Belfast Telegraph

RHI cuts costing jobs and will lead to bankruptcies, warns boiler owner

By Jonny Bell

New caps to curb the multi-million pound 'cash for ash' overspend are already causing job losses, a businessman has claimed.

On Saturday, the Department of Economy introduced new rules capping payments from the scheme.

Now one Fermanagh man, who runs a timber business, said he has been forced to take the tough decision to lay off six staff.

Another 18 employees are working a four-day week on reduced hours and up to nine may be made redundant next week.

"We invested £1.2m in the Renewable Heat Incentive and that is all borrowed money, commitments we can't walk away from," he told the Belfast Telegraph.

"If Stormont's original intention was to give business a boost through the scheme, they are now crippling us and some will end up bankrupt.

"Renewable heat is now a swear word in our parts."

Initially, there were no tariff restrictions - meaning businesses could profit hugely from the scheme. Moves are now under way to reduce the projected £490m overspend.

The Renewable Heat Association Northern Ireland (RHANI) - which represents businesses that took advantage of the green energy grants - said those affected were not informed of the change.

It has been preparing for a legal battle to force the government to honour its original commitments under the scheme for its 20-year lifespan.

The association says a number of businesses have had to lay off people - and some may have to close.

A spokeswoman for RHANI said: "Sectors including agriculture, which traditionally operate on a very low-profit margin, are badly affected by these changes and it appears that a number of businesses cannot now service bank loans they took out to buy the boilers required for this government-promoted scheme."

The Fermanagh businessman said he hoped fraud inspections would have been done by now in order to clear his business of wrongdoing.

"We had been watching developments, but thought they would give us at least a three-month run-in," he added.

"Had the scheme been originally set out as they want it now, we would be in a much better position.

"The RHI scheme allowed us to grow and their mismanagement has put all that in jeopardy.

"It was guaranteed for 20 years by the Government, if it was a private scheme you could maybe see a risk, we were told it would be 'grandfathered'."

This means that the support level for projects would be guaranteed over its lifetime, regardless of future reviews.

"I can't understand how it is legal for them to just take it all away after all their promises," the businessman said.

"We are using the heat in the most efficient way possible and yet we are having to lay off good people, fantastic staff who have worked hard for us for over 20 years and there is no consequence for those that set this up."

Auditors found serious flaws in the scheme from the beginning which resulted in businesses being paid £1.60 for every £1 they spent on the scheme.

One farm was found to be heating an empty barn shed with the windows open. However, most of those claiming from the scheme say they are doing so as it was intended.

DUP leader Arlene Foster, who set up the scheme when she was Enterprise Minister, has vowed to cut the overspend to zero.

Alliance's Stephen Farry added: "The lack of clarity around the RHI scheme has been its undoing from the start.

"If the department is making changes to the terms and conditions of the scheme, those affected should be properly notified. It is not acceptable to simply list the amendments on a website.

"Without doing so in an acceptable way, the department is increasing the likelihood of receiving a legal challenge from claimants."

The department has said it is in the process of writing to each of the RHI claimants.

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