Renewable Heat Incentive scandal 'biggest since devolution'
THE administration of a renewable energy subsidy overseen by Arlene Foster's former department has been described as "potentially the biggest scandal since devolution began".
The claim was made yesterday as Stormont's Public Accounts Committee (PAC) grilled officials from Ofgem, which jointly managed the Renewable Heat Incentive (RHI) scheme alongside the Department of Enterprise, Trade and Investment (Deti).
The PAC is probing the RHI, which was designed to encourage farmers and businesses to switch from fossil fuels, on the back of an audit office report earlier that showed widespread abuse of the scheme could cost Stormont more than £1bn over the next 20 years.
Finance Minister Máirtín Ó Muilleoir revealed last week that Deti's successor – the Department for the Economy – had projected a funding deficit of "circa £30m" this year due to overspend on the scheme.
The abuses were brought to the attention of the authorities by a whistleblower.
In one case highlighted by the auditor, a farmer hoped to claim £1m in subsidy over 20 years from the scheme for heating an empty shed.
In a PAC hearing that lasted more than four hours, the Ofgem officials faced criticism for their role in jointly overseeing the RHI scheme, which saw a huge surge in applications in 2015/16.
In the years after the scheme first opened in 2012 applications had been in the hundreds, however, ahead of it closing late last year there were more than 2,000 individual bids to avail of the subsidy.
The officials did not accept that they alone were responsible for the huge overspend, however, they conceded that key meetings between the energy regulator and Deti were not minuted.
Dr Edmund Ward from Ofgem told MLAs that risks associated with the lack of a cap were raised in its feasibility study in 2011.
His colleague Chris Poulton acknowledged some faults with the organisation's handling of the scheme, including a failure to keep records of meetings with Deti, but he stressed the scheme was ultimately shaped by the Stormont department.
"As administrators we don't set policy," he said.
The Ofgem officials said there were three cases of suspected fraud being probed. However, the PSNI has told The Irish News it is not conducting investigation into the scheme.
Dr Ward revealed that of 12 sites inspected in 2014-15, eleven of those had non compliance with the scheme's regulations.
SDLP MLA and PAC member Daniel McCrossan the RHI was "potentially the biggest scandal since devolution began"
He said it appeared then then enterprise minister Arlene Foster "created a lottery and gave everyone a winning ticket".
"After shockingly poor planning and obscene mismanagement, this scheme is set to cost the public purse more than £1billion over the next 20 years," he said.
"This is far in excess of the £30m annual Barnett payment allocated to us from the adoption of a similar scheme in Britain."
The West Tyrone representative accused the Ofgem officials of being "relaxed" in their oversight of this scheme.
"They didn’t take minutes of meetings or records of telephone calls and they inspected only 12 cases from thousands of applications, and found that 11 of these would become problematic – they have revealed themselves to be asleep at the wheel," he said.