Labour has raised concerns of where exactly the €170 million is coming from to refund water charges.

Spokesperson on Social Protection, Senator Ged Nash said that the Christmas Bonus may be scrapped, and spending on frontline public services curtailed to pay for it.

There is also an outstanding bill of €128 million to cover the cost of bringing forward the Lansdowne Road agreement pay increase that must be met from existing resources.

Senator Nash said: "I am deeply concerned that the current underspend of nearly €60 million in Social Protection will be raided to pay for this, leaving nothing for the Christmas bonus this year.

"As the Government cannot use supplementary estimates this year, the bonus would have to be paid for from existing Department resources. The savings from lower unemployment have been used before to fund the Christmas bonus, but if it is raided for the water refunds, there will be no extra payment this Christmas.

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"The Minister for Social Protection has been warned in her Ministerial brief that the bonus isn't funded for this year. Combined with the €120 million cost of bringing the Lansdowne Road pay increase forward to April, there will be limited resources available for the bonus, never mind a refund.

"Minister Regina Doherty should outline whether she will pay a Christmas bonus, and where the money will come from.

"I am also concerned that there are major under spends across a number of vital public services - from health to education to housing. This money was provided for essential services and I am worried that pressure will now be applied on line departments to put the brakes on spending so the Taoiseach can pay for his refund. This money was budgeted for a reason - to fund our hospitals and schools, and help tackle the housing crisis.

"There are a number of other sources that could be used to pay for the refund, including delaying the small tax cuts planned in this year's Budget for a year. The cost of servicing the national debt has also been much lower than expected, with savings of €89 million in the first six months of the year. By year end that would cover the full cost of the refund."

(CD)