Energy scheme scandal rocks NI Executive

16 Dec 16

Northern Ireland’s first minister Arlene Foster is under fire following claims about the mismanagement of a scheme designed to promote the use of renewable energy.

The Renewable Heat Incentive scheme was set up by the Department of Enterprise, Trade and Investment in 2012 when Foster was the minister in charge. It offered generous subsidies to businesses and other non-domestic users if they shifted from fossil fuels to renewable sources of energy such as biomass boilers and thermal pumps.

However, due to the way the scheme was set up, costs were not capped and it went way over budget – potentially by up to £400m.

The RHI scheme came with a built-in perverse incentive as, the more fuel was used, the more cash claimants would receive from the government. According to whistleblowers, many subsidies were claimed for heating un-used buildings, such as empty sheds and previously unheated factories.

Almost 2,000 applicants are in receipt of RIH funding and applications had a 98% approval rate. Due to scheme rules, funding is guaranteed over 20 years, and more than £1bn in public money is due to be paid out over this period.

In a BBC interview this week, former enterprise minister Jonathan Bell, who is a member of Foster’s Democratic Unionist Party, spoke out about the scheme and the involvement of advisers close to Foster.

Bell alleges that he tried to close the scheme in September 2015, although civil servants first drew their concerns to his attention the previous June, but was blocked by DUP special advisers who pushed for a delay.

“The minister of the department was overruled by outside special advisers,” he told the BBC.

The scheme was finally closed in February this year.

Foster has said she when she was minister in charge she was not advised that the costs of the scheme needed to be controlled. She has also denied all knowledge that internal documents and communications were amended to conceal her involvement.

Bell is calling for a judge-led public inquiry to establish the truth of his allegations.

Other Northern Ireland parties are calling for Foster’s resignation. Colum Eastwood, leader of the SDLP, said in a statement on Wednesday: “In light of the first minister’s continued failure to answer the most serious questions about the biggest public finance scandal in the history of devolution, it’s clear that the matter has to be forced.

“The SDLP will table a motion of no confidence to exclude Arlene Foster as first minister while she continues to face these critical questions and until she has accounted for her conduct in relation to the Renewable Heat Incentive fiasco.”

Conor Murphy of Sinn Fein, which shares power with the DUP, also demanded an inquiry.

“There needs to be an independent investigation into this in which all information, including internal departmental papers, records, and email trails should be fully disclosed by all of those involved,” he said.

“We also need to know who benefited from this flawed scheme and who made the decisions surrounding its design, operation, and failure to monitor and slowest to close the scheme. 

“In addition there needs to be urgent action to reduce the impact of this debacle on our public finances and on our public services.”

Ulster Unionist Party leader Mike Nesbitt called Bell’s revelations “shocking” and suggested the entire DUP leadership had questions to answer.

A special sitting of the Northern Ireland Assembly will take place next week, where Foster will make a statement about the RHI scheme. The executive has said plans are being finalised to reduce losses stemming from the scheme.

  • Vivienne Russell

    Vivienne Russell is managing editor of Public Finance magazine and publicfinance.co.uk

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