Public Inquiry on the Renewable Heat Incentive Scheme

Part of Ministerial Statement – in the Northern Ireland Assembly at 3:30 pm on 24th January 2017.

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Photo of Máirtín Ó Muilleoir Máirtín Ó Muilleoir Sinn Féin 3:30 pm, 24th January 2017

On my way in, my dear friend Chris Lyttle from East Belfast asked whether this will be an hour-long statement, and I said that I could do a summary at the top of the statement, which is that the type of inquiry that I would like to see — I think that it is an inquiry that he and members of the public would like to see — is a no-hiding-place public inquiry into the RHI scandal that asks, in public session, hopefully on TV, "What did you know and when did you know it?" Additionally, it would be an inquiry that follows the money, and, after all that, it would hold to account, no matter how high or low a position someone holds, anyone responsible for wrongdoing. The inquiry and its conduct will be a matter for the chair. I will move now to the formal statement.

Ar an 19 Eanáir, d'fhógair mé go bhfuil sé i gceist agam fiosrúchán poiblí a thionscnamh ar an scéim neamhtheaghlach in-athnuaite dreasachta teasa (SDT) — inniu, tagaim os comhair an Tionóil le sonraí an fhiosrúcháin sin a dhearbhú, lena n-áirítear ballraíocht an fhiosrúcháin agus a théarmaí tagartha. Mar sin féin, sula dtugaim faoi seo, tá sé tábhachtach go bhfanaimid dírithe ar na cúinsí a thug chun an phointe seo muid agus a chiallaíonn anois gur fiosrúchán poiblí an t-aon bhealach inchreidte chun tosaigh.

On 19 January, I announced my intention to institute a public inquiry into the non-domestic renewable heat incentive scheme. Today, I come to the Assembly to confirm the details of the inquiry. Before doing so, it is important that we remain focused on the circumstances that have brought us to this point and which now make a public inquiry the only credible way forward.

The non-domestic renewable heat incentive (RHI) scheme was introduced in November 2012 to support the then Executive's Programme for Government commitment to renewable energy. It was conceived with laudable ambitions, and optimism, to achieve 10% of our energy consumption from renewable sources by 2020. We must focus on why the botched RHI scheme went wrong and the circumstances surrounding it rather than the environmental principles underpinning it, which remain right and proper.

It is important to acknowledge that although this inquiry will examine allegations of wrongdoing, many people did act appropriately in relation to the RHI scheme. In particular, I would like to recognise the work of my officials who, working with the Comptroller and Auditor General, have diligently and fulsomely applied the principles of financial governance and probity as set out in the 'Managing Public Money' requirements. It was my officials who unearthed this financial calamity and formally notified the Comptroller and Auditor General, who then reported to the Public Accounts Committee. It is worth noting that that happened under the tenure of Minister Mervyn Storey on 19 January 2016. My officials have thus played a crucial role in bringing transparency and scrutiny to this scandal. Additionally, given the position of my Department at the nexus of government, I am ideally placed to initiate this inquiry.

The case for an independent investigation into the RHI scheme is clear-cut. In his June 2016 report, the Comptroller and Auditor General concluded that:

"This scheme has had serious systemic weaknesses from the start"; weaknesses that have resulted in overcompensation, abuse and significant financial risk to our Budget and the public services it supports.

According to the Comptroller and Auditor General, the RHI scheme has the potential to cost the public purse up to £490 million over 20 years. That is money that, as Finance Minister, I would much rather see being directed towards vital public services; strengthening the health and social care system, building an infrastructure that is fit for the 21st century, and educating and training people.

In recent weeks, we have had a drip feed of serious allegations of corruption, mismanagement, incompetence and political interference surrounding the scheme. Members know my preference — it is on public record — for a time-bound, independent, judge-led investigation under new legislation. That was underpinned by two key requirements to ensure that the public could have confidence that it would get to the truth and that this would come out for all to see.

First, it is absolutely vital that any investigation has the powers to compel witnesses and evidence. Secondly, the investigation needs to be free from ministerial control or interference. The need for agreement on new legislation and the pending dissolution of the Assembly meant that it was not possible to pursue that preferred approach. But there cannot be obstacles placed in the way of truth. That would be wholly unacceptable to the public.

In that context, the only way in which to respond to the public interest now is for me to launch an inquiry, to be held under the Inquiries Act 2005, reflecting the scale of public concern on the matter. I am pleased, therefore, to inform Members on the shape that that inquiry will take.

I now have in place an independent inquiry chair, distinguished retired Lord Justice of Appeal, Sir Patrick Coghlin, who was nominated to chair the inquiry by the Lord Chief Justice. I am very pleased that Sir Patrick Coghlin has agreed to lead this inquiry. I know that he will be unflinching in his pursuit of the truth and scrupulous in his analysis of the evidence. I have agreed with Sir Patrick Coghlin that he will be supported by two panel members to get to the truth of this affair. If the panel considers it appropriate, assessors may be appointed to assist them. These individuals, to be appointed, will have relevant expertise and be from outside the North.

I turn to the terms of reference for the inquiry, which I have made as broad as possible in order to give latitude to the inquiry chair in his work. It sets the framework under which the inquiry will investigate, inquire into and report on the RHI scheme. This includes its design, governance, implementation and operation, as well as measures to control the cost of the scheme from its conception in 2011 to the conclusion of the inquiry. While the areas it will investigate will be wide-ranging, it will necessarily include key areas in which there has been huge public interest, including the development and roll-out of the RHI scheme by the then Department of Enterprise, Trade and Investment; the signing off of the scheme by the then Department of Finance and Personnel; the issue of cost controls and tariffs; the delay in implementing cost control measures before November 2015, which led to the spike of autumn 2015; and the closure of the scheme in February 2016.

I want to thank the Assembly parties who met me yesterday for their input to the terms of reference, which has, along with Sir Patrick Coghlin's expert opinion, helped to shape a robust and balanced framework for the inquiry. I have laid a copy of the terms of reference in the Assembly Library. These will only be amended at the request of the chair. I repeat, the terms of reference will only be amended at the request of the chair. That is a power that I have under the Inquiries Act which I will not be using.

The inquiry team will begin its work on 1 February 2017 and will report as expeditiously as possible. Openness and transparency will be key touchstones for Sir Patrick Coghlin and his team. Earlier, I pointed to two key requirements, and the investigation will have the power to compel witnesses and evidence. Rest assured, every stone will be turned. There will be no dark corners where the light will not be shone.

There are shortcomings in the Inquiries Act around the potential for political or ministerial interference. Therefore, I wish to reassure the public by setting out the steps that I think must be taken to ensure absolute openness and transparency. The arrangements I have detailed in this statement are intended to ensure this. It is also important to stress the following: having been established, the inquiry will now progress entirely in the hands of the chairman. Sir Patrick Coghlin will, within the terms of reference I have set out, have absolute control over the scope and execution of the inquiry. The chair has indicated that it would not be appropriate to issue an interim report. Likewise, the chair informs me of his obligation to deliver the report to the Finance Minister. I call on all Members from all parties to join me in pledging that any future Finance Minister will immediately publish the report as received.

The inquiry will be impartial and objective. It will be tasked with getting to the truth of the RHI scheme. I will not interfere in its work. It will be entirely independent. There is an urgent need to get to the facts of the RHI scheme, to identify negligence, incompetence, alleged corruption and abuse, and to hold those responsible to account.

Tá mé feasach go dtéann an cheist RHI thar chúrsaí airgeadais chuig ceisteanna rialachais agus ionracais. Trí aimsiú na fírinne faoin scannal RHI, creidim go rachaidh an fhoireann fiosrúcháin seo, faoi stiúir Sir Patrick Coghlin oirirc, i ngleic leis na saincheisteanna sin agus dá bhrí sin, rachaidh sé bealach éigin le hatógáil a dhéanamh ar mhuinín scriosta an phobail sna hinstitiúidí.

Mr Speaker, I am aware that the RHI issue goes way beyond financial matters to questions of governance and probity. By getting to the truth of the RHI scandal, this inquiry team, led by the distinguished Sir Patrick Coghlin, will, I believe, address those wider issues and, therefore, go some way to rebuilding the shattered public confidence in these institutions.