Merger is not a smash and grab raid on fund

Tynwald buildings, Douglas

Tynwald buildings, Douglas

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This is not a ‘smash and grab raid’ on the Water Authority’s sinking fund.

In Tynwald, Treasury Minister Eddie Teare defended plans to merge the Manx Electricity Authority with the Water and Sewerage Authority.

He said that following analysis, the Council of Ministers had concluded that the merge may bring about savings and synergies that debt repayments can be funded without recourse to further Treasury funding.

‘It is expected that the combined revenues of a Manx Utilities Authority will meet the full operational activities and debt obligations,’ he said.

But Peter Karran (Lib Van, Onchan) suggested that this was ‘cash grab’ on the sinking fund set up by the Water Authority in 2005.

The repayment fund, into which surplus income over expenditure is invested, was set up with the aim of ensuring the £75 million bond issued in 2000 to fund infrastructure renewal works, is repaid in full by March 2030.

Mr Teare said he appreciated Mr Karran’s concerns but insisted: ‘It’s not a raid on the sinking fund. This is not a smash and grab.

‘We are taking a long-term strategic view. We’ve been accused of short-termism in the past.’

The proposed merger of the WASA and the MEA was announced last week as part of the government’s restructuring plan.

Mr Teare said that before the debate on the proposed merger, which is scheduled for next month’s Tynwald sitting, he would be happy to share the financial projections with members.

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