To ask the Minister for Infrastructure, further to the Northern Ireland Audit Office report stating that there should be a comprehensive review of how NI Water is funded, to outline the basis on which he considers NI Water’s funding model to be fit for purpose.

Mr O'Dowd

I confirm that I have the answer to question 6. First, I want to clarify that the Audit Office report does not state that there should be a comprehensive review of how NI Water is funded. It is important to note that, in its report on the funding of water infrastructure, the NIAO simply encouraged my Department and NI Water to complete a review of the alternative funding and governance arrangements for NI Water to be led by suitably qualified experts.

As I have previously set out, my Department has already extensively reviewed NI Water's funding model and engaged experts in the Strategic Investment Board (SIB), the Department of Finance and NI Water and the Utility Regulator, who analysed the opportunities for NI Water to raise additional revenue and looked at different governance models. The conclusion was that all of the models examined required a water-charging model. To be clear again, I will not introduce domestic water charges on people and families who are already struggling as a consequence of rising inflation and higher costs of living. My Department also reviewed alternative water utility company structures, including mutualisation, across these islands for best practice. I know that the Member will be interested in that, given that the Alliance Party has recently published its policy proposals for the funding and form of NI Water and has proposed mutualisation as one such structure. As I have previously advised the Assembly, mutualising NI Water will require the introduction of domestic water charges. However, in the spirit of delivering solutions, I have asked officials to keep alert to additional opportunities for providing additional funding for water and sewerage services within my policy framework and in collaboration with NI Water. Alongside that, I am working hard in partnership with the Executive on progressing a three-pronged approach to ensure that NI Water remains fit for purpose. Specifically, I am continuing to work with Executive colleagues to try to increase waste water investment; reviewing the policy and legislation around developer contributions; and securing Executive agreement for the water, flooding and sustainable drainage Bill to be introduced to the Assembly. I will leave it there.

Mr Speaker

Thank you, Minister. I think that you are better at answering the questions yourself than using the civil servants' answers, because you finish on time. Nonetheless, I am sure that you will get the rest of it in during your response to Ms Nicholl's supplementary question.

Mr O'Dowd

I do not agree with the use of the language. There is no certainty for NI Water going out onto the markets either. That has to be said. It has one certainty when it is being funded directly by the Executive: it has, at its back, the Executive — the Government. Going to any institution beyond that brings uncertainty. The markets will gladly, I suspect, take on NI Water, and privatisation will gladly take on NI Water, but look at what is happening in England. Look at the water companies in England that have been privatised. They are in substantial debt but continue to pay out significant bonuses to their directors, executives and shareholders. They are damaging the environment, because the scale of the upgrades that were promised to the infrastructure simply has not been delivered. Therefore, privatisation is not the utopia that some people present it as. As I have said, mutualisation will lead to domestic water charges: I am not going down that route. Others may support it, and that is fair enough. NI Water has the Executive behind it. We have made significant investment in NI Water — over half a billion pounds this year. I also secured £19 million during the October monitoring round from my Executive colleagues, and we connected an extra 2,300 homes as a result of that investment. Often, when we talk about NI Water, we, understandably, talk in billions and hundreds of millions, but, sometimes, £5 million, £10 million, £15 million or £20 million makes a big difference.

Mr Dunne

Some 17,000 new homes across 23 of our towns are still being held up due to the waste water restrictions, so the system is clearly not working. What more can be done, particularly in relation to future monitoring rounds, to ensure that we can get back to homebuilding? Does the Minister agree that a sticking plaster approach simply will not cut it?

Mr O'Dowd

Even if the Executive were in a position to fully fund NI Water during the current price control period, 2021-27, it would connect only a further 4,500 homes. When it comes to those 19,000 homes or whatever figure is thrown out — I think you referred to 17,000 or 18,000 homes — the reality and the facts are that, if NI Water were to be fully funded to the level that the Utility Regulator recommended, 4,500 additional homes would be connected. NI Water is on record as saying that, during that period, if there were contributions from developers to divert rainwater away from the system, it could connect another 18,000 homes. Yes, NI Water faces challenges in delivering, but, as I have said many times in the Chamber, let us not send out the message that we are closed for business, because we are not. Developers continue to engage with NI Water, and connections continue with NI Water. As I said when I answered the supplementary, the Executive delivered an additional £19 million to NI Water in October, and 2,300 homes will be connected as a result of that investment. We can all become blinded by figures and the scale of the problem that is coming at us, but that has shown me that we can solve some of those problems with some investment. The long- and medium-term plans that I have in front of me will allow NI Water to continue to deliver on its objectives.

Mr O'Toole

Minister, are you seriously telling us that you think that the funding model is grand? You seem to be saying that it is about finding odds and sods in January monitoring rounds, with tens of millions here and there. Important though that is, that is no model for the long-term funding of our waste water infrastructure. Every serious economic commentator, construction company and outside investor says that our water infrastructure is a crisis that needs to be dealt with. Down the coast, where NI Water pumps millions of tons into Belfast lough, we are famous for our seabirds, but lots of people listening today will associate that kind of intervention with another type of bird: an ostrich sticking its head in the sand. Minister, we need action on NI Water.

Mr O'Dowd

There is a difference between a funding model and the amount of funding received. Is the Member telling me that the privatisation of NI Water is now the Opposition's policy?

Mr O'Toole

I did not say that. What is your policy?

Mr O'Dowd

My policy is clear.

Mr O'Toole

No, it is not.

Mr O'Dowd

Maybe you have not been listening. Under my policy, NI Water will stay under the governance of the Executive. It will not be privatised. It will continue to receive a public subvention, which was almost half a billion pounds this year. I will continue to work with my colleagues. I am doing so successfully, because they are also willing to travel the journey to secure additional funding for NI Water. I am looking at contributions from developers for NI Water. We will then move to one of the most fundamental changes that, I believe, has to happen: working with nature. The sustainable drainage system (SuDS) Bill that will be introduced to the Assembly for Members to debate will set out a governance arrangement for dealing with the millions of gallons of rainwater that we put through waste water treatment works but do not need to treat. We spend tens of millions of pounds treating water that we do not to treat. We should hold that water back and release it more slowly into the system by working with nature. I have a plan; I look forward to hearing the Member's plan.

Ms Sheerin

Minister, will you outline the reviews of NI Water's funding model that the Department has carried out?

Mr O'Dowd

Several reviews have been carried out over the years. All of them have come to the same conclusions. Anyone standing in my shoes could change the funding model for NI Water. They could bring in privatisation or mutualisation etc. However, all the reviews came to the conclusion that changing the model would require the introduction of domestic water charges. I am clear on this, as are many others in the Chamber: there will be no introduction of domestic water charges. That limits the options. However, as I said to the Member who asked the original question, look at what is happening in England. Those who tell us that privatisation would solve all the problems in the management of waste water infrastructure should look at England. There has been significant damage to the environment, and companies are in serious debt, on the brink of collapse, and may even have to be nationalised again. Billions and billions of pounds of families' and workers' money went into those companies, but those people never saw the benefit of it.

Mr Allen

Just last week, the Communities Committee received a briefing from NI Water on the challenges that it faces. The officials from NI Water said that the capital investment required is nearly double that which is forecast. The Minister has repeatedly highlighted and then ruled out mutualisation, for example. Will he point us to the recent information that he has used to assess how mutualisation will lead to water charges?

Mr O'Dowd

One of the first debates that I responded to in the Chamber was on a motion that referred to the introduction of mutualisation. At that stage, I set it out clearly that information was available to me that mutualisation would lead to domestic water charges. That was in March or April 2024. To date, no one has provided contradictory information to that. If anyone can come forward with a report, research or information that is different from that, I will happily examine it, as will my officials. There is no magic or easy solution to this. NI Water faces huge challenges, but name me a public service that does not. My job is to find solutions. I have set out in front of you today three of the pathways that I am following. One of those has already borne fruit: a £19 million investment has delivered over 2,300 connections. I will continue to lobby for more money for NI Water, and my Executive colleagues are on the same page as me. We will continue to look at the other methods as well.