THE IRISH GOVERNMENT has €300 million invested in Irish Water, or 21% of the money committed by the Irish Strategic Investment Fund (ISIF) to date.

The ISIF was established in December last year to earn a return for the State on commercial investments and is in the process of absorbing the assets of the former National Pensions Reserve Fund (NPRF).

Those assets were valued at €6.9 billion as at end March 2014.

Given the ISIF’s remit, the obvious conclusion is that Irish Water as a profit-making proposition is seen as a particularly viable one.

Source: kildarestreet.com

Speaking to TheJournal.ie a Department of Finance spokesperson said that all such investments ‘are made on a commercial basis, but you would have to contact the investors themselves [in this case the National Treasury Management Agency (NTMA)]‘.

It’s not like a grant system, the idea is to give some sort of commercial return. From that point of view a case can be made for any individual investment.

TheJournal.ie contacted the NTMA and were told by a spokesperson for the ISIF that the investment in Irish Water was a ‘bridging facility’ which was only approved following the provision of a guarantee by the Government.

In making this bridging facility available, the Fund recognised that as Irish Water had not been formally established, there was no clear view of revenue streams.

Therefore the Fund indicated that to provide Irish Water with a bridging facility, a government guarantee would be required.

Fianna Fáil finance spokesman Michael McGrath, who asked the Dáil question of Michael Noonan that led to the provision of the above figures last week, earlier spoke disparagingly of the ISIF investment in Irish Water.

Michael McGrath Source: samboal

“The fact that the Strategic Investment Fund is being used to prop up Irish Water financially is further evidence of the drain which Irish Water has become on the resources of the State,” McGrath told the Examiner.

It is diverting money away from potentially far more productive uses.

McGrath further claimed that the ISIF’s ‘painfully slow’ progress has thus far shown little evidence of any investment which would make a discernible difference in terms of jobs and growth.

The ISIF’s statutory mandate is to ‘invest on a commercial basis to support economic activity and employment in Ireland’ according to its website.

While the need for the State to provide for social welfare and public service pensions obligations had not abated, fostering economic activity and employment is currently a greater priority and this will in turn put the State in a better position to meet its pensions obligations in the longer term.

Just €1.4 billion, or 20% of the investment fund has currently been committed, while a mere €186 million (3% of the entire fund) has been invested in the last nine months.

Of that €186 million fully €50 million (27%) went to the controversial water utility.

According to the ISIF however the slow rate of investment seen will pick up as the fund ‘sells its investments outside Ireland to fund new Irish investment commitments consistent with its mandate’.