Farmers’ union the UFU has said proposals to maintain restricted payments from the botched Renewable Heating Incentive Scheme could lead to “irrevocable financial damage to those businesses in the scheme”.
The Department of Economy has said it is seeking to extend caps on the RHI scheme for a further year. It had brought in restrictions, introduced by the then minister Simon Hamilton in a bid to cut costs.
Auditors found serious flaws with the potential for huge fraud due to a lack of tariff caps saying some participants could “burn to earn” from the London- and Stormont-backed £1bn scheme.
The Department of Economy estimated a £490m overspend in the 20-year scheme although have since conceded it was exaggerated by at least £160m.
- RHI farmer who claimed £900k says business has been hurt and my family insulted – ‘I wish I’d never heard of scheme’
The UFU said Northern Ireland farmers were having to pay the price of the ongoing lack of a government at Stormont. It said it was alarmed at the prospect payment restrictions would continue on for longer than was originally intended.
UFU chief executive Wesley Aston said: “We wanted clarity from the department around the RHI tariff situation. The permanent secretary has confirmed that while the revised tariff extension remains a proposal, he has clarified that it can only proceed with the return and approval from a government Minister.
“There is a fear amongst boiler owners that the 2017 temporary measures could be in place for much longer than necessary. Many farmers have made long term investments in a government-backed programme and it is wholly unacceptable they should have to bear the financial burden due to the ongoing uncertainty at Stormont,” he added.
Inspections are underway by a Stormont-appointed firm to determine if any of the RHI businesses are abusing the scheme.
“The UFU wants to see the ultimate roll-out of the full-inspection programme implemented as soon as possible,” Mr Aston continued.
“We have been calling for a full audit of all boilers for some time now. This would allow the vast majority of people who are using the scheme legitimately to clear their names and distance themselves from the unfair and sensationalised media coverage that has beset this issue since late 2016.”
A spokesperson for the Department for the Economy said temporary arrangements could be extended until March, 31 2019.
The spokesperson said: “The 2017 Regulations were never intended to settle the long term tariff arrangement for the boilers in question but were intended as a temporary measure to allow long term arrangements to be designed and introduced, to address fairly the fact that the original tariff was leading to excessive payments which were totally unaffordable for the public purse.
“The 2017 Regulations are currently subject to legal challenge, with the Court hearing due at the beginning of October. The Department for the Economy must await the judgment of the Courts before proposing any such long term arrangements.”
The spokesman added: “The Department intends at the appropriate time and subject to the decision of the Courts in the present Judicial Review to propose to an incoming Minister that the 2017 Regulations should be extended for up to a further year until March, 31 2019 – this could only happen if the Minister agrees and obtains Assembly approval.
“It must be emphasised that this would be a further temporary measure which would give the Department the opportunity to develop the long term arrangements needed.”
Established in November 2012, the RHI scheme was an attempt to increase consumption of heat from renewable sources. It was found to have paid more to boiler owners than the cost of the fuel. Auditors said there may have been potential fraud in order for some owners to profit from the scheme.
The scandal ultimately led to the downfall of the Executive and the current political deadlock. An inquiry has been established in order to examine the detail of the scheme and how it was allowed to get so out of control. It is set to begin proceedings in the coming weeks.