Funding wastewater infrastructure

With the proposed introduction of water charges being ruled out by the Minister for Infrastructure, the Department has published a consultation mooting the prospect of developer contributions in order to fund wastewater infrastructure development.

Northern Ireland’s wastewater infrastructure deficit is now a measurable and significant driver of housing undersupply, and Belfast is one of the worst affected areas.

While it is challenging to calculate how many houses have not been built due to the shortfall in wastewater infrastructure, NI Water told the Northern Ireland Assembly’s Infrastructure Committee in 2024 that around 19,000 homes across Northern Ireland are currently stalled or delayed because wastewater systems cannot accommodate new connections.

In 2025, Minister for Infrastructure Liz Kimmins MLA announced a total of around £500 million for the sector, including an immediate injection of £19.5 million to NI Water, aimed at unlocking capacity for 2,300 new homes. A 2021 report by the Northern Ireland Audit Office (NIAO) states that there will need to be investment of at least £2 billion over the next decade to bring wastewater infrastructure “up to a sustainable standard”.

Minister Kimmins subsequently introduced the Water, Sustainable Drainage and Flood Management Bill in June 2025. The Bill proposes reducing pressure on Northern Ireland’s sewerage system by preventing excess rainwater from entering wastewater pipes, improving regulation of drainage connections, and giving NI Water stronger powers to address unlawful or misconnected drains.

The Bill also promotes sustainable drainage systems so stormwater is absorbed or slowed before it reaches combined sewers, which makes it easier for NI Water to adopt and manage certain private sewer infrastructure, and helps reduce sewer overloads that can lead to flooding and sewage pollution in rivers and coastal waters.

However, the Bill does not create new sewage treatment plants, directly expand wastewater treatment capacity, impose new environmental discharge limits on sewage outfalls, or ban storm overflow discharges. The Bill also does not provide any significant capital funding for upgrading ageing wastewater infrastructure, nor does it solve the wider capacity shortages that are delaying some new housing developments where treatment works are already full.

In this context, there remains a significant shortfall in funding. The Northern Ireland Fiscal Council said in its 2025 water sustainability report that “the current funding model is not fit for purpose,” and warned that “charging for water or increasing taxes” are among the politically difficult options now being openly considered to secure long-term investment in NI Water.

Likewise, the independent 2025 review of NI Water’s funding model concluded that the absence of domestic water charges remains a central structural weakness, noting that its financial constraints stem directly from the longstanding decision not to introduce household charging and that this leaves the utility heavily dependent on an annual public subsidy rather than a stable independent revenue stream.

It is likely there would be significant public opposition to the introduction of water charges. In 2014 in the Republic, Enda Kenny’s government introduced domestic water charges as part of austerity-era reforms, meaning households would begin paying for water usage for the first time.

The move was implemented through Irish Water (now Uisce Éireann), a national utility set up to meter and bill households, but it triggered widespread public opposition. Large-scale protests took place across the country, with hundreds of thousands of people demonstrating and many refusing to pay, arguing that water was a basic public right and opposing what they saw as unfair double taxation after existing local taxes were already in place.

In response to the political pressure, the Government made several major concessions: it capped charges for households, introduced subsidies and allowances (including a free usage allowance), paused enforcement actions for non-payment, and eventually abolished water charges for domestic users in 2016, effectively moving back to a centrally funded model through general taxation rather than direct billing.

Consultation report

In a consultation report on the introduction of developer levies as a form of revenue raising, released in March 2026, it became clear that there was no broad consensus in favour of making developers pay for wastewater upgrades in Northern Ireland, despite widespread agreement that the infrastructure crisis itself must be addressed urgently.

Across the 293 consultation responses, a clear majority opposed the principle of introducing developer contributions. 61 per cent of all respondents disagreed with creating a developer contribution pathway, while only 32 per cent supported it. Opposition was especially strong among organisations, particularly within the development and housebuilding sectors, which accounted for the largest share of submissions. These respondents consistently argued that developer contributions would increase construction costs, reduce viability, and ultimately raise house prices and rents.

Despite this opposition, there is a strong consensus that Northern Ireland’s wastewater infrastructure is inadequate and is already constraining housing delivery, economic development, and planning approvals. Respondents broadly accept that investment is urgently needed.

A dominant theme throughout the consultation is the view that wastewater infrastructure should not be funded primarily through charges on new developments. Many respondents argued that this approach unfairly places the burden on new homebuyers and renters, effectively creating what several described as a “tax on new homes”. There is also widespread concern that imposing levies on developers could discourage construction, particularly in lower-margin rural areas, regeneration schemes, and affordable or social housing projects.

Another strong area of consensus is that the consultation’s proposed funding models were seen as insufficient or incomplete. When asked which pathway they preferred between voluntary contributions, a compulsory levy, or both, the largest single group of respondents selected “other”, indicating dissatisfaction with all of the options presented.

Respondents repeatedly called for alternative solutions instead of developer levies. These included increased Executive funding, greater borrowing powers for NI Water, household water charges, revised rates mechanisms, and broader infrastructure financing reform. Many argued that the problem requires a system-wide funding strategy rather than a targeted charge on one sector.

Writing in agendaNi in April 2026, Minister Kimmins again ruled out the introduction of water charges, saying: “I have repeatedly said I will not introduce water charges on hard pressed families but continue to develop the three-pronged approach that is already in place – securing more funding from the Executive, introducing the Water, Flooding and Sustainable Drainage Bill, and launching voluntary developer contributions – which underlines my commitment to delivering innovative solutions in partnership with NI Water, Executive colleagues, and the development sector.”