Foster defends signing key RHI costs declaration

Arlene Foster
Arlene Foster

Arlene Foster has again defended her decision to sign a declaration about the RHI scheme which stated: “I am satisfied that the benefits justify the costs.”

On Monday the News Letter revealed that Mrs Foster had signed the declaration in an obscure document laid in the Assembly at the point where the non-domestic RHI scheme was put in place.

That document – the Regulatory Impact Assessment, contained within the explanatory memorandum to the RHI statutory rule – was signed on April 13 2012.

The statement was signed at the point where the cost controls in the GB legislation had been removed from the legislation which was to go through Stormont.

Mrs Foster has always said that she did not take the decision to strip out cost controls.

In the Assembly on Monday, DUP MLA Pam Cameron asked the first minister: “The ‘News Letter’ published a story this morning about the regulatory impact assessment. On what basis did the minister sign off on the regulatory impact assessment, and should it not have been apparent that there was a fatal flaw at the heart of the scheme?”

The first minister replied: “It is an important question, and I am glad that she has asked it.”

She went on: “In the regulatory impact assessment, the department recognised that setting incorrect support payment levels to the RHI tariff posed the most obvious risk to the Northern Ireland scheme.

“If the level was set too high, those installing renewable heat would be oversubsidised and less heat would be delivered per pound than would be under more optimal subsidy levels; alternatively, if the rate was set too low, renewable heat would not be deployed to the extent expected.

“In that document, it was made clear that there were to be regular planned reviews of subsidy levels after a number of years of experience with the subsidy.

“That would, of course, have provided the opportunity to amend tariffs if needed and ensure that they remained appropriate, given the potential changing market conditions.”

Mrs Foster highlighted that in the document it was proposed that the first review would begin in January 2014, with any changes needed to be made by April 1 2015.

She went on: “The review did not happen. Departmental officials did not carry out that review. As minister, I have the right to expect that risks identified in an RIA would be managed by officials.

“As the accounting officer has explained at length to the Public Accounts Committee, several important commitments were made at the time when the RHI was approved, not least on risk management, that were not followed through.

“Those omissions by officials contributed materially to the very serious problem we now face.”