RHI scandal: DUP cite sources for claim parties wanted subsidy rise

Lee Reynolds
Lee Reynolds

The DUP has pointed to debate records to back up its claim that other parties had believed the subsidies paid out under RHI were “too low”.

Top DUP figure Lee Reynolds had unleashed a fiery counter-attack upon his opponents at a meeting of Belfast City Council on Tuesday, telling the chamber that those who are now criticising RHI “all knew” how it worked at the time, and that “the record shows they would’ve made the scheme worse, not any better”.

Asked by the News Letter what he was referring to, councillor Reynolds provided instances of MLAs having voiced concerns around the tariff rates at Stormont.

The UUP – one of the targets of councillor Reynolds’ counter-attack – last night dubbed it “desperate stuff”.

On Tuesday night councillor Reynolds (the DUP’s director of policy and group leader on the capital’s council) had said political rivals seemed intent upon conducting a “kangaroo court” into the debacle.

He went on to add: “Did any party say the tariff was too high? No they didn’t.

“Do you want the bad news for those who are now presenting themselves as the protectors of the public pocket?

“Sinn Fein, the SDLP, the UUP and Greens [had] all complained the tariff was too low.”

Asked to elaborate on Wednesday, councillor Reynolds highlighted specific examples of things said by MLAs from each of these parties in the Assembly.

One example he gave was of the UUP’s Adrian Cochrane-Watson – who was at the time a member of the enterprise committee in charge of scrutinising DETI – speaking on February 15 last year (after problems had begun to emerge publicly with RHI programme).

He had said: “A Fermanagh firm I’ve been talking to, and which plans to install biomass boilers, is saying that it is currently struggling to compete with other UK-based manufacturers.”

The UUP man then added that the tariff rate for the type of boiler he had in mind was “less than a third” that of its equivalent in mainland UK.

See this link for the Hansard record relating to this.

The Ulster Unionists said last night: “This is desperate stuff from a desperate DUP.

“They have been caught up in their own web of contradictory stories, can`t find a way out and have reverted to their old technique of trying to find someone else to blame to avoid taking responsibility themselves.

“We now know that in the background to the debate the DUP DETI minister and the DUP First Minister had had a blazing row about the closure of the RHI scheme. “Of course no-one participating in that February 2016 debate knew this – apart from the DUP and maybe Sinn Fein.”

The other examples picked out by councillor Reynolds were as follows.

He quoted the Green Party leader Steven Agnew – then a member of the enterprise committee – as saying in the Assembly on February 18, 2013, that the “renewable heat incentive in Northern Ireland is less generous than its equivalent in GB” and that this “concerns me”.

He added that “if we topped that [fund for the scheme] up, perhaps we could produce better incentives”.

See the Hansard for this here.

He also quoted Sinn Fein’s Phil Flanagan – also then a member of the enterprise committee – as saying (on March 13, 2012, before the scheme was up-and-running), that “I have concerns that the tariffs here are much lower than were previously announced for a similar scheme in Britain” (see the Hansard here).

And councillor Reynolds also quoted the SDLP’s Patsy McGlone – then the chairman of the enterprise committee – on October 22 of that year (a few weeks before the scheme had begun) as saying “concerns have been expressed that the tariffs for the renewable heat incentive are lower than those in Britain” (see the Hansard here).

When the MLAs refer to the tariff rate being lower in Northern Ireland than Great Britain, it is not clear exactly what tariff rates they are referring to.

The NI Audit Office’s explosive report into the details of how the RHI scheme worked, published in July 2016, showed that whenever the scheme first began in Northern Ireland the tariff rate was 5.9p per kw produced for non-domestic biomass boilers of less than 100kw (which were “by far” the most popular means of generating heat under RHI).

Meanwhile the same type of boiler yielded a subsidy of about 9p per kw produced in Great Britain.

However, there is a crucial difference between the rates of subsidy in Great Britain and Northern Ireland.

The 5.9p rate was the ONLY tariff available in Northern Ireland.

But in Great Britain the 9p tariff dropped sharply – down to less than 2.5p per kw – after a boiler had been left running for 15% of the year.

The existence of these two types of tariff in Great Britain (called tiering) was a crucial cost control which meant people could not simply make money by running boilers all day for no reason – but which had been removed from the Northern Ireland scheme at the outset.

It is possible that when the MLAs are referring to the tariff being higher in Great Britain than in Northern Ireland that they were referring to this initial 9p tariff covering 15% of the year.

Crucially, the Hansard records highlighted by councillor Reynolds do not appear to show that the MLAs understood that the cost of fuel was lower than the value of the subsidy.

This was one of the most critical problems with the scheme.

It meant it was inherently profitable to generate heat whether it was needed or not, and combined with the fact that there were no tiering cost controls, there was nothing to stop people making money for 100% of the year by running boilers all the time.

It was put to councillor Reynolds that the Hansard records he cited show perhaps that the MLAs did not understand the minutiae of how the scheme worked, such as the importance of tiering and the fact the fuel cost was lower than the subsidy value.

He said: “They’re attacking officials and ministers for not understanding the minutiae of the scheme.

“Patsy McGlone was chair of the committee. Steven Agnew sat on the committee for the entirety of the term...

“When this was presented, Patsy McGlone boasted about the level of scrutiny that these regulations had been put through by the committee... those were the regulations that did not include the tiering.”

He added: “The simply fact is there was a tariff. Nobody complained that it was too high, and in fact they made the reverse complaint.”