Official Report: Minutes of Evidence

The Chairperson (Mr Martin): Good morning, gentlemen. You are all very welcome. We are joined by Sam, David, Mark, another David and another Mark. That could prove interesting. Sam, you are the outlier today, given that there are two Davids and two Marks. In my daughter's school, the Davids would be called David F and David M. That is the way in which it is done in post-primary schools, but we will see whether we can get through the session without calling you that. Mark, you are in the middle, so we are in your hands. I invite you to give evidence for up to 10 minutes, after which, as you know, the Committee will ask a few questions.

Mr Mark Spence (Construction Employers Federation): Thank you, Chair and members, for inviting us along this morning. I will try to keep my opening statement to more like two or three minutes. Thank you for the opportunity to give evidence on the Water, Sustainable Drainage and Flood Management Bill. I am the chief executive of the Construction Employers Federation (CEF). I am joined by David Magee from Antrim Construction Company (ACC), Sam McKee from Turley Associates, Mark Hardy from Marrac Design and David Fry from the CEF. You will be familiar with the team from your visit in December 2025 to Antrim Construction's Belmont Hall development in Antrim.

We support the Bill and look forward to its enactment before the end of the Assembly mandate. On the specific subject of sustainable drainage systems (SuDS), it is our strong view that, done correctly, SuDS can provide much better amenity for homeowners and home occupiers. Reflecting on the separate Department for Infrastructure consultation on SuDS guidance, we note that the Bill's intent is to give DFI the power to mandate soft SuDS. The importance of the consultation on the SuDS guidance, and other consultations that will follow, must therefore be a major focus for the Committee beyond the end of its Bill scrutiny, as that is where the more fundamental issues will be considered.

From our engagement with DFI officials, we believe that the areas of most significance can be narrowed down to the following. First, what should be the SuDS approval body? Notwithstanding the good intentions of the storm water management group, the timescales of its processes for the existing soft SuDS pilots were too long. We have suggested that an appropriately funded and resourced DFI Rivers may be a suitable place for that to reside going forward.

The second consideration is the importance of design guidance for developers and how that will be embraced by all planning authorities. Although they are open to pilots in different council areas, housebuilders cannot be in a scenario in which each planning authority takes a completely different approach to soft SuDS. DFI's powers on the enforceability of any guidance must be clear. An essential element of that is how planning authorities will treat designated SuDS areas during the construction of any development. In our view, those areas could be appropriately used as a silt management pit in order to comply with any agreed construction management plan.

Thirdly, there is a need for clarity on policy implementation timelines. Many homebuilders will be looking to buy land now for development in three-plus years' time. The proposed timescales for soft SuDS implementation that are contained in the current guidance consultation are suggestive of a crossover, and homebuilders need clarity now on whether those timescales will be met.

Fourthly, it is crucial that SuDS count as open space. Our estimate is that, on any major site, such as the one that you visited at Belmont Hall in Antrim, approximately two acres of land will need to be set aside for features such as ponds. With 10% of development land normally set aside for open space on major developments, it is therefore vital that such features be included as open space so that we do not unduly curtail housing development, with that needing to be mandated across all planning authorities consistently.

Fifthly, on application and maintenance costs, the viability of sites is linked to their purchase. Work must be expedited on what DFI believes those costs will look like and on whether its preference for a Welsh-type model is likely to proceed. It is vital that policies on maintenance and adoption be clear and robust at the outset and not be subject to undue interpretation.

Sixthly, there is a need for clarity on the extent of soft SuDS on sites. We are given to understand by DFI that, owing to the proposed schedule of uplifts in building regulations, the Department of Finance has requested that property-level SuDS not be advanced at this stage. We ask that that matter be fully clarified as the detailed policy development on SuDS guidance is advanced.

The final consideration is the importance of retrofitting. Reflecting on the Minister for Infrastructure's three-pronged approach, we again reinforce the point that mandatory soft SuDS on new housing developments will do little to resolve our housing crisis as it relates to waste water capacity. What does offer more potential, however, is the retrofitting of existing assets, which we understand is a proposed part of the price control 28 (PC28) plan from Northern Ireland Water (NIW), as well as being included in an initial £15 million allocation from the public-sector transformation fund. We look forward to such retrofitting proposals being significantly advanced as we move towards the commencement of PC28.

I will return briefly to the wider context in which the proposals sit, namely the Infrastructure Minister's three-pronged approach. In light of the discussions during the Committee's meeting last week, we retain our clear view that addressing our waste water infrastructure deficit requires a step change in approach by DFI and the wider Northern Ireland Executive.

On developer contributions, we are supportive of the proposals on enabling voluntary contributions whereby developers could make the commercial choice to seek to upgrade an existing Northern Ireland Water asset in order to enable development. We are, however, equally clear that the overall impact of that would be extremely limited.

On the funding of Northern Ireland Water, we, along with our colleagues in the Northern Ireland Chamber of Commerce and Industry (NICCI) and the Northern Ireland Federation of Housing Associations (NIFHA), published a report last June that was based on research that Grant Thornton and the Turley economics team had conducted. The report was on how an infrastructure levy could deal with Northern Ireland Water's funding gap and create a long-term, sustainable, multi-year investment model to take forward stalled housing and industrial and regeneration projects, as well as to deal with increasing environmental challenges. As members will be aware, this week, we updated the figures from last year's report to take account of NI Water's anticipated submission to the Utility Regulator ahead of PC28, the figures produced in the draft Budget and the Department for Infrastructure's baseline allocation to NI Water of £321 million per annum. Against that, we have identified a £1·29 billion funding gap in PC28, which would equate to an average infrastructure levy of £1·25 per household a week, amounting to an average of £65 a year. Taking forward such a levy would enable a borrowing repayment of £55·9 million a year.

Crucially, our proposals would not alter the existing governance status of NI Water, as it would retain at least £400 million per annum of public subvention, thus ensuring its public ownership. Our proposal, which is progressive in nature, protects the most vulnerable in our society, while also charting a sustainable path towards dealing with an issue that is now the principal inhibitor to economic growth and an accelerant of the environmental decline that we face. We are now happy to take questions on that issue and on any others raised in our evidence. Thank you.

The Chairperson (Mr Martin): Thank you very much for that, Mark. This is a crucial area. You will not have seen the first 15 minutes of the Committee meeting. As Chair, I raised the press release that went out from David earlier in the week — I think that some newspapers covered it yesterday — so you may get some questions on that, as well as on the Bill and on SuDS.

You referred to the Minister's three-pronged strategy, which, if I have got it right, comprises more funding, the Bill and developer contributions. We have written to the Department asking it this question, so we are interested to hear your view. Quantitatively, what impact on the wider situation that housing developments face will the Bill have? The SuDS Bill is one prong of the Minister's approach. What impact will the Bill have on the issues that we face, such as homes being prevented from being built and jobs being lost?

Mr Spence: I will start and then look to my technical colleagues. Of the three prongs, having SuDS is the right and progressive thing to do. SuDS provide good treatment for water drainage. We have to remember, however, that without funding for retrofitting, which we have mentioned — if we are going to apply SuDS only to new developments — the Bill, logically, can assist only new developments, and we know that the number of developments is in decline owing to the lack of capacity in the waste water system. I therefore have to say that, although it is the right thing to do in order to deal with the infrastructure crisis in NI Water, it will have a relatively immaterial impact. I do not know whether some of my technical colleagues wish to add anything.

The Chairperson (Mr Martin): Mark, as you look to your colleagues, members are scribbling down "relatively immaterial".

Mr Mark Hardy (Marrac Design): The SuDS Bill is a good thing, if that is what you are asking, Chair.

The Chairperson (Mr Martin): The Committee agrees.

Mr Hardy: Overall, it is good, but it needs to be more streamlined about where SuDS happen. Retrofitting will help only some areas. Having SuDS in new developments will assist with flooding in the area and protect the ecology: all the buzzwords for what needs to happen in those developments. There needs to be space to do that, however. There has to be the area available at the level that is needed for SuDS, because they do not work at every site. SuDS would certainly help with new developments, but they will not help address the waste water infrastructure issue. That is the clear distinction of which people need to be made aware. We have always used separate systems with new developments, so increased pressure has never been put on the waste water infrastructure. Retrofitting is needed to assist in areas where it would be fitting to have SuDS. The answer to your question is that, overall, the Bill is good.

The Chairperson (Mr Martin): Would retrofitting cost additional money?

Mr Hardy: Yes.

The Chairperson (Mr Martin): OK, so additional money would need to be found if we were to have the impact that we are looking for with waste water connections. If my thinking is correct, you are going into developments that do not have SuDS and connecting things up in order to lower the input into the storm drain. That is positive and will help address the issue of the amount of sewage and the problems that are being faced from spillage into rivers and so on. Am I correct in saying that that would cost additional money to do and that the Department would have to fund it?

Mr Hardy: Yes, that is correct.

Mr David Fry (Construction Employers Federation): In the fullness of time, NI Water will give evidence to the Committee. It has engaged with us on its proposals for retrofitting during PC28. That is costly work, because it effectively has to go into existing urban areas and find a solution to deal with storm water. Part of what NI Water is trying to deal with may be a flooding issue, but a lot of capital investment would be required before any significant return would be seen. Is it part of PC28, as we understand it? Yes, and we have already given the Committee some figures, such as the public-sector transformation fund allocation. When NI Water comes before the Committee, its representatives will probably be able to go through that in more detail. I think that it is considering quite a few schemes in and around Belfast.

The Chairperson (Mr Martin): As I said, I talked about this before the evidence session, during Chairperson's business. I will read from the press release that we have here and ask you to elucidate it and the issue's seriousness, because it is fairly serious. I read the Turley and Grant Thornton paper and can say that it is excellent. You have drawn from it in your press statement here, which states:

or stripped from it, I guess. Would you like to say any more about the context behind or the seriousness of what I have just read out?

Mr Spence: The report is fairly clear about the impact. We can talk about the challenges that we face or about the opportunities for the economy. As you know, the collective grouping involves the Northern Ireland chamber and the Northern Ireland Federation of Housing Associations, and, more recently, we have been working with Manufacturing NI and the Chartered Institute of Housing (CHI). Our collective concern is that we are constrained by the economy and that that is limiting our opportunity for growth.

Northern Ireland is a place where there is opportunity, and none of us wants to stymie that opportunity. What we are clearly seeing, however, is an opportunity missed if we do not address the infrastructure underlying all investment. There are anecdotal examples of inward investment to this place. That is a key driver of the Northern Ireland economy and something for which colleagues in the Department for the Economy are pushing hard. When external investors come here, however, they are surprised to find that some of the basics are not in place. That is the case not just with water but with energy.

Our concern is that we are limiting local development. There are 50,000 homeless people who are looking for homes. Private rents are unduly high because of the lack of supply. House prices are increasing, so people's mortgages are being stretched. The lack of infrastructure therefore has implications for the public, because it pushes up their living costs.

We are also limiting our opportunities for economic growth, for new jobs and for new developments, as well as for all the GVA that comes with that.

To be more positive, the paper that we presented in June and the figures that we have updated since Christmas on the back of the revised figures in the draft Budget show that the opportunity to fix the situation has become more affordable than it was even last year, and we believed that it was affordable then. Chair, that may be our direction of travel. There is an opportunity to be seized by the Executive to transform the local economy.

The Chairperson (Mr Martin): I have one final question, after which I will bring in the Deputy Chair, who is with us virtually. There was an opinion piece by Sam McBride over the Christmas period in which he did some work on that issue and wider ones. He focused on the Minister and highlighted the fact that, very often, in response to questions about funding, she will say that it is the British Government's fault that there is not more funding for this place. Leaving aside the rights or wrongs of her argument — I think that she used that phrase in response to 132 Assembly questions — is it correct that the funding gap that you have identified for the next price control period is £1·29 billion?

Mr Spence: Yes.

The Chairperson (Mr Martin): In your professional opinion, if the Northern Ireland Executive were to go to Treasury and said, "Look, we'd like £1·29 billion. We have bit of a problem with our waste water infrastructure", how likely is it that Treasury would say, "Yes, that's fine. Here's your £1·29 billion"? Is there something else that needs to be done to try to fix the problem, which I think that everyone agrees needs to be fixed?

Mr Fry: We can always ask the Treasury for more money. There have been arrangements over the past decade that have enabled one-off tranches of money to be set aside, such as £500 million for shared education and shared housing over 10 years, a lot of which has ended up funding the Strule Shared Education Campus. We have simply looked at the figures in the draft Budget. We see that the Northern Ireland Executive are aiming to spend about £2·5 billion on capital in each of the next four financial years. We have taken away from that the Executive's earmarked allocations. We think that, next year, DFI is due to be allocated about £960 million, which is a lot of money. Once, however, the earmarked allocations are removed, a significant allocation is made for road maintenance and the remaining NI Water gap next year is funded, we are left with about £200 million. To put that in context, Translink received £230 million this year. We have not even included in that DFI Rivers.

Additionally, there will be contractual commitments that DFI has to meet. We do not know the quantum, but they likely include Driver and Vehicle Agency (DVA) test centres, two of which are under construction. We have taken the figures, looked at NI Water's price control, taken into account the fact that DFI has said that £321 million is the baseline for each of the years and taken into account NI Water's proposed figures, and we have worked out that there is a gap of £1·29 billion over the PC28 period. The ideal solution is that the block grant will fund that, but our view is that it is not realistic at this juncture to think that that will happen. Our evidence base for saying that is that PC15 was underfunded by £800 million and that PC21 — the original PC21 plan, not the midterm review — will be underfunded by £800 million. That has effectively shifted all the living with water programme in Belfast and many other schemes into the next price control period, where they will be more expensive. If you begin PC28 without knowing the full long-term funding picture, you will not deliver the really big capital schemes, such as the Kinnegar capital scheme, which is probably now of the order of £200 million, because it will be completed only in 2033.

That is why we try to break down the figures as much as we can. That is not in any way to dismiss the efforts that the Infrastructure Minister and her predecessor have made, but if you look at the report that was published the other day about the Newry corridor — I think that £26 million of investment is going into it — you will see that, once Newry has exhausted capacity again, the Department is still faced with having to do a £120 million rebuild of the existing waste water facility.

The Chairperson (Mr Martin): That is great. I could ask another eight questions, but, if I were to do that, I would eventually have a rebellion on the Committee. I will hand over to John, the Deputy Chair, who is joining us virtually.

Mr Stewart: Gentlemen, apologies for not being with you in person today. Thank you for your honest and frank assessment of the Bill and of the impact that it will have on our waste water capacity. Thank you for the opportunity to meet in Antrim and for the visit to the SuDS site there. It was very informative. It was very useful to see it and get a hands-on experience of it.

In your submission and on that day, you talked about the need for clear, consistent and enforceable guidance on SuDS across all planning authorities. I know that you talked about that briefly in your initial presentation, but will you expand on how important that is and on your experiences and those of construction companies to date of how frustrating the process has been of dealing with the different policies that planning authorities across the country are pursuing?

Mr David Magee (Antrim Construction Company Ltd): I am happy to take that one. The process that Antrim Construction went through to see the finished product on the ground started in January 2018, and we concluded it in August 2024. It involved the storm water management group doing its assessment and risk management of the design, with all the boxes being ticked during the first couple of years. We then entered into a planning process, and it took another couple of years for the approval to come through. That was a very difficult and painful process, to be truthful, for a construction company. Our team and the consultants recognised the benefits, environmentally and visually, as the Committee saw when it visited the site. The problem that we had with the site was that had we not owned additional land around its perimeter, the probability was that we were not going to get approval. That was simply down to a planning view that the site could not be deemed open space. Now that we see the product on the ground, I would like to think that any policies that come forward will accept that basins of that type that are well presented can contribute to the requirement for open space in new developments.

Mr Sam McKee (Turley Associates): I will add to that.

Mr Stewart: Please do.

Mr McKee: The Department's consultation document rightly outlines the need for clear guidance, certainly in the areas of design standards, approval processes and maintenance arrangements. There is currently a gap there. I think that six planning strategies have now been adopted across council areas, with more to come. All endorse the use of soft SuDS. We welcome that, as we have said already. In addition, however, we need clear guidance so that everybody knows what the design standard is, everybody knows what the approval body is and, ultimately, everybody knows what the maintenance arrangements will be so that that can all be understood and costed in advance of having a new development. The need for that policy is critical.

Mr Stewart: Thanks for that, Sam. Antrim Construction's experiences stress how poor the process has been to date. I get that the experience was that the planners and the storm water management group were quite hesitant to act. There was potentially a fear of the unknown for them, but I am not entirely sure. Perhaps you can shed some light on that. A consistent approach is undoubtedly required here, however. Are there any areas across these islands or elsewhere to which you can point that the Department would be advised to look at as a model of best practice of how things work well that we might be able to follow here, by copying the best of it and learning from the worst of it?

Mr Hardy: I can answer that one, John. We have been involved in quite a few SuDS basins in different areas. We tapped into the Welsh model, particularly Cardiff City Council's scenarios on adoption and the parameters that it sets. The SuDS approval body is part of the consultation and planning process in Wales. The only slight difference between Wales and here is that the councils there adopt and maintain the asset themselves. The developer and the management group need to do that here and, obviously, the residents contribute to that. It is certainly something that we will advise the approval body here to look at and consider as a baseline for assisting Northern Ireland's future SuDS policy.

Mr Stewart: OK. That is really useful to know. Should the legislation be amended to reflect that so that there is clarity from the beginning, rather than leaving it open to interpretation or guidance down the line?

Mr Hardy: As we have all said, today and on previous occasions, the most important thing is getting clear direction from the approval body about the design, maintenance and adoption of the SuDS. That direction should be accepted by all the councils. There is still discussion about how that body should be integrated into government. Our advice is that it needs to be under a DFI umbrella in some shape or form, although it may not be a new section within DFI. DFI already looks after the roads and has basins attached to some of them — there are basins under the new bypasses — so it might be an easier jump for it to look after that, but, again, it will have to be discussed and bottomed out. Definitely, DFI seems to be the appropriate —.

Mr Stewart: Yes, I agree. I have a couple more points —.

Mr Magee: Sorry to cut across you, John. Mark may have mentioned this to you, but it is worth highlighting that, from a viability point of view, it is very important that, in the acquisition of land, developers know clearly what they are dealing with. If it will be a case of dealing with soft SuDS in the form of the basins that you have seen, that is one thing, but if that does not become a fit for the land in question, you could be into tanks and oversized pipework and things like that, which becomes more expensive again. However, it is vital that we have clarity on the associated rules and regulations before making a purchase. We need to know what we are dealing with.

Mr Stewart: Thanks for that. My final question at this stage is about getting your views on the enforcement inspection appeals arrangements that could be legislated for under clause 3. Do you have any thoughts on that, above and beyond what you have submitted in your written evidence?

Mr McKee: Planning is my discipline, John. From that perspective, enforceability is likely to come through one of two mechanisms. One is a planning condition attached to the granting of planning permission; it is development, so it will need planning permission. I am thinking of the likes of a detention basin. The second mechanism is a section 76 planning agreement, in which a similar clause could be included. That would certainly give the planning authority and the statutory body the enforcement powers to pursue enforcement should there be a failure to deliver the detention basin or the wider SuDS. It will also give them the enforcement powers regarding what should be included with the planning application. Obviously, that will all be subject to policy coming through, and, in due course, the arrangements for the management and maintenance. For example, as part of the planning application process for Belmont Hall, we had to provide a management and maintenance plan, which, at the time, was assessed by the storm water management group and then peer-reviewed by a third-party engineering consultancy as part of the approval process. That was then subject to a planning condition that was attached to the granting of planning permission. That is certainly how we see its being enforceable from a planning perspective.

Mr Stewart: OK. That is really useful. Gents, thank you for your time today. I have no doubt that we will stay in touch. We really value your input on behalf of the sector, and it is essential that we stay in touch as we continue to scrutinise the legislation. I appreciate it.

Mr Dunne: Thank you, gentlemen, for here coming again and for your detailed evidence to date. I know how passionate you all are, and I know about the expertise that you bring to the table. That is appreciated. The scale of the challenge that we face is great. The word "crisis" has been mentioned, and it is an accurate word to describe where we are at the moment with the construction and waste water situation.

I have a couple of points about the approval body. I concur that having one overarching body — DFI Rivers — is the ideal scenario. How confident are you that that could work, given the resource challenges that the Department is facing? The Department often reminds us about its challenges with finances, resources, staff, expertise and so on. Are you confident that the Department has the capability, resources and capacity to be the sole approval body?

Mr Hardy: I think that it does, Stephen, to be honest. Ultimately, regardless of resources, DFI is the natural body to look after this. With the storm water management group, the process that we went through — we have suggested how difficult it was — changed quite a bit throughout, but, when we got to the end of it, there was almost a clear line of what needed to be ticked off as we went along. There is even a baseline there for what DFI needs to do at the minute. As we said earlier to John, incorporating a model that is used by the Scottish or Welsh bodies could enhance that completely. Obviously, we will need resources to be able to look at this, but we have liaised with experts in DFI Rivers on a regular basis as part of the storm water management group, and they have a clear understanding of what needs to be done and what needs to be signed off. It is just that there has been no mechanism for approval. The body will hopefully finalise that detail. I do not know whether that answers your question.

Mr Dunne: Yes, it does.

Mr McKee: The resources point is a really good one to raise. The Department's 'Statutory Consultations Annual Performance Report', which was published in October 2025 but reflected the statistics from 2023-24, showed that DFI Rivers responded on time to major planning applications 57% of the time and to local planning applications 61% of the time. There is room for improvement there, and we do not want additional expectations being placed on DFI Rivers, namely the assessment of SuDS, without its being supplied with the appropriate resources.

Mr Dunne: There is certainly a gap there. That leads me on to the point about the 11 councils. You said in your evidence that you are open to pilots in different council areas, but homebuilders cannot be in a scenario where each planning authority takes a completely different approach. We sometimes see 11 different approaches, and you will have seen that across Northern Ireland, whether it is connected to a small-scale extension to a home or a major development. Does that differentiation give you any concerns about linking in with the SuDS?

Mr McKee: It puts a very fine point on the need for clear guidance to which we all have to design and maintain and for the approval body to establish such guidance. If that is the case, all the councils should be looking to the expert consultee, whether that is DFI Rivers or another body. For us, that is where you would remove the potential for differentiation in assessment. I will not labour the point about open space, but the situation at Belmont Hall was novel for us at that time, which is why we ended up with the fence and the need to deliver the community garden.

In Derry City and Strabane District Council's planned strategy, for example, there is clear linkage between open space and SuDS opportunity. We are starting to see that, and, hopefully, with clear guidance, questions about safety and operation will be removed and the councils will simply be able to rely on the advice of the statutory consultee.

Mr Dunne: OK. Thank you for that. I will make a final point about maintenance costs. It gives me some concern to see what often happens in developments across the country. They are great when they are built, but, when the developer moves out and, rightly, on to another job, homeowners may face issues to do with ownership and maintenance of areas, even of grass. Often, it is difficult to get DFI to fully adopt those areas. It is about establishing how that will work. How do you see it working? Will it just be a case of the homeowners paying through increased annual fees for maintenance? When the SuDS is put in place, all is well for the first year or so, but you folks know better than any of us about the need for maintenance and the engineering aspect of that. Are there any concerns about that?

Mr Hardy: That depends on whether, through the SuDS approval body or another mechanism, the Department responsible, although maybe not responsible for the adoption, takes overarching responsibility for it. If you adopt the Welsh model, it depends on whether the council looks after the SuDS or whether it is maintained by a management company within its responsibility for the development.

Mr Dunne: That is where the differences can come into play.

Mr Hardy: Absolutely. ACC is working successfully with that model on Belmont, and the current management company is experienced in dealing with these things throughout the UK. It had its own maintenance policy in place on how to deal with such issues, so the transfer was easier. David might be able to expand on that.

Mr Magee: We worked with a company called Greenbelt, which is experienced in the maintenance of SuDS basins and ponds and all sorts of other permutations of SuDS. When we commenced work at Belmont, we had a fee structure for the maintenance of general open spaces, such as playgrounds and so on. The difference made by having to look after the basins — they came after the original planning approval — was valued at approximately £20 per household in the development, so it does not amount to a fortune.

There could be more complications if the Department starts to consider what it refers to as "SuDS trains" and you end up with swales along the edges of roads. Things such as that could create a wee bit more of a problem. The swales would probably be in verges that have been adopted by DFI Roads. Again, a clear line on policy is key to knowing how all the pieces will come together.

Mr Dunne: OK. Thank you, gentlemen.

Mr Boylan: You are very welcome, gentlemen. It is a complex issue for us all, to be honest. When it comes to the SuDS Bill, you are content with the process: you have raised issues that we, as a Committee, have identified and will put through the process.

I will concentrate on two things. It is hard not to talk about the PC and planning and the SuDS Bill. I agree with you on the issues that you have raised, and we will bring all that forward as part of our scrutiny of the Bill.

Mark, to be fair to you, you mentioned 50,000 homes. OK. Nobody is arguing about the social housing need or about the contribution that construction makes to the economy. If I got the support of the Committee to write to each local authority asking, "Where are you with your local development plans?" and "What is your projection for housing units in your council area over the next 10 years?", we would soon get an idea of what we are looking at. I mention that in the context of the challenge that we have with NIW and providing the necessary infrastructure. If we are serious about looking at it all, that is where we are.

I am being a wee bit long-winded, Chair, but I mention that because the 11 councils will all have to buy into the way forward on SuDS. That is the kind of thinking and broader conversation that we need to have. Mark, you mentioned the need for 50,000 units. We do not want to stifle economic growth. We have to tackle the need for social housing and everything else. That plays a big part in all this. I just want to get that point across.

I have read your paper on the PC stuff. David, you mentioned the last two. I think that we have had five PCs. We are talking about £1·2 billion now. I have been through them all: I have been here that long. If I look back to the submission to the Utility Regulator in 2015, and at PC21, my question is this: were those targets and that ambition realistic? PC28 will be the next one. I have had a chat with the Utility Regulator. The Chair suggested asking for the money. Even if we got the money from the Treasury in the morning, going by some of the PC targets annually, NIW would not be able to spend a certain amount of it. It has capacity only to use so much money anyway, so let us be realistic about that.

I am not arguing against the point that we need the funding to develop the infrastructure. You know the Minister's answers regarding some of the conversations that the Chair brought up earlier. The Utility Regulator will make the decision on PC28 and identify what funding needs to go to NIW. I am not saying that there is not a shortfall, but I am trying to get to a point where it is reasonable for us all to collectively work with councils to identify and try to meet the need that is out there. Where do you see all that happening? You have had a look at the PC, and it will play a big part. When it comes to the SuDS Bill, there is a big programme. David, you said that your understanding is that retrofitting would have a big part to play in the new PC. What are your views on the new PC and the challenges with it? I know that that is a difficult question, but that is where we are at, folks, if we are serious about having the conversation. I enjoyed the visit and seeing what is there. You all know that those are the big challenges. You may not want to answer that question, but that is my opinion and, to be fair, that is where I see some of the challenges.

Mr Fry: Let us take PC21 and its plan. We are coming to the end of that six-year window. In the run-up to PC21, NI Water carried out an extensive framework procurement exercise for its delivery partners. They had the assurance that the whole programme could be delivered if all the money were available. The civil engineering sector stepped up. A number of our members — not just large civil engineering companies, but small to medium-sized civil engineering companies — ramped up, effectively, on the promise that PC21 would be fully funded. There is one particular company that anticipated a turnover of around £80 million a year from some major projects that were part of PC21. It ended up receiving nothing. It ramped up on the basis of what it had been told about PC21.

We always talk about the "pipeline". In one sense, the PCs are very useful because they give you the pipeline. However, if you start that pipeline without the funding certainty, you will eventually run into an issue. As we approach PC28, one of the issues is that, this coming autumn, NI Water will start to engage with our members about the next framework. A lot of the local civil engineering contractors, which employ your local constituents etc, will look at PC28 and ask, "Is PC28 any more deliverable than PC21?". We understand that NI Water's ask is around £2·9 billion over five years. Will there be financial assurance around the ramping up? If the answer is no, that will be reflected in how contractors view, and how they price, that framework. That is the nature of how those work. Contractors are delivering frameworks in Britain and the South that have an assurance on not just a pipeline but, critically, funding. We have seen a lot of our civil engineering members moving into the South to deliver works for Irish Water, because it requires a similar type of work to be done and it can tell you right now how much funding it will provide over a decade. Effectively, it can give that guarantee through its frameworks. We cannot.

Is it perfectly possible for the Northern Ireland Executive to fund the PC28 requirement, based on the block figures that the UK Government have made available? Yes. However, of the £900-odd million for next year's DFI budget — I talked earlier about what you are left with when you take out earmarked allocations etc — it would need to put £600 million into NI Water. That would mean all its the budget going on NI Water and the A5. That is all that DFI would be able to do. Unless something else is added to the equation, it will not be deliverable, based on the figures. The capacity of the construction sector is a different question. The issue is people from that sector approaching this and saying, "It's not going to happen?".

Mr Boylan: I appreciate that. That is why I put it to you. It is a difficult one.

All of us will see the PC and think that it is OK. After PC28 is produced, NIW will ask for £3 billion. It is our job as a scrutiny Committee to make sure that that is based on data, is evidence-driven and is factually correct. That is my point. I am not arguing with you. You have a big part to play in that, because you have a job of work to do to contribute to the economy and meet the housing need. That is fine. Nobody is arguing with that point.

This is my final point, but I could talk about the subject all day. There is an old planning policy statement (PPS) — I cannot remember its number — on open space. It is now in the strategic planning policy statement (SPPS) collectively. You obviously have concerns about the open space policy. Do we need a further conversation about that, or is the issue solely council-driven? What are your views on that? I have some sympathy, because we argue for open space in housing developments. There was a broader conversation in those days. What are your views on that?

Mr McKee: I think that what you are referring to is PPS 8 on open space, sport and outdoor recreation, which was published in 2004. We probably were not doing a great deal on soft SuDS at that time; it was all hard SuDS. I know that we still do a lot of that. It did not really grasp SuDS. It had a fairly broad typology of what open space could be, but it did not include SuDS. Again, to go back to the guidance and policy point, we need to be very clear that SuDS can and should be part of the delivery of open space in a given development and should contribute to the 10% or 15% requirement, in accordance with each of the council's planned strategies. The councils' planned strategies that we have seen adopted embrace the need for SuDS to form part of open space. However, the problem that we have is with the next layer. There needs to be very clear policy and guidance that says, "You do not need a fence for a detention basin. Here is how you could add biodiversity value through, for example, a planting scheme". Antrim Construction Company, to its credit, worked very hard on that at Belmont Hall, given its proximity to the Sixmilewater river and the strong ecology there. As we have said a number of times, it all comes back to the need for clear policy and guidance. The planned strategies are set up in such a way that the policy can speak to it, but it needs to come through the approval body, be it DFI Rivers or a component of it.

Mr Boylan: This is my final point. There will need to be clear guidance on elements of the SuDS Bill as well. Thank you very much, Chair, for your latitude.

The Chairperson (Mr Martin): No problems, Cathal. There is special latitude for you.

Mr McMurray: Hopefully, I will not require too much latitude. [Laughter.]

Mr Boylan: I did not speak last week. [Laughter.]

Mr McMurray: You are making up your quota. My first question brings it back to the Bill, if that makes sense. From your reading, are there any definitions or clauses that need to be clarified ? We are going through the Bill and will have sessions on it, but is there anything from your end? We are here to get evidence from you on the Bill. Is there anything curious that needs to be specifically looked at?

Mr Fry: No. Broadly speaking, and with credit to the DFI officials who took forward the consultation on the initial guidance, our main focus is on the guidance consultations. We have had one consultation, and there will be at least another one. To give them absolute credit, they have worked very closely with us from the outset of the process. They were on the site visit and they were also on a previous visit. Where the Bill is, in effect, giving them the power to lay the guidance for soft SuDS, a lot of our focus will be on the evolution of that guidance. We are happy with the Bill as it is, with the caveat that a keen eye will need to be kept on the guidance as it moves forward.

Mr McMurray: I remember that site visit, and, in the nicest possible way, I still get a cold shiver. It was a very cold day, even in my nice warm jacket.

The Chairperson (Mr Martin): There is a microclimate in Antrim, Andrew. I remember that day.

Mr Boylan: Absolutely. I remember that.

Mr McMurray: Back to retrofitting. We have talked about the open spaces and all the rest of it. Again, you are very supportive of the open spaces and the play spaces. When it comes to retrofitting, even aside from the costs, how viable is it, given the spatial squeeze in our cities, towns and villages? I speak to residents who are concerned about developments and drainage and all the rest of it, and you see this as a way to help. How practical is it?

Mr Hardy: It will only work in areas with an available area of green space and where it is taken that it is not encroaching on the open space. It is possible, but where it can be put is limited.

Mr Fry: I will leave it to NI Water. It shared with us some of the proposals that it will be putting into PC28 for retrofitting. A lot of it is focused on areas where there is or has been a relatively significant flooding issue with storm water. At Belmont Hall, we are dealing with storm water, and this is a retrofitting to deal with storm water. For example, there has been a significant flooding issue in south Belfast at Cranmore Park and the general residential part of the Lisburn Road for a long time. NI Water is looking at a project to offset some storm water through Cranmore Park, and it will help at the fringes, but it is quite intensive.

Mr Magee: We need to be careful not to mix the soft SuDS that you saw at Belmont Hall with the retrofitting. There are options for hard engineered solutions, which would require the extraction of storm water from the combined systems, holding it in tanks or oversized pipes, and then slowly releasing it through hydro breaks. That is another way of extracting the storm water out of the combined sewer system, and that in itself will help. In order to sell the development that we are proposing, in advance of putting in planning applications, we now find ourselves going around towns looking at areas where there are combined sewers and coming up with schemes to introduce some storm water pipes that will slowly release the water to free up capacity solely for the foul water. I am just making the point that we need to be careful that the soft SuDS — the basins and ponds — are not, perhaps, the retrofit. There are other options.

Mr McMurray: Finally, I picked up on Mr Spence making reference to the three-pronged approach and saying that a step change was required. I am not sure whether that was in reference to the three-pronged approach or not. There is the infrastructure levy. We have talked about this before, but, given the environmental, societal and economic issues, bracketing it as an infrastructure levy, as I understand that, maybe does a disservice to the amount of good that it could do. I might be straying into Mr Boylan's territory by making a rhetorical comment as much as anything else.

The Chairperson (Mr Martin): Uh-oh.

Mr Boylan: You should get it off your chest there.

Mr McMurray: We talk in other sectors about a first-mover penalty. Developer contributors, in my head, are a first-mover penalty. The Minister for the Economy socialised the costs of electricity connections and breached the dam of raising rates levels and suchlike. Give us a bit more expansion on the whole idea of a social levy. Where does it need to run past, per se? Are there further clarifications? You mentioned that the governance structure would not impinge upon borrowing. It is the technicalities of it, where it needs to go and your opinions on some of the things that were touched on there. Thank you, Chair, for your latitude.

Mr Spence: I will start, and colleagues may jump in. When we looked at this last summer, we worked within certain parameters, and, as we have discussed, the block grant was one of those. Our opening position was to assume that there was no immediate extra money coming through the block grant and that we had to find the money somewhere to do something. We estimated the gap with what had, at that stage, been agreed with the Utility Regulator as the absolute minimum that needs to be done to NI Water to fund all its requirements. We looked at possible mechanisms that, very importantly, would retain the public ownership of NI Water. This was certainly never intended to resemble privatisation in any way, shape or form. We know that that is not a viable option. There are no good examples of that being a viable option. We were looking at mechanisms that would allow the collection of additional funds for NI Water across the general population whilst providing protections for the most vulnerable in society.

That was the starting point, and the domestic rates system appears to be a viable mechanism for doing that. That mechanism already provides protections for the most vulnerable in society. People on various benefits and in social housing would be protected. It is also a progressive levy that we are proposing. It would be based on the valuation of the house, so it would be progressive in the sense that people in a lower-value home would contribute less. The figures that we have recently revised suggest that, for the lowest-value home with Land and Property Services (LPS) currently, that would be 44p a week and would rise to £3·90 a week, based on the current upper cap for the valuation of homes. Those, again, are all political decisions on where the cap lies and how far that can go. We are talking about an average of £1·25 a week per household, starting at 44p a week. To us, that felt fair. As I said, it provides protections. There will be elements of society that we would not expect to contribute to that at all, and that is fair and correct. It would be progressive in the sense that those who are more affluent would pay more. That feels right and progressive. On any level, 44p a week, £1·25 a week or up to £3·90 a week feels affordable. In normal dialogue, to most people, that sounds like an affordable solution. That is not to say that any of this is easy. We think that this is an easier option and process than setting up an alternative way to fund NI Water, in the sense that it is an existing government system for raising funds, and it is within the gift of the Executive to do that.

We also took some comfort from the draft Budget, where, already, a 5% increase to the rates has been proposed. That is quite a bit more than what we are proposing, so what is already proposed in the draft Budget could fully fund what we are asking for and leave some aside for other general purposes, of which I know there are many. Every Minister has pressures — we are not blind to that — but we feel that this is a fundamental, underlying problem in our economy. This is a structural problem. We are all about proposals. I appreciate that it is easy to stand on the sidelines and criticise the hard work that the Executive have to do, but we feel that we have brought forward a proposal that is worthy of discussion and should not be dismissed. It is fair, progressive, affordable and, we think, eminently doable, and it would bring benefits. That was the thinking behind it, Andrew.

The Chairperson (Mr Martin): Are you happy enough, Andrew?

Mr McMurray: Yes, thank you, Chair.

Mr Harvey: I am thinking about the soft SuDS and the 10% of land that must be set aside for open space. I believe that that should be combined. Do you agree that, in all cases, it is all about underground works, heights, levels and flows, and that anywhere can be turned into an open space if the underground work is in proper order?

Mr Hardy: What underground work do you mean? Do you meant the pipework and stuff like that?

Mr Harvey: Yes, the pipework, the flows and where everything goes. The existing level in the one that we looked at could be raised easily to make it more usable, while what is underground is still the same.

Mr Hardy: Yes, it is possible if the site topography allows that. However, if it is a flat site, it is pretty difficult, because the pipework falls at a gradient, so the outlet would have to be deeper. Predominantly, you are looking for a sloping site with a low point to which the natural water would migrate and flow. That is helpful. Technically, you could make it shallower, but then the surface area might be slightly bigger. There is a balance, but it is possible. It comes down to the site topography.

Mr Harvey: There might also be slightly more cost for below-ground work, but it would be a plus point for a build. In conversations with DFI Rivers, did you feel that it was content to take on the charge for the soft SuDS?

Mr Hardy: Initially, at the storm water management group, there was no engagement, decision or forthcomingness to adopt anything. The most diplomatic way to put it is that we were going through uncharted territory and there was a natural apprehension about anybody making the decision. That is why we are saying that it is paramount that we have the parameters set so that we do not have that disparity in later discussions. It goes back to that being clear.

Mr Harvey: Mark, you mentioned that Newry was at capacity, and you mentioned a cost of £120 million for a rebuild of the existing water treatment facility. Is it not possible in some cases to extend a water treatment works? They are doing a great job. I have visited a few; they are very impressive. They do not all necessarily need a complete new build. An extension might cope with some of the proposed developments. What are your thoughts on that?

Mr Spence: David, actually you mentioned it.

Mr Fry: The funding of £26 million that the Infrastructure Minister announced in June monitoring with NI Water was a pretty innovative solution. All credit to NI Water for what it is doing in Newry, working with, I think, ABP to better manage the flows. Other locations in Northern Ireland that have a similar kind of commercial set-up in place are being considered because, if waste output can be better managed, that, in and of itself, can unlock development. What is being proposed in Newry will unlock development. We are still in the contract delivery side of that. I think that construction has commenced on only certain elements of that. It will probably be next year or the year after before we get to a point of really unlocking the housing element.

The difficulty is that, when you do those kinds of solutions, they can deal with only so much. They can deal with regulations only as they evolve as well. In the original PC21 plan, the proposal was for a scheme of about £100 million to completely reopen Newry. When you exhaust the capacity that is unlocked through that investment, you will go back to needing to do that scheme again, because you will have taken out what you can take out. It also has to be emphasised that the £107 million that is talked about today for a full Newry scheme is in today's prices. By the time you enter PC28, that will not be £107 million any more. That goes back to our main point about the price controls. Had we invested properly during PC15, Newry would not need to cost at least £107 million.

Mr Harvey: And that is just an example.

Mr Fry: Yes. At the same time, what is being proposed in Newry is very innovative and incredibly helpful, given the constrained circumstances that we are in.

Mr McHugh: Tá fáilte romhaibh uilig.

It was very interesting to hear your presentation. A lot of ground has been covered, but a couple of areas arose for me in the conversations. I think that, in response to a question from our Deputy Chair, you mentioned that the Cardiff model is a good one. When the project was completed, it was taken on by the local council. Is that a possibility here in the North of Ireland, in the same way that DFI Roads adopts sites and so on after they have been completed to its satisfaction?

That brings me to another element of that question. One of the difficulties that we have often had when it comes to the adoption of roads and so on is that the developer has gone bust. There may be a bond in place to ensure that, in the event of a developer's going bust, the residents still receive the service that they are entitled to. In the event of moving in that direction, or even currently in the event of a developer's going bust after a period of time, what happens to the management of, say, the fees that are being paid by the residents? Who are they paying them to, and who takes on that responsibility?

Finally, I will put all of my statements together at the one time. You also talked about what was happening in the Republic of Ireland. I accept that it is much wealthier than we are here in the North. It is also a fact that the Republic is in charge of its own affairs. Are there any other lessons or good practice that we can learn from what is happening in the Republic and incorporate into any Bill that is being developed?

Mr Hardy: I will answer on the Cardiff element. The Welsh Government were the front runners in SuDS approval, adoption and implementation. The Scottish Government are up there as well, with the Scottish Environment Protection Agency (SEPA) looking after that. Personally, our business went to Cardiff and spoke directly to the people on several occasions. We were invited over to look at some of the areas where they had these basins to try to adopt and take on board what they were doing over there. It was just a suggestion. To answer your question, it could be implemented.

On the legislation bit, I am not too sure whether that needs to change to allow that to happen. I am sure that there would have to be some course of reviewing how that has changed, whether that is done by a local government office or the umbrella body takes that over. I am not sure how that works at the minute. There is a mechanism for the roads to be adopted, so it should be straightforward, maybe under the same avenue as that, but that would need to be investigated by local government to do that.

Mr McHugh: My other question was about a developer going bust.

Mr Spence: It might be useful to explain how it works at Belmont.

Mr Magee: Thinking about the system that we have there, Greenbelt is the management company. Sam will keep me right on this from a planning perspective, but we have a planning condition whereby we have to establish a management company. That is done, and it has to be retained in perpetuity. If Greenbelt were to go bust, never mind the developer, the maintenance of those open space areas would have to continue. I believe that that whole system is protected.

You asked about a developer going bust. We are developing the site in phases so we are in a process of continually completing, and, as we complete part of the development, Greenbelt assumes responsibility for the maintenance of those areas. It is not being left. The full transfer of ownership of the land that Greenbelt is maintaining does not take place until the development is complete, but there is a mechanism whereby it is continually taking sections, and the people who are moving in contribute to that on an annual basis. The fee is set by Greenbelt on an annual basis, and that is reviewed to ensure that it has the finance available to carry out the maintenance that has been approved through the planning system.

Mr McHugh: David commented on what was happening in the Republic and how a developer was £80 million outstanding, as such; it was not forthcoming. Therefore, it would affect the developer's capacity to assess the likes of that. Are there any other lessons to be learned from what happens in the Republic?

Mr Fry: It is about the criticality of the pipeline. A multi-year budget will undoubtedly help, because it will give that security. When you are in a one-year budget cycle, there are always concerns. You know that, if you are in a contract — a contractually committed scheme — and are, for example, building a new school, you know that you will not be a scenario where, when the new financial year commences, you will suddenly not be able to complete that. Having that here for the first time in effectively 15 years would be of benefit, even if it is on a much more limited scale than what they are doing in the South or in Britain.

In any of our asks, or, going back many decades, our predecessors' asks, the security of the pipeline is the number-one piece. Yes, they have a lot more resources available. Our argument is that there are things that we could do to grow it within the powers that already lie in this place, but that is a political decision. We are giving an option.

Mr McHugh: What if it were in the Republic, where there are no water charges?

Mr Fry: The Republic of Ireland has taken that position. I suppose we are getting into semantics. We are not advocating water charges. We listened carefully to what the Fiscal Council said and looked at what it published in its report last year about what a water charge would be here, if we were to go that model. Our strong view is that there is a means to do that through which Northern Ireland Water would remain a public company. It has a £400 million subvention this year. Even if you were to add on the kind of money that we are talking about from an infrastructure levy to the business rate income, it would be about £150 million per year. The £400 million subvention means that it would still be a public company by a long shot.

Mr McHugh: Go raibh maith agat.

Mr McNulty: Thanks, folks. It is great to have people with so much expertise and passion in the room, who understand the barriers to development and the challenges we face and who can come up with solutions to overcome those. No drains, no cranes. Your report, which was issued in the past few days, said that the:

to our economy. When the Minister came forward with her three-pronged approach — or, as I like to characterise it, her three-strawed approach — as the big fix for the infrastructure challenges that NI Water faced, did you rub your hands with glee and say, "That is it sorted now, folks; now we are trucking"? Did the Minister's three-pronged approach inspire confidence? Did she consult you before proposing her three-pronged or, rather, three-strawed approach?

Mr Spence: We have had many discussions with the Minister and her predecessor, who started the three-pronged approach. We have always been very clear that nothing is wrong with any of the three prongs. We support developer contributions in the voluntary space. We are here to support SuDS. Good luck with getting extra funding from around the Executive table. If we were to sit in front of every Committee, we would see that they all face similar pressures. We understand that there is no magic money tree. Each prong of the three-pronged approach is worthy, but we have always been concerned that none of them address the extent of the problem that we have, unless some huge amount of money were to suddenly become available to the Executive. As David said, direct extra funding from Westminster would be ideal, but, unfortunately, nobody thinks that such funding is around the corner.

We speak not just for the construction sector. Although this is a construction matter, because construction enables the wider economy, which is why the Northern Ireland Chamber of Commerce and Industry, Manufacturing NI, the Northern Ireland Federation of Housing Associations and the Chartered Institute of Housing are on board. Each area of our economic, social and environmental life is affected by the inability to invest sufficiently in NI Water. It is absolutely right to say that, even if all the money were to become available today, we could not fix all the problems today, but we have to start somewhere, and we have to start sooner, because we are dealing with decades of underinvestment. There is no better time to start than now.

We believe that the general public are starting to feel the pressure on NI Water. It is not a topic that people generally chat about, but it pops up in normal discourse now, because people are starting to see a stall in housing developments. Anecdotally, we know about factories that were coming to this place from elsewhere that have now been built in Poland and Dublin, which has taken hundreds, if not thousands, of job opportunities away from this place. It is starting to impact on the delivery of schools and SEN provision for existing schools. It is starting to impact on all facets of everyday life, not least on the environment, which have a huge value.

We are concerned. The three-pronged approach has merit, but it could probably never address the extent of the problem and, certainly, is not doing so now. That is why we are bringing solutions that we believe to be worthy of discussion.

Mr McNulty: I have an issue with the Minister's presentation of the three-pronged approach as the solution to all NI Water's problems and other infrastructure problems with capacity and treatment. You have said that we need a "step change", and the three-pronged approach is not that step change.

Mr Spence: Not by itself.

Mr McNulty: OK. Do you ever look over the hedge at the South with envy and think, "I wish we had a bit of that"? Do you wish you had the certainty and opportunities that have been provided to the construction industry there and he ambition that has been demonstrated, whilst we whistle in the wind?

Mr Spence: Putting to one side the funding and its sources in both places, we are, without a doubt, envious of their having a long-term vision for capital investment in all aspects of infrastructure. The apparent inability to produce a 10-year strategic investment plan is a source of frustration for the industry. The agreement of a fixed four-year capital budget is of much more importance to the industry, because the closer it is to us, the more value it has. As David said, for the first time in 15 years, we have an opportunity to have that in place. In our minds, such a budget is vital if there is to be confidence among those in the construction industry, developers who want to invest in this place and employers who want to employ local people to do jobs locally, rather than to put them on planes every day of the week to work in other places, as is currently the case.

Certain things can be done to raise confidence. One of those is to get agreement on the multi-year Budget. Another is a strategic investment plan, which would give us a longer horizon. There is nervousness in Government, understandably, about producing a 10-year plan, potentially not being able to deliver it exactly as planned and having people complaining, "You didn't exactly do it". We would much rather have the shape of it. We understand that priorities move around, as things come in and leave, but give us the shape of it for 10 years, and then break it down into four-year periods that we can count on in making business and commercial decisions. Start delivering. We have a need of £1·7 billion in schools; our health estate is in disarray; 50,000 people are literally homeless; and we have 50,000 homes that we would like to build. All those things will take time, and, although all of them are difficult, they are all possible. The one thing that would kill that dead is a lack of vision and infrastructure investment.

To answer your question, yes, we are envious of the clarity that exists in the South. The construction industry there has a far more favourable funding environment, and we do not have that at this point. If we want to enable our economy to grow, however, that would be an enabler. For us to get to that point, we need to make the difficult decision up front to make that investment. That investment will pay huge dividends to the wider economy.

Mr McNulty: Ghost Budgets will not cut it. The South does not do ghost Budgets, either.

'Newry Next' is an exciting plan that was proposed, within the past couple of weeks, by Paschal Taggart and Ger Perdisatt. I declare an interest, as I have been working with those gentlemen from the start, and I met them last October. They have come forward with blue-sky thinking and a big vision and ambition for the Newry-Banbridge corridor, which would provide affordable and social homes in Newry for local people first. Their plan would also be a huge catalyst for the economy and would have a multiplier effect, with the potential to create £1·5 billion in fiscal return, 3,000 construction jobs and 1,200 permanent jobs for local people. To what extent do you support that proposal? Should it be properly explored by our Infrastructure Minister? Do you agree that, instead of whistling in the wind with a three-strawed approach, the Minister should do something real and meaningful that can make a difference to the lives of people here and be a catalyst for moving the island forward in a positive manner? Where does the industry sit on that?

Mr Spence: We are always receptive to exciting proposals and proposals that will provide regional investment. The city deals are another great example of how we can focus on infrastructure investment. However, even the existing city deals that are being rolled out are hitting problems with infrastructure connections, primarily water. The expansion of Magee campus may also be hit with those problems.

We are having to make rational decisions on the ground between the needs of social housing and student housing, for example. It is important that those types of studies are conducted because they give us an aspiration and the reason to invest. All of that is predicated on our having sustainable and reliable funding that can be ring-fenced for key projects that are identified and that the Executive would adopt as, if you like, priority investments. That was the purpose of the city deals, which received Treasury investment as well. Those are all good incentives for the economy, but, without the underlying infrastructure investment, we could be waiting for them.

Mr McNulty: The funding model proposed is the Shared Island Fund and INTERREG, which would potentially take that off the Executive's funding burden. Should our Minister be properly interrogating and exploring that?

Mr Fry: Any avenue should be explored. Clearly, without doing what is currently priced — that is, a £107 million upgrade of Newry's waste water system — you cannot deliver that report.

Mr McNulty: That is in —.

Mr Fry: Yes. That is a fundamental building block. Without that —

Mr McNulty: No drains, no cranes.

Mr Fry: — it is not achievable. Banbridge's system is pretty much at capacity, as it stands. Although it is still open, it is relatively close to capacity at the minute. Arguably, the £107 million could be an undervaluation, because we can go back to the point that that scheme — the full upgrade in Newry — was in this price control period. NI Water will make its capital submission to the regulator in April, I think, and all those projects will increasingly have to be re-evaluated in the context of the environmental piece as much as the economic piece in a way that might not have been done to the same extent previously. That document has been well thought through, and it is very detailed. Having looked at it, there is nothing in it with which we disagree, but, without doing that bigger Newry upgrade, the 'Newry Next' plan is not possible.

Mr McNulty: True.

The SuDS Bill is a catch-up Bill; come on, folks. It is presented as some wonderful piece of legislation, but it is a catch-up Bill. As I described to you, I was designing SuDS on-site in schemes nearly 25 years ago in Dublin as a civil engineer. When it comes to how the design criteria for SuDS and soft SuDS should be applied, we have the 'Design Manual for Roads and Bridges' for British roads. There are multiple departures from that in regard to the A1 dualling project. Which document provides guidance on SuDS? In the South, each council area, be it Dublin or Wicklow etc, might have different criteria. What is your thinking on having one universal document to govern the design of hard and soft SuDS in schemes?

Mr McKee: One central guidance document is probably the right way to go, as is having one approval body that would function as a statutory consultee in the planning process, much as DFI Roads and DFI Rivers do. Rather than having disparate guidance across a range of councils, we could have a central document, produced by DFI, to which all councils could attach material weight and on which they could engage that statutory consultee for expert review of the proposal at hand.

Mr McNulty: Should the statutory consultee be

?

Mr McKee: We think so. To have it properly resourced is probably the right direction to go in.

Mr McNulty: Folks, thank you very much for your evidence.

The Chairperson (Mr Martin): Thank you, Justin. That is everybody. I want to check a couple of things for my understanding. One question is on SuDS, and one is on a wider issue. Stop me if I get any of this wrong.

Say that one of you gentlemen decides to build 15 houses in Londonderry as a part of a development. When you build those houses, all those connections are correct and separate, meaning that there is a storm drain and a sewage connection, so any new houses that are built have the correct sewage system already in place.

A SuDS reduces the amount of storm water, which probably should be going into a river, that goes into the system and reduces the level of flow into that river and slowly disperses the water. I see that people are still nodding. From all of that we have discussed today, it seems that our issue is because storm water is going into sewerage pipes and increasing the volume there. Those instances are generally called misconnections, and they mean that a lot of volume goes into sewage treatment plants, which is problematic. When a sewage treatment plant is under too much pressure, it deals with that storm water by sending it into a river. So far, so good.

Mr Hardy: I will comment on one item. The foul sewers are known as "combined sewers" when they carry both storm and foul. That is where the issue is, because, going back 40 or 50 years, a lot of combined sewers were built. Those convey both types of water, and that is what is overexerting the waste water treatment plants.

The Chairperson (Mr Martin): It puts the pressure on them.

Mr Hardy: Yes. The storm water offsetting mechanism tries to remove the storm water from the combined sewer and direct it into a receptor, which is a river or designated storm water pipe. Doing so releases the capacity within the combined sewer.

Mr Magee: It is also fair to say that, over the past 40 years, I would hazard a guess, no new developments have been combined sewers. They have been separate storm and foul sewers. However, where the two pipes discharge on to a main highway or whatever, there might only be one pipe at that position, and that would require the storm and the foul to combine at that point and discharge into what Mark has talked about: the combined sewer.

Mr Hardy: Article 161 of the Water and Sewerage Services (Northern Ireland) Order 2006, which covers adoption, means that NI Water will not let us do a combined system on a site. It has to be a separate system. That was also the case back when we had article 17 procedures, before they became article 161 procedures.

The Chairperson (Mr Martin): The stuff that is being built at the minute is being built correctly, and the SuDS, if it goes through the new builds in Londonderry —.

Mr Boylan: Is that the same as Derry, boys? I want to be clear. [Inaudible.]

The Chairperson (Mr Martin): Thanks for that; you have managed to get it in twice. The SuDS will reduce the amount of water going into what possibly could be a combined sewer and slow it down. Is that fair to say?

Mr Hardy: The distinction is that the soft SuDS retains the water that we discharge to a river, watercourse, storm pipe, combined sewer or whatever. However, the soft SuDS removes the necessity for hardware —

The Chairperson (Mr Martin): Hard SuDS.

Mr Hardy: — such as over-site pipes and that sort of stuff. It helps the environment and all those bonus words.

Mr Magee: The common denominator for soft and hard SuDS is that there is a hydrobrake, which controls the flow rate of the storm water into a river or watercourse. That is key.

The Chairperson (Mr Martin): This is a final point on the wider issues. We have talked about the Bill. You are generally supportive of it, as is the Committee. However, some of the issues that we have talked about and raised today relate to what will happen if we do not get a handle on the sewerage misconnections, as well as the range of issues that Northern Ireland faces and the impact of those. A lot of the stuff that we discussed, such as sewerage and SuDS, is mundane and, perhaps, not as political as some other things that come through the Assembly. They are, perhaps, not so eye-catching for the general public. We have talked about that as well. We have talked about the funding that is required to try to fix those things. My question picks up on some of what was talked about today. Is it fair to say that, if we do not fix the issue, young families who want to buy a house will find that house more expensive because we are limiting the amount of houses that will be for sale and that private industry may pick somewhere else to invest for the same reason, which would limit jobs in Northern Ireland? That would generally lead to an increase in mortgages. Is it unreasonable to suggest that any of those things will be the outcome if we do not solve those problems?

Mr Magee: I work for a 60-year-old company. It is the same age as me, but that is beside the point. At the minute, we are very concerned about the future of the company. We are living in a time when the number of properties that we can build is diminishing annually. We are not replacing the land bank in the way in which we were able to replace it 15 years ago. We need a plan as well. Not only do the Executive need to plan for the future and for the finances that to get it sorted, but we, as a company, need to plan.

The other aspect that can come in here is whether, when we see our numbers drop to a point where we need to make hard decisions, we will continue to build 150 houses a year or look to prolong the life of the company by reducing numbers. From a company perspective, we have very hard decisions to make in the not-too-distant future. That is worrying.

The Chairperson (Mr Martin): Thank you for that, David. Whilst we have been in Committee, I have had a look. In a press release from February 2025, the Minister said that it was:

That is a verbatim quotation from the Minister in February 2025. Does anyone want to react to that? It seems a little at odds with what we have been talking about.

Mr Fry: Those types of reports, which come from Government and are also produced by other agencies, are based on cumulative turnover.

The Chairperson (Mr Martin): Right. Will you just explain what that means?

Mr Fry: It is the amount of money. The Northern Ireland Executive's capital budget this year was higher than their capital budget last year. It therefore follows that the amount that is being spent through the construction sector is higher this year than it was last year.

The Chairperson (Mr Martin): OK.

Mr Fry: If it were not going up year-on-year, we would be in even more trouble than we already are. There is probably much more of a focus on repair and maintenance now. Maintenance is a much bigger focus than it was. The actual output has been going up consistently year-on-year. Since the 2008 recession, our low point was probably 2012. A lot of money that had come from the previous Labour Government was still moving around and had kind of washed through the system. Once the coalition came in, there was a drop. However, ever since year 1 of the Tory/Liberal Democrat coalition, it has built up year-on-year again. That is what you would expect.

The Chairperson (Mr Martin): That is fine. Justin, you wanted to come back in.

Mr McNulty: Yes, very quickly. With regard to the separation piece, Newry has benefited from separation and offsetting upstream. Will you clarify what has happened with ABP? Has effluent been removed from that facility to free up capacity?

Mr Fry: Yes. Again, I will leave it to NI Water to give you more detail, but, certainly, I think that it suggested to us that there were four other areas with a similar type of model with that kind of heavy commercial facility, where you could find something to do. I stand to be corrected, but I think that Cookstown, Enniskillen and Dungannon were referenced as towns where a similar kind of agri-commercial set-up is going on where something could be done. Again, however, those are relatively small-scale investments that are time-bound. When it comes to what they unlock, it is not the case that doing something in Dungannon, for example, will mean that every housebuilder will suddenly flock there and turn it into a new Mecca or something like that. It is a time-bound investment to get you over what is probably a five-year hump at a maximum.

Mr McKee: It is not actually about completely reopening the catchment for line connection. We were in the position where we had to do an offsetting, and we no longer have to do that. We are involved in a scheme for 50 social homes in Newry. What it has done is reduce the level of offsetting that we have to do. It has not simply created a connection. We still have offsetting at a substantial cost. It has helped, but it has not completely fixed the problem.

Mr McNulty: Is that at Downshire Road?

Mr McKee: Carnagat Road.

Mr Spence: Our understanding is that the private business there made a substantial contribution to those capital costs as well.

Mr McNulty: Thanks, folks.

The Chairperson (Mr Martin): Thank you very much for your evidence. I do not think that Dungannon has ever been described as a "Mecca" before, but I will be sure to put that to my former Committee colleague Keith Buchanan and ask him whether he agrees.

Thank you very much, gentlemen, for attending the meeting. Not all our evidence sessions are as long as this one. It is crucial stuff — it is — for Northern Ireland. Some of the evidence that we have heard today is new. Some of it was stuff of which I was aware. This single issue speaks to the importance of the Committee's work. Earlier, Andrew mentioned the strands that it feeds into. For example, a young family may want to try to buy a house and find that, because we are not building — we cannot build — enough houses, it is £20,000 more than it was last year. We — not us but the Minister and DFI — need to solve that problem. It is a wider Executive issue as well. Thank you very much for your time. We really appreciate it.