated by the Executive."

ENDS