Читать книгу Burned - Sam McBride - Страница 14

CHAPTER 5

LICENCE TO BILL

On 13 April 2012, Arlene Foster did something which defied rational explanation: she signed what was close to a blank cheque. Of course, ministers do not literally sign cheques, blank or otherwise, and government payments are handled by officials far beneath them. But the document to which Foster put her name consented to the idea that setting up an RHI scheme was value for money without knowing how much it would cost. Even if she had no other direct role in the RHI scandal, Foster’s signature that day undermined her boast of being someone who was forensic with detail and by implication could be trusted to handle the complex business of government.

Known as a regulatory impact assessment, the document was part of the democratic checks and balances within the world of government. The bureaucratic title belied its intent: this was a piece of paper meant to be a protection for the minister – and, by extension, the public – ensuring that their express consent was required before an expensive policy could get to an advanced stage. Fiona Hepper sent the document to Foster and Crawford alongside a submission recommending that she sign it. By doing so, Hepper said, she was signing to ‘approve the final NI RHI’ policy and to confirm that she was content for the scheme to proceed. Foster took her official’s advice and signed a declaration which said: ‘I have read the Regulatory Impact Assessment and I am satisfied that the benefits justify the costs.’ There was one problem: the document did not set out the scheme’s costs. Hepper had simply referred to the £25 million available for the first four years of the 20-year scheme. Primary school arithmetic would have established that a scheme, which cost £25 million for the first four years but ran for 20 years in total, was going to cost far more than £25 million. But it was the figure for the first four years which only really seemed to exercise the department. It was the only figure put in the submission – a form of short-termism driven by the fact that budgets were allocated on a short-term basis and that commitments over a period of 20 years were almost incomprehensible. Whether it factored in the officials’ thinking or not, it was also the case that whatever happened in 10 or 20 years’ time they would almost certainly have long gone.

During probing exchanges at the public inquiry, Foster and Crawford faced ferocious scrutiny of that decision. The inquiry’s technical assessor, Dr Keith MacLean, asked Crawford if there was any point in the officials’ going to the minister ‘if all you’re going to do is tick a box’ to say that if the civil servants were happy with it, then the minister was happy. Crawford candidly admitted that Foster’s signature had been little more than a ‘box-ticking exercise’. In withering comments which implied that Crawford had failed the minister, MacLean – who had worked at the top of the UK energy industry – said: ‘She was also relying on you to give her the advice. I just find it inconceivable in my career that I would ever have put a paper to somebody to sign that they were saying that the costs are justified without having those costs.’ Crawford replied tamely: ‘Well, unfortunately, it was signed off, and I didn’t flag it up at the time.’ When asked if he had considered how much the department was committing itself to in total, Crawford said that he did not think that he had considered a figure for the total cost of the scheme, although he was aware that it was more than the £25 million in the documentation. It wasn’t even the first time that Foster had signed what MacLean referred to as a ‘blank cheque’ for RHI. Earlier in the process, she had signed another document, which stated that the scheme represented good value for taxpayers – yet without any figure for how much it would cost over its lifetime.

When Foster appeared at the inquiry two days after Crawford, senior counsel to the inquiry David Scoffield QC pressed her: ‘But when you’re signing the declaration, which says that you’re satisfied that the benefits justify the costs, you’re putting your signature to that – should you not have thought to yourself, “I need to understand what the costs are?”’ Foster replied: ‘But I did; at that time, I understood that the costs were £25m and the tail [the remainder of the 20 years] was going to be paid so there was no issue for me in terms of was this [money] going to come.’ Perceptively, MacLean jumped in to ask: ‘Is what you’re saying there that whatever the extra cost was, it was going to be covered by the Treasury [so] it didn’t matter?’ Foster responded: ‘Well, it’s not that it didn’t matter; it’s just that we had had the assurance … that [it] was going to be covered by Treasury.’

Foster challenged MacLean’s suggestion that she had signed a blank cheque, arguing that she was aware of the £25 million cost over its first four years. MacLean said: ‘Let’s be generous then, and say it was a cheque for £25 million and not an indeterminate figure; it was not a cheque with the bottom right hand corner number of £445 million which at that time was the best estimate of what that cost was going to be.’ Foster said: ‘I go back to the point that I made in relation to the tail – that we had been assured that this was happening in GB, that it would happen here in a similar fashion.’ MacLean highlighted that ‘the fact that it’s covered doesn’t mean that it’s good value’. He highlighted that Foster was being given ‘precision and detail’ about relatively small figures for the administration costs of the scheme – one figure mentioned was £136,000 – ‘yet not about the total cost’.

But that wasn’t the only problem for Foster at that point. In the submission, which asked her to sign the ‘blank cheque’, Foster was given more misleading information. In a prominent table, the submission set out the proposed tariffs for Stormont’s scheme and the equivalent situation in GB. From that it was obvious that GB had tiering – but tiering was absent from DETI’s proposals. In a small-print footnote on that page, Hepper explained that tiering was used to ensure that a boiler was not ‘over-used just to receive an incentive’. But she copied the consultants’ erroneous claim that ‘tiering is not included in the NI scheme because in each instance the subsidy rate is lower than the incremental fuel cost’.

The scale of the scheme would have been obvious to the minister. She was told that the plan was to keep the scheme open until 2020 but that the last payments would not be made until 2040. Foster was being asked to commit her successors to potentially huge spending on this policy – and spending out of which they would find it exceptionally difficult to wriggle because she was told that tariffs were being ‘grandfathered’. That legal term signified that they were locked in and effectively exempt from a future government rethink where they could be slashed. She was given some comfort that there would be ‘scheduled reviews built-in … to allow DETI to ensure that the scheme remains fit for purpose and value for money for the duration.’ However, the officials’ errors were not picked up by the minister or her adviser – and the apparent view of the ‘box-ticking’ nature of the process does not suggest that she deeply pondered the extent to which the officials’ claims about value for money could possibly be right. That now undermines one of her later boasts. In October 2016 – just over a month before cash for ash would become a vast public scandal and imperil her career – Foster wrote an article for the Slugger O’Toole political blog. It began: ‘Detail is important. For someone from a legal background like myself this is a given.’ The article, which also claimed that the DUP had helped to secure a ‘durable’ system of devolution, now seems like Foster’s point of peak hubris. Despite knowing how she had operated as a Stormont minister, she wrote: ‘Our ascent to the natural party of government doesn’t mean overseeing the paper shuffling’.

Foster would later attempt to blame her civil servants for the entirety of the RHI disaster and not accept that she had made any errors which could have been seen at the time.

But whatever Foster’s failings, it is clear that she was failed by her officials. Hepper’s March 2012 submission, seeking approval for the scheme to proceed, told Foster that ‘under RHI only “useful heat” is deemed eligible; this is defined as heat that would otherwise be met by fossil fuels’. The submission – on the cover of which Foster wrote by hand ‘content’ – added: ‘This excludes deliberately wasting or dumping heat with the sole purpose of claiming incentive payments.’

Missing the ‘blank cheque’ wasn’t the only occasion on which Crawford failed to spot bear pits for his minister. Despite the handpicked spad being paid around £80,000 in the expectation that he would be digging through detail to protect his minister, Crawford admitted that he had not read either of the two CEPA reports for which DETI had paid £100,000 and which formed the basis of the scheme. The spad denied even having been sent the second report – CEPA’s addendum. If that is the case, he did not insist on seeing it. Foster said she believed that Crawford was reading at least the executive summary of reports, such as CEPA’s, but seemed reluctant to criticise the man who had been at her side for most of her ministerial career. When Crawford was asked if he had let the minister down by not reading the reports, he said:

Look, I let; I believe I let; I’m very sorry that I didn’t read it in detail to flag this up … I do not think that there was an expectation there that I should be analysing technical reports and bringing things to her attention which are at odds of [sic] the submission that she is signing. However, look – it is a regret of mine that I didn’t identify this and flag it up.

***********

But although it might seem that Crawford was neglecting to scrutinise the scheme, there is other evidence of him taking an interest in RHI in this early period. The full picture of how Foster’s spad – who is perhaps the single most significant figure in the entire RHI story – acted in this period is complex. To understand Crawford’s significance to this story, it is necessary to understand the immense power wielded by spads within the devolved Executive. Personal appointees of their ministers, spads were handpicked outside employment law and given generous salaries far above those of MLAs and sometimes higher even than those of ministers.

Some spads were exceptionally capable and some of them were widely respected for their abilities to oil the wheels of power, sitting between ministers and mandarins. But the Stormont system saw spads become more and more powerful, while lacking the constraints of accountability to which ministers – at least on paper – were subject. And Stormont was awash with them. The Office of the First Minister and deputy First Minister alone had eight spads: four for the DUP and four for Sinn Féin. That department fought a long and determined rear-guard action in an attempt not to reveal how much its eight spads were paid (up to £92,000, it later admitted). Salaries for many of the spad roles had more than doubled since devolved government returned to Northern Ireland after the 1998 Good Friday Agreement, and by 2015 a total of 19 spads were costing taxpayers almost £2 million a year. There was a sense at Stormont that spads were attractive to ministers because they could act in ways which carried the implied authority of the minister while allowing the minister plausible deniability if their actions became politically problematic.

In an interview for this book, Alan Clarke, who was the longest-serving chief executive of the Northern Ireland Tourist Board, said that he always viewed Crawford and Foster as inseparable. Clarke, whose role saw him ultimately reporting to Foster because the tourist board was under her department, said that Crawford ‘almost became quasi-permanent secretary [the most senior departmental official] of the department in terms of what you might say are difficult things: Irish language, difficult grant applications, whatever else’. He said that senior civil servants had made clear to him that ‘you cannot put a line between him and Arlene – they speak with one voice’.

Crawford told the inquiry that ‘from the very start of the RHI I was aware of budgetary implications’ and was asking questions about how the scheme was being funded and where the money was coming from. Significantly, the powerful young DUP adviser also told the inquiry that ‘I always likened the RHI scheme to the NIRO … That was always my view when the RHI was being set up and through the various iterations or the various papers coming forward: that there was a parallel in the two schemes moving forward’.

The NIRO (Northern Ireland Renewables Obligation) was being overseen by the same Stormont department and the way in which it was set up was lucrative for Northern Ireland. It was close to ‘free money’ in that the money for the scheme – much of which funded wind turbines – came from the public across the UK in the form of a charge on their energy bills. However, it was set up in a way that was doubly beneficial to Northern Ireland. Firstly, the amount, which the Northern Ireland public had added to their bills, was less than elsewhere in the UK. And secondly, the subsidy paid to developers was higher in Northern Ireland. That led to an explosion of wind farms across Northern Ireland – some of which had significant political connections – and pulled huge sums across the Irish Sea, far beyond the 3% share of the UK pot, which Northern Ireland would have received on a basic pro-rata share.

If Crawford’s understanding of RHI was, as he said, always viewed through the prism of the NIRO, and if he was being constantly told that RHI was being fully paid for by the Treasury, which he was, then it is easy to see how he would have come to the view that Stormont could spend as much as it wanted on RHI without consequences. In effect, RHI could be a backdoor addition to the block grant, particularly benefiting the rural community in which the DUP had a significant support base and especially agriculture, with which Crawford had long-standing high-level ties.

Foster told the inquiry that with NIRO some people viewed it as a good thing that Northern Ireland was getting more than its proportionate share of the UK budget. She said: ‘We were aware that NIRO was being funded and there wasn’t any difficulty if Northern Ireland went over its share as it were. And in fact for some people it would be seen as a good thing because we were taking more out of the pot as it were and bringing it into the Northern Ireland economy.’ Then, referring to how RHI was set up, she went on:

But if I had known there was a DEL consequence [Stormont might have to pay some of the bill], I would have been alerting the Executive to that … I think if I had known that it was AME with a DEL consequence, then I’d have had more of an alarm bell ringing as to degression [a cost control] and things like that.

However, when pressed about the implications of that logic, she insisted that although Stormont wanted to get as much Treasury money as possible into Northern Ireland it would never have deliberately chosen an expensive scheme, which was poor value for money in order to do so.

***********

Having engaged two firms of consultants and a specialist lawyer to make up for the lack of expertise within DETI as it tried to design its scheme, Hepper turned to a fourth outside body for advice. But, as with the previous three sets of advisers, DETI would not be happy with some of the feedback and would simply ignore some of it.

There was no tendering in August 2011 before DETI decided that it would appoint the GB energy regulator Ofgem – a section of which ran schemes on behalf of Whitehall departments – to explore how RHI might operate. In what the civil service described as a ‘Direct Award Contract’, no one else was able to bid for the work. Hepper justified the request – which was approved by Foster – by arguing that the way in which Westminster legislation had been drafted meant that Ofgem had to administer the scheme because it was described in law as ‘the authority’ responsible for the GB scheme. Her submission to Foster described Ofgem as ‘experts in the design of the scheme’ and added: ‘In addition, Ofgem legal advisors and development staff will carry out one full review of the draft regulations, and will advise DETI on Ofgem’s ability to implement the regulations as drafted, what changes may be needed to enable us to implement them in practice, and what changes may be required to streamline or improve implementation.’ But, having told the minister that one of the terms for Ofgem getting the contract was that it was to undertake to give expert advice on how to best set up the scheme, DETI would go on to consciously ignore explicit warnings which it was paying Ofgem to give.

The scheme was to be set up under regulations, a form of secondary legislation, which would receive less scrutiny in the Assembly than primary legislation. After awarding the contract to Ofgem, the regulations – which the department had drafted after rejecting the work of Bissett – were sent to Ofgem’s lawyers for line-by-line scrutiny. The response came back to Hutchinson and Joanne McCutcheon – two key staff working under Hepper to design the scheme – on 7 November 2011 and it was brutal.

The 26-page memo, which was drawn up by an Ofgem lawyer, set out ‘a considerable number of concerns’ with the regulations and said ‘it is critical that these concerns are addressed by DETI’. Many of the problems had already been highlighted in relation to the GB legislation on which Stormont was basing its scheme, and DECC, the Whitehall department responsible, was working on amending it. Ofgem suggested that DETI could either wait until the GB scheme was amended and change its scheme, or it could choose to ‘be proactive in addressing the issues’. Ofgem highlighted problems with preventing heat being used just to make money from RHI and warned about the potential for installing multiple small boilers to milk the most lucrative subsidy rate, rather than a single large boiler, which may otherwise be more logical. It also raised the potential for ‘parasitic’ burning of wood – where a boiler existed solely to dry wood, which was then fed into the boiler which dried more wood to be fed to the boiler and so on – simply to claim subsidy. It warned about the difficulties of deciding how to deal with domestic houses being heated under a non-domestic RHI. The document also explained that the regulations were so loosely drafted that ‘perverse’ outcomes could be lawful. Every one of those areas would become problems for Stormont’s scheme. But DETI decided to press ahead with its scheme largely unchanged, with the explanation that it would later follow whatever happened in GB.

Ofgem did not give up, coming back again and again to warn DETI that there were serious problems with what it was doing. In June 2012 – five months before the scheme would be launched – Ofgem suggested to Hutchinson and McCutcheon that they should speak to Whitehall about the changes being made in the GB scheme. Ofgem even passed on details of a contact who could explain the situation. Years later, Hutchinson spent five days giving evidence to the public inquiry but McCutcheon, his immediate boss, was the only major figure directly involved in the scheme not to give evidence at all, for reasons not made public at the inquiry. In May 2012, as it seemed that DETI was determined to press ahead with legislation, which it had been told was profoundly deficient, Ofgem lawyer Marcus Porter emailed a colleague to express alarm at what was unfolding. He concluded by observing that ‘taking the easy course now may well lead to problems later’.

Porter, a former flight lieutenant in the RAF’s legal branch who in that role undertook courts martial, was so alarmed at what DETI was doing that on several occasions he recorded in writing to Ofgem colleagues that the body should consider refusing to take on the administration of the scheme until DETI agreed to address the deficiencies.

In June 2012, a further Ofgem legal review of the regulations reminded DETI of the GB cost controls. That same month a crucial teleconference took place involving six Ofgem staff and two DETI officials – Hutchinson and McCutcheon. Ofgem emphasised again the problem of DETI pressing ahead with implementing a scheme known to have multiple deficiencies. But minutes of the meeting show that DETI said it was their intention to do so and then alter it the following summer. Ofgem’s minutes recorded:

Ofgem’s advice was to wait until the GB regulations are amended as the amendments will serve to negate any risk that the regulations currently pose. However, DETI were clear that they have a commitment with their minister to bring the regulations into force by the end of September … It was also felt that to do otherwise would also put financial arrangements in jeopardy.

Porter, the experienced Ofgem lawyer who was on the call, later told the inquiry that the concerns he raised at that meeting ‘seemingly made no impression on DETI’. He was dismayed.

The officials, who were already behind schedule on getting the scheme launched, appear to have believed that they could not delay any further. Hepper said that the timetable for launching RHI had been set by Foster. Foster accepted that she had told the officials to get the scheme launched ‘as soon as possible’ but said the ‘as possible’ was crucial in that context and added: ‘I certainly don’t have any recollection of saying “This has to happen by September.”’

The impression of officials feeling under ministerial pressure to move rapidly is reinforced by an email sent just minutes after the June 2012 meeting by senior Ofgem manager Luis Castro. Castro, who had been present, said to a colleague that DETI officials had told them that ‘NI ministers want the scheme to go ahead as soon as possible … and will not wait for amended GB regs’. Ofgem manager Keith Avis, who chaired the teleconference, was ‘nervous’ about the minutes of the meeting containing criticism of the GB regulations, something which would be implicitly critical of DECC, a major client of Ofgem. But Porter felt strongly that the minutes should reflect what had been said. Two days later, after being shown draft minutes, which did not fully convey what had gone on, he emailed Avis to ask for the minutes to be changed. After Avis expressed reluctance to do so, Porter said: ‘I think it important that there is an official record that, at our first “meeting” with DETI we hammered home the fact that we had significant concerns regarding the course they are proposing to adopt.’

The following day Castro emailed to back up what Porter was saying: ‘I think that what is important is that we capture the fact that our clear recommendation to DETI was to wait until regs are amended due to the risk the current ones pose.’ Hutchinson – the only DETI official on the conference call who gave evidence to the inquiry – did not dispute that Porter had made clear the risks of pressing ahead. However, he suggested that once it was made clear that DETI intended to do so the Ofgem figures accepted that and moved on to discuss other issues. It was a hugely significant moment. Months earlier, DECC had decided that tiering on the GB scheme was insufficient to protect public money, and moved to urgently implement an interim cost-control measure ahead of a longer-term sophisticated system to prevent an overspend. DETI, meanwhile, was moving in the opposite direction – stripping out the limited cost control of tiering and making no concrete plans to implement the changes happening in London.

The absence of tiered tariffs concerned many of those who viewed DETI’s proposals. Ofgem’s Oliver Moore noted internally in July 2012 that the increased biomass tariffs had jumped out at him, as well as the fact that there was no tiering. He highlighted that tiering had proved a good way of reducing the incentive to waste heat, adding pointedly that ‘taking it out increases the likelihood of abuse and heat wastage’. But, determined to get RHI launched soon, DETI’s mind was made up.

The inquiry heard illuminating evidence from two Ofgem figures who worked closely with DETI officials in the design of the scheme. Both of them separately said that they believed the civil servants were under pressure from someone higher up in Foster’s department to get the scheme opened quickly even though they knew it was flawed. Both Catherine McArthur, a former senior policy adviser to the Energy Minister in New South Wales, and Keith Avis were clear that the urgency did not originate with the officials they dealt with. When asked for her sense of where the time pressure was coming from, McArthur said:

My sense, having worked with [DETI officials] Peter and Joanne, is that there was somebody – a layer removed perhaps from them; I don’t know how many layers removed – who was putting on the time pressure and was making the decisions. It seemed that they were unable to give guidance or a steer of any kind which to me suggested that they didn’t have a great deal of control necessarily and that it was in somebody else’s hands.

Avis had a similar sense:

My overall view is that it [the time pressure] was coming from high, high up in the organisation – that it really was something that they were very much committed to and if, throughout this process, you mentioned about timing or any sort of delay it was very much ‘we hear what you’re saying; however we have got a commitment to push forwards’. I think there were stages where there was direction right at the top, at ministerial level, where there was a need to move forward quickly.

That impression is clear from a contemporaneous email from Ofgem’s Matthew Harnack to colleagues in August 2012. Relaying a phone conversation with Hepper, he said: ‘They noted that the minister is adamant that the scheme must go live in October, and I had to give them an assurance that there is no risk to this happening …’ Foster told the inquiry that if officials took her desire for haste to mean that they should press ahead with a defective scheme, they were wrong and they did so without ever properly informing her.

The final point at which it is alleged there was still a chance for DETI to pull back from the brink towards which it was rushing came just days after the June 2012 teleconference call with Ofgem. Hepper, who said that those on the call had fed the Ofgem warning through to her, insists that she spoke to her superior, David Thomson, and then to Foster herself. Thomson said that he recalled Hepper having brought the issue to him and that at that point she was going to bring the issue to Foster for a decision. But that critical conversation is now disputed – and with no written record of what actually transpired, it is Hepper’s word against Foster’s. Hepper told the inquiry that she had a ‘clear recollection of the conversation with the minister’ about the warning and that ‘I don’t believe that this was downplayed in any way’.

When asked if the minister was told specifically that Ofgem’s recommendation was not to proceed without cost controls, she said: ‘Yes, and I did not downplay that; I said that’s the advice from their lawyers.’ Hepper admitted that there had been no formal written ministerial submission on the issue, and accepted that with hindsight that ought to have happened but blamed time pressure for not having done so.

The DUP is a party which is exceptionally precise in its use of language – even when lawyers are not involved. For that reason, Foster’s evidence to the inquiry on this point was striking for what it did not say. In her written evidence to the inquiry – evidence which would have been carefully put together – Foster, who by then was DUP leader, said: ‘I have no recollection of being clearly informed about the risks of proceeding without cost controls.’ Because of what it does not say, the comment leaves open the possibility that Foster was informed clearly but has forgotten it, or even if that was not the case that she was informed in some way of Ofgem’s warning – but not in explicit terms. Whatever happened in that conversation – if, as seems to be the case, it took place – nothing was done to halt the launch of a scheme which many, if not all, of those launching it had been told was seriously flawed.

***********

The die had now been cast and only the formalities – and at Stormont they often tended to be formalities – of passing the legislation through the Assembly chamber stood between the hapless scheme being opened to those who would enrich themselves from it. On 18 October the scheme was brought before the Enterprise, Trade and Investment Committee – the cross-party Assembly committee which scrutinised Foster’s department – and sailed through without its fundamental flaws being spotted. The minutes of that meeting indicate little of what transpired, but it would later be claimed that, as with the minister, the committee was not given the full picture by officials.

Four days later, the regulations came before the entire Assembly where any one of the 108 MLAs had the chance to question what was happening. In a brief 460-word speech, Foster gave little of the key detail about how the scheme would operate. But she did talk about ‘my department’, ‘my commitment to the sector’ and ‘my desire to see levels of renewable heating increase’. Her comments were typical of how many Stormont ministers – but particularly Foster – liked to operate. The minister was eager to be associated with a scheme, which she thought would be politically popular, rather than modestly pointing out – as she would later claim – that most of the significant work was done by her officials.

Speaking on behalf of the scrutiny committee, Patsy McGlone, its Social Democratic and Labour Party (SDLP) chairman, welcomed the scheme but said that ‘some concerns have been expressed that the tariffs for the renewable heat incentive are lower than those in Britain’. He claimed that the committee’s scrutiny of the proposal had been ‘considerable and reflects the importance and long-term nature of the proposals’. And he went on to pledge that the committee ‘will pay particular attention to the reviews, and it will scrutinise the implementation of the scheme’, something it would fail to do.

However, although those comments turned out to be an embarrassing overstatement of the committee’s largely acquiescent role in the process, McGlone did raise the fact that the green energy charity Action Renewables had expressed concerns that the ‘rates and bands for biomass could create a distortion in the market and lead to applicants installing boilers with a smaller than required capacity’. McGlone’s support for Foster’s scheme was surpassed by one of the DUP members of his committee, who was positively gushing about RHI. Robin Newton, who would go on to become a highly controversial Speaker of the Assembly, told the chamber that it was ‘a good news story’ in ‘an area where, I believe, we are often maligned, and I do not believe that that maligning is justified’. In remarks which are now excruciating to read, Newton said: ‘This project is leading us down a road, and I believe that, when we reach the final stage, the economy of Northern Ireland will have benefited significantly from the steps that the minister has taken.’

Sandra Overend for the Ulster Unionist Party referred to CEPA’s report – sections of which were dangerous garbage and with tables where the numbers did not add up – and enthused that it had ‘undoubtedly been invaluable in informing decision-makers on the best way forward’. The only other speakers in what could not accurately be described as a debate were Alliance MLA Chris Lyttle, Green MLA Steven Agnew and Sinn Féin’s Phil Flanagan, each of whom also welcomed the scheme. Without a single dissenting voice, The Renewable Heat Incentive Scheme Regulations (Northern Ireland) 2012 passed their final legislative hurdle and became law. But there was a remarkable fact which went unrealised by everyone in the Assembly chamber that day: Foster had not even read the legislation which she was asking MLAs to vote into law. The minister made the admission almost six years later when being grilled by the public inquiry. In a revelation which left some of her DUP colleagues slack-jawed in disbelief, Foster casually said that she had ‘definitely not’ read the regulations.

Under questioning about a deficiency in the regulations whereby they did not adequately define ‘useful heat’ eligible for subsidy, making it more difficult to crack down on potentially fraudulent claims, Foster said that she ‘imagined it would have been defined in the legislation’. When asked if she had at any stage read the regulations, Mrs Foster said: ‘No. No, I didn’t. So there’s … absolutely not. I didn’t read the regulations.’ David Scoffield QC for the inquiry asked Foster if she would have read the regulations when she brought them to the Assembly for approval. She said: ‘No, I don’t believe I would have read them at that stage. I probably would have only read the explanatory note, but not the regulations involved.’

The clarity of Foster’s recollection about not reading the legislation was striking because that day at the inquiry she had repeatedly used phrases such as ‘I don’t remember’, ‘I can’t recall’ and ‘I don’t think I have any clear recollection’ about key meetings from 2012 which went unrecorded. The tone with which she spoke and her body language conveyed no embarrassment at the admission that as a government minister she had not read a piece of legislation tabled in her name and which she was asking MLAs to endorse.

***********

Given the centrality of Crawford to this story, there is an intriguing footnote about this period. Before joining the DUP staff team in 2004, Crawford had worked for two years as a policy officer for the Ulster Farmers’ Union (UFU).

His time at the UFU – a body with major political clout in Northern Ireland – coincided with the two-year tenure of a Londonderry farmer, John Gilliland, who had been elected as the union’s youngest-ever president at the age of 36. Gilliland was a green energy pioneer who specialised in biomass, running boilers on his farm long before RHI and growing willow, which was turned into wood chip to be burned in biomass heating systems. He was no stranger to politicians, having stood as a unique independent candidate in the 2004 European elections with the backing of the Alliance Party, the Workers’ Party and a rainbow coalition of other smaller parties. Foster told the inquiry that she knew that Crawford and Gilliland ‘would have known each other for quite some time’.

In spring 2011, Gilliand wrote to Foster about his ‘favourite bug bear, a Northern Ireland Renewable Heat Incentive’. He relayed how David Dobbin, the chief executive of major Northern Ireland milk processor, Dale Farm, had said that the delay in launching RHI ‘was severely undermining the Northern Ireland dairy industry’s competitiveness against his GB competitors’. The correspondence shows that Foster was being personally contacted about RHI and therefore presumably was asking internal questions about it in order to be able to respond. Gilliland met Foster and Crawford at DETI’s Belfast headquarters in August 2011 to discuss RHI. Without a minute of the meeting, it is unclear what exactly was said. But it is clear that Gilliland was pushing the minister to get the scheme launched.

Although a committed environmentalist, Gilliland had more pressing personal reasons to secure the subsidy. In 1996 he had set up Rural Generation Limited, a research and development company exploring uses for wood chip, and the company had gone on to sell biomass boilers. In 2009, the firm had installed a biomass boiler at Stormont Castle.

But as the long-delayed RHI remained uncertain, the firm struggled to stay afloat and cashflow dried up in late 2012. On 2 November the company was wound up. Gilliland was interviewed by the Irish Farmers Journal and that day the journalist contacted DETI to ask for a comment from Foster. None arrived. However, he was advised to look for a public statement from the minister the next day. On the morning of 3 November, Foster announced that Stormont’s RHI scheme was finally opening. Crawford phoned Gilliland that night and commiserated with him over the demise of Rural Generation Ltd. Gilliland later recalled that the spad had ‘encouraged me to get back up on my feet and said pioneers such as myself would be required to deliver this new policy on renewable heat’. What the public did not know was that even though Foster was inviting applications to her shiny new scheme, there was no one to accept those applications. In DETI’s haste to open RHI, it had done so before finalising terms with Ofgem to administer the scheme. Hepper told the inquiry that the department had a ‘line in the sand’ date for launch and was determined to do so. The small matter of not having anyone to run the scheme was not going to stand in DETI’s way.

DETI was now in a weak position to negotiate Ofgem’s fees. A huge increase in the administration costs left Hepper furious, but there was no one else to run RHI and it had already been opened. Eventually, they settled on a compromise figure. But there were a series of unresolved issues which would lead to disputes down the line. It would later also become clear that Ofgem was planning to inspect only a tiny handful of RHI installations – something which meant that fraudsters were unlikely to get caught.

But even though the scheme was profoundly defective from the outset, the damage did not have to be fatal. If the tariffs were reviewed regularly and the scheme was monitored, it would quickly become apparent that there was a problem. Even in that optimistic scenario, the first claimants to get into the scheme would benefit from a grossly over-generous subsidy. But the problem would be halted before it became insurmountable. However, what was to follow would make it much harder to believe that what had happened in setting up the scheme so disastrously had been entirely accidental.