Business

Invest NI owed millions in failed company deals, figures show

Invest NI's repayment invoices total almost £20 million and so far only £4.8m of these monies have been recovered

FAILED investments by Invest Northern Ireland has cost the region's economy the best part of £15 million, the Irish News can reveal.

The agency has ploughed taxpayers' cash into thousands of firms since it was set up more than a decade ago.

In the last five years, however, it has had to issue 197 notices to claw back nearly £20 million it pledged to firms which, for various reasons, haven't delivered on their jobs promises or who have simply collapsed.

But just £4.8 million of those repayment invoices have been recovered, leaving the taxpayer out of pocket by around £15 million, enough to buy a school or add a hospital wing or go towards starting the York Interchange project.

Here are a few other things that £15 million might buy in Northern Ireland over a year:

  • 3,821 students’ annual tuition fees at Queen's or Ulster University;
  • 207,000 jobseekers’ allowance claims of £72.40 for a week;
  • 537 nurses for a year on £27,901 each;
  • 64 apartments on Belfast's Malone Road (currently on sale at £235,000);
  •  Three snap Stormont elections at £5 million a go.

Figures requested by the Irish News reveal that more than 1,500 firms have had their payment claims rejected following administrative errors and failure to comply with the terms of their offers.

Invest NI issued 197 clawback notices to firms they'd given financial backing to. These notices are doled out if a company fails to deliver on the terms of their investment deals.

The repayment invoices totalled almost £20 million - but so far only £4.8m of these monies have been recovered.

In many cases, the businesses in question who were given financial assistance by Invest NI have gone into liquidation, leaving the prospect of recovering the funds all the more difficult.

Invest NI was set up over a decade ago as a non-departmental public body of Stormont’s enterprise department. It has invested in thousands of companies to the tune of hundred of millions of pounds, all funded by taxpayers' money.

You could buy more than 60 apartments on Belfast's Malone Road with the £15 million owed to Invest NI

When the body issues offers of assistance to firms seeking investment, they in return must submit expenditure claims in order to drawn down their funding.

In the last five years, a total of 1,528 clients had their claims rejected for various reasons.

These reasons include failure to provide enough documentary evidence for the claims, failure to comply with the terms of the agreement between Invest NI and the company, and administrative error in expenditure claims.

The lost £15 million could fund 3,821 student places

Since its inception, Invest NI has been responsible for hundreds of millions of pounds in funding and has provided assistance to thousands of clients across the north.

Over the years, a total of at least 22 companies who were offered financial assistance from Invest NI later either closed, ceased trading or relocated outside of Northern Ireland.

In their initial offers, these firms were offered nearly £65m combined.

On one notable occasion two years ago, United States healthcare company CVS Health shut its operations in Belfast after it received more than £500,000 in funding from Invest NI. A total of 70 jobs were lost in the process.

In December, Invest NI hit the headlines after it emerged it owned £1.2m in shares in a leading wood-pellet manufacturer Balcas.

Wood pellets are the fuel used by the more than 2,000 operators of boilers purchased under the controversial RHI scheme.

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