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Department​​ of Economy slammed over Covid spend

Auditor General says lessons have not been learned over RHI


Review: Kieran Donnelly, the Auditor General

Review: Kieran Donnelly, the Auditor General

Review: Kieran Donnelly, the Auditor General

The Northern Ireland Audit Office has slammed the Department for the Economy over “irregular” spending on Covid relief schemes.

The Auditor General Kieran Donnelly said he found elements that were “completely unacceptable” after examining the accounts for the Department and Invest NI.

He also said it was “extremely disappointing” that the Depa rtment did not appear to have learned lessons from the well documented failings of the Renewable Heating Incentive.

Mr Donnelly’s findings said the Department’s net expenditure had been £1.6bn in 2020/21, up significantly from £1.1bn in 2019/20.

Invest NI’s net expenditure also jumped to £422m, up from £38.6m in 2019/20.

The much higher figures followed on from a range of emergency relief schemes during the pandemic.

The audit report focused on four schemes which had a total cost of £140m — including grants for small businesses, retail and tourism.

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Although the payments were logged in Invest NI’s books, they were still controlled by the Department.

Mr Donnelly said Invest NI had been asked to include the payments in its accounts, as the agency had the legal powers to make the payments that the Department lacked.

The auditor said this should actually have been included in the Department’s accounts.

He added that expenditure taken on by the Department did not have the proper legal authority.

Mr Donnelly then qualified both sets of accounts as “irregular” and said that Invest NI’s financial statements did not show the full picture.

He said that the Department and Invest NI were provided with the chance to adjust their accounts but refused to do so.

While he accepted the pressure under which the schemes were delivered, he said the failings were about “fundamental principles and standards” of accounting .

"It is completely unacceptable that a department fails to comply with the requirements of primary legislation it is relying on to make payments," he said.

"This is a basic requirement, and it is extremely disappointing to see that the department has failed to learn lessons from its past failure on obtaining approvals required for the Renewable Heating Incentive scheme."

The Department for the Economy has since disputed Mr Donnelly’s claims.

A spokesperson said it and arms length bodies had responded to the Covid crisis immediately with 30 schemes costing £951m.

"These schemes helped tens of thousands of local businesses at a time when no-one knew what lay ahead. It is therefore disappointing, and not for the first time, that the department is forced to clarify its position following an NIAO report," they said.

"The department's accounts were presented to the NIAO in May 2021, as agreed. A delay arose because of the NIAO's interpretation of an accounting issue it had not raised the previous year when the same schemes were delivered.”

Despite gaining extensive legal advice, they said the department was “unable to persuade NIAO of its position”.

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