The State will not be looking to recoup the €100 water conservation grant
The Taoiseach says services will not have to be cut for the Government to afford to pay back water charges.
It was confirmed over the weekend that refunds will be issued in the autumn, with plans for the money to be repaid before the end of the year.
Customers who paid all their Irish Water bills will receive refunds of between €200 and €325.
The total cost of repayments is expected to be around €170 million
The Government is largely looking to fund it through underspends in other departments.
Taoiseach Leo Varadkar, meanwhile, says it should not affect any public services.
He explained: "For a one-off spend, we can find money such as this. For recurring spends, it's very difficult because you need to find the money every year.
"We're very confident that we'll be able to find this within existing resources - without any impact on services, without any new taxes, and without any effect on the Christmas bonus which will of course still be paid this year."
Mr Varadkar also confirmed that the State will not be looking to reclaim the €100 water conservation grant from households.
He noted there could be 'some complications' in refunds to people who have moved house, left the country or passed away - but stressed most people will receive the money before the end of 2017.
Water charges have now been suspended for more than a year, with the Dáil having effectively abolished the controversial household charging regime.