There is no possibility under European law for the State to suspend or scrap water charges, legal advisers have told Irish Water.

Amid a deep political schism over the charges,. a legal opinion commissioned by the utility company says the State is required under EU law to keep the contentious regime in place

The advice – from senior counsel Garrett Simons and Michael M Collins – argues that there is no option under European law to return to the practice of not charging for water.

The introduction of water charges by the last government means the State can no longer avail of a “very limited” exemption in the EU water directive, they say.

“The benefit of the derogation has been lost for all time, and cannot be revived by seeking to reverse the decision to introduce charges,” the legal opinion states.

New divisions over water are emerging as a potential barrier to the formation of the next government after indications that Fianna Fáil will demand the suspension of charges to support a minority Fine Gael administration.

Default position

The legal advice – seen by The Irish Times – was commissioned by Irish Water parent company Ervia and delivered after the recent general election.

It says the default position in the EU directive is that member states must recover the costs of water services.

Water-pricing policies are intended to contribute to environmental objectives, they add.

“A very limited derogation to this default position is allowed . . . if it is established practice not to recover the costs of water services and where this does not compromise the purposes and the achievement of the objectives of the [directive]\.”

The opinion says the State cannot avail of the derogation “in circumstances where an intention to cease the previous practice of not imposing a charge for the provision of water services had been signalled” and was ultimately brought to an end by legislation in 2013.

Directive’s full rigour

It was clear that the exemption “was only intended” to allow a member state to continue an established practice of not charging. The “full rigour” of the directive applies once the member state decides to accept the principle of cost recovery by water charges, as Ireland did.

“Moreover, the Irish State has never sought to invoke the derogation.”

The barristers add that the State has never purported to advance reasons which would justify it not fully applying the EU water framework directive. They go on to say three criteria must be met to avail of the derogation, which is in article 9(4) of the directive.

“First, a ‘decision’ must be made in accordance with ‘established principles’ not to apply the recovery of costs provisions.

“Secondly, the purposes and the achievement of the objectives of the directives must not be compromised. Thirdly, the reasons for not applying the recovery of costs provisions must be reported in the river basin management plans.

“None of these are fulfilled in the case of the Irish State,” the barristers state.

“In our opinion, the Irish State is obliged to continue to impose charges for domestic water services.”