Minister for Housing Simon Coveney has declined to say if Fine Gael is in favour of refunding householders who paid their water charges.
The party is still at odds with Fianna Fáil over the future of the levies and in particular whether an excessive usage charge should be imposed on individual householders.
In a proposed compromise, Mr Coveney agreed to examine the 2007 Water Services Act, which has been proposed by Fianna Fáil as a method of penalising householders, to determine whether it meets European law.
In return, Fianna Fáil will agree to amend the legislation to define an excessive usage limit and fines of €5,000 would apply to households over that.
However, fresh divisions emerged between the two parties on Friday as they both submitted their position papers to the Oireachtas committee examining the issue.
In its document, Fine Gael states it wants the metering programme to continue and excessive charging to be defined by that system.
It also stresses that the people who did not pay their charges should be pursued but admitted this must have regard to the potential administrative costs of recovery.
The party does not state a position on refunds for those who paid their charges, only insisting those who have paid their water bills to date should be treated no less favourably than those who have not.
Further doubt
Mr Coveney also raised further doubt over Fine Gael’s position on refunds on Friday.
Speaking in Co Galway, the Minister said: “I read in the papers that Fine Gael is open to refunds or whatever. That isn’t actually necessarily the case.”
Fianna Fáil, in its submission, argues for refunds to be distributed by the Revenue Commissioners but states the conservation grant must be deducted from the payment.
The party said it opposes further investment in metering but states the underspend in the metering programme should be invested in district meters.
Fine Gael and Labour have both questioned Fianna Fáil's stance on the levies despite the party publishing legal opinion by senior counsel Conleth Bradley and barrister Darren Lehane.
That advice states water charges can be abolished and Ireland can still meet requirements under European law.
Fine Gael has requested the Oireachtas legal team examine Fianna Fáil’s advice and assess if it is accurate.
Its members on the water committee have also proposed the chair Pádraig O’Ceidigh meet with the Attorney General to examine her advice.
Expose
A 30-page opinion given to Ministers outlines clearly that no charging regime would be contrary to European law and could expose Ireland to fines.
Labour TD Jan O’Sullivan also criticised Fianna Fáil, saying their legal advice was wrong.
Ms O'Sullivan said any derogation offered to Ireland by Europe has expired due to the commitment of Fianna Fáil and the Green Party in 2010 to introduce charges.
"Fianna Fáil seem to think they could fix the mess they made of all this in Government if only they could travel back in time. But Darren Lehane and Conleth Bradley SC are not Marty McFly and Doc Brown. Not even the finest minds in the Law Library can design a DeLorean," she said.
The committee will meet again on Tuesday to continue their negotiations but it is expected their final report will be delayed.
It was due to be sent to the Dáil on March 13th for a vote to take place the following week. This is likely to be postponed.
