Industry 'prematurely aware' of planned cuts to RHI scheme
The renewable heating industry was prematurely aware of planned cuts to a lucrative green energy scheme in Northern Ireland, a senior civil servant has said.
A spike in applications led to massive over-spending on the lucrative wood boiler incentive which was supposed to be funded solely by the Treasury.
Civil servants at the time did not realise how serious it was but the senior official in Stormont's Economy Department said there was evidence the industry was asking others in the "political class" to delay cost-saving measures.
Dr Andrew McCormick said influence was exerted from others in the DUP - he named a former adviser to the first minister but said he had no direct evidence of his identity - who wanted to keep the scheme open at the higher rate of payment.
Dr McCormick said: "The consequence is very serious because this shows that there was premature awareness of the potential for the tariff to be reduced and the message went within the sector - 'get in quick'."
Nationalist SDLP leader Colum Eastwood said: "His suggestion that insider information played a part in the Renewable Heat Incentive (RHI) catastrophe is a signal of a corruption in this scheme and a corruption of government that must be rooted out."
The "ash for cash" scandal led Stormont deputy first minister Martin McGuinness to resign from powersharing with the DUP in protest and forced the collapse of powersharing and fresh elections.
Recipients of the Renewable Heat Incentive (RHI) were receiving about £1.60 for every £1 spent on wood fuel.
The scheme has landed the public service in Northern Ireland with a potential £490 million bill over the next 20 years.
Civil servants wanted to cut the rate in July 2015 but objections were raised by a special adviser to then economy minister Jonathan Bell.
Dr McCormick said, with caveats, he believed through hearsay that influence was being exerted on Mr Bell's party adviser by Dr Andrew Crawford, who then worked for Arlene Foster.
He said he was making no suggestion Mrs Foster became involved in keeping the scheme open.
Mrs Foster set up the RHI while she was enterprise minister in 2012 but had moved on by summer 2015.
The tariff rate for payments was eventually reduced that November, but not before a massive surge in the number of applications.
Dr McCormick said because the RHI was originally supposed to be entirely funded separately by the Treasury, t here was a misconception that this would not have a cost to public spending in Northern Ireland.
He told Stormont's Public Accounts Committee (PAC): "Around the period of July there is evidence of some premature information being made available to the industry."
It was possible some of the pressure coming through others in the DUP via former economy minister Mr Bell's special adviser was because "the industry was saying to others in the political class that we hear something is about to happen, can you do something about it a nd can you give us longer?
"That is purely inference, I have no evidence for that, it just seems a not unreasonable inference that that might have happened."
He said the decision to delay a reduction in the tariff and the influence of Mr Bell's adviser Timothy Cairns created the conditions for the overspend, the "perfect storm".
Dr McCormick said the opportunity was there and it was understood to at least a degree by the industry why it was worthwhile getting involved.
He admitted officials were "blind" to the consequences.
He said documents had appeared with him anonymously after Christmas which required further investigation. And he said a meeting involving former minister Mr Bell was recorded without his knowledge.
Dr Crawford said: "As someone who worked in DETI for many years I spoke to the then Department of Enterprise, Trade and Investment special adviser at that time about the RHI scheme.
"Any discussions with the DETI SPAD during the summer of 2015 would have been on the basis of my experience of the department.
"In discussing the matter with the DETI SPAD I would have been offering informal advice and assistance as a colleague to my successor in the department and not on behalf of the Finance Minister or the party.
"However, as I pointed out to the BBC in December I did not attempt to keep the RHI scheme open at the original tariff against the wishes of the minister.
"Indeed, I specifically stated on 31 July 2015 that the department, 'will need to make changes from 1st October'."