Renewable Heat Incentive Inquiry examining botched energy scheme
Former DETI permanent secretary Dr Andrew McCormick gives evidence
Inquiry set up after public concern over scheme's huge projected overspend
Retired Court of Appeal judge Sir Patrick Coghlin chairing inquiry at Stormont
Public hearings entering critical phase with high-profile witnesses giving evidence
Image source, RHI InquiryMost have been to the canteen to refuel, some have been for a dander round the sunny Stormont Estate - now everyone is back in the Senate chamber for today's second session.
The inquiry takes a break so we're off to get a sandwich - see you at 14:05 for the afternoon session.
A key document that was prepared in July 2015 to outline the proposed changes to the RHI scheme for the DETI minister Jonathon Bell (below) before he gave his approval was "inaccurate and misleading", according to Dr Andrew McCormick.
Details about how the initiative was funded were not correct - it stated that the money was coming from the Treasury and "does not impact directly on Northern Ireland's departmental budgets".
But the DETI officials knew there would be a 5% penalty imposed on the department's own budget if there was an overspend.
Image source, PacemakerThe inquiry's heard that what was contained in the document made for a "significant downplaying of the need for concern" about the scheme.
Asked if he bears any responsibility for that, Dr McCormick says his role is to make sure that staff are in place who "will do the job well and will provide appropriate advice to ministers".
The advice in the submission had "very significant consequences in contributing to what went wrong" with the scheme.
The civil servants' actions in giving industry advance notice of the changes that were planned for the RHI scheme in 2015 showed a "lack of any sort of commercial awareness", says Dr Keith MacLean.
It's "astounding", he adds.
The firms that were being fed the information used it to the benefit of themselves and their clients by sharing it widely and encouraging people to sign up to the scheme before it became less lucrative.
Image source, Getty ImagesThe officials involved - Stuart Wightman and Seamus Hughes - claim that they shared the information as an informal way of gathering feedback about the policy from industry.
But Dr McCormick doesn't accept that argument - not all companies were told of the impending changes and he says it was therefore a "very selective and limited market sounding".
"Unless they're going to all the players across the whole industry in a totally even-handed way, in which case you might as well make the announcement."
Civil servants at DETI were in frequent contact with the energy and agri-food industries in the summer of 2015, informing businesses about the planned changes to the RHI scheme.
The contact included revealing details about the cuts to the subsidies on offer that would come into effect that autumn - the information was freely handed out even before the DETI minister had seen it.
Image source, RHI InquiryThe inquiry has heard a lot about those exchanges from the officials and some of the industry figures involved but Dr Andrew McCormick wasn't aware of them at the time.
He says that information sharing was "inappropriate" and worsened the problems for his department in relation to the scheme's spiralling overspend.
"We're responding to an emerging difficulty and we're disclosing our hand far too openly," he says.
DETI's internal auditors should've been asked to examine the RHI scheme in the summer of 2015, Dr Andrew McCormick accepts.
He says he bears personal responsibility for not referring it to them but he adds that senior audit staff didn't go to him to ask questions about it either.
Image source, RHI InquiryHe says that at the time the scheme didn't appear to be something that "would've prompted a more deep investigation" but "it should have, probably".
Inquiry panellist Dame Una O'Brien says it's a "stark fact" that DETI's auditors didn't look at the RHI scheme - which was "novel, contentious and highly innovative" - until after it had been shut down in 2016.
"It's hard to understand how that could be because that's a major system that's designed to protect public money," she adds.
There was a "celebration of success" among the DETI officials running the RHI scheme in summer 2015 that the number of applications had unexpectedly risen sharply, says Dr Andrew McCormick.
He admits that civil servants didn't understand why more people were signing up - it was because the subsidies on offer were so generous.
There had been "all the frustration" in previous years when the scheme hadn't drawn the numbers of applicants that had been hoped.
His staff therefore felt it was "great that we've got such a high rake of takeup now - that's what we wanted" because it would help the department to meet a key target of increasing heat production through renewable energy sources.
"That psychology is, I think, right at the heart of the problems here."
One senior DETI official has said the decisions taken over the RHI scheme in June 2015 left the department "boxed in with few, if any, choices".
Shane Murphy told the inquiry "the department was haemorrhaging money".
Image source, Getty ImagesDr Andrew McCormick says it's a fair analysis and that the officials weren't aware of how bad the outward flow of money was.
"We were nothing like as sensitive to the scale of difficulty as we should have been," he admits.
DETI concluded that it didn't need to carry out a public consultation in the summer of 2015 on its plan to add cost controls to the RHI scheme but Dr Andrew McCormick says he's "not 100% sure that was sound".
The rationale for the department's view was that it had carried out a consultation about general cost controls in 2013 so it could plough ahead.
Image source, RHI InquiryBut the specific mechanism that DETI wanted to add to the scheme wasn't mentioned in that 2013 consultation and that causes Dr McCormick to doubt whether the right decision was taken.
Asked whether the department took legal advice before it made its decision, he admits that he doesn't know.
Shaking his head in disbelief, inquiry chair Sir Patrick Coghlin says it's "such a bizarre situation... from every aspect".
DETI obtained legal advice in late June 2015 about its proposals to address the RHI's problems.
The advice didn't say that the scheme couldn't be suspended and it didn't say adding tiering was the only way forward - the lawyers said any action DETI took should be done through legislation and that would have to involve a public consultation.
Image source, RHI InquiryDr Andrew McCormick says DETI's view was that a consultation would've taken too long.
He says the conclusion reached by officials was that they would not have to consult on the introduction of tiering although he know admits it was " dubious point".
Image source, RHI InquiryEven though a review of the RHI scheme never took placed as had been required, a DETI official told counterparts in Stormont's finance department in July 2015 one had been done in October 2013.
Sir Patrick Coghlin says that was an attempt by civil servant Trevor Cooper to "put up some sort of camouflage".
A review of the subsidies on offer in the RHI scheme would've been an obvious way to trying to work out what had gone wrong with the initiative, agrees Dr Andrew McCormick.
Asked whether there should've been a "closer look or a deeper dive", he says: "Yes, very clearly."
Image source, Getty ImagesThe scheme had been originally approved by Stormont finance department and by EU state aid regulators before it opened in 2012 on the basis that a review of it would be conducted at the start of 2014 but it never happened.
Dr McCormick says there's "no good explanation" as to why that was the case.
Civil servants at DETI "missed a big opportunity" in June 2015 to spot some fundamental problems with the RHI scheme, admits Dr Andrew McCormick.
There was a "collective responsibility on all of us to have thought more, asked more probed more," he adds.
He says there was "so much" material that could've been looked at that would've helped them to pick up some of the key issues but there was a "collective failure" on the part of officials to do that.
Dr Andrew McCormick says he doesn't remember the dangers posed by the unlimited nature of the RHI scheme being made "clear, being explicit" during meetings he attended in the summer of 2015.
Inquiry chair Sir Patrick Coghlin asks why the witness thought the tiering of the subsidies on offer was being discussed - tiering is an important mechanism designed to prevent a claimant from overusing their heating system to collect more cash.
Dr McCormick says he didn't have detailed discussions with DETI officials as to why tiering was to be introduced in the scheme.
Asked how worried he was that a scheme that was operating when he was the permanent secretary at DETI "was now out of control", he says he was very concerned.
He admits that he should've asked more questions but "on the face of what was coming forward here was sufficient and appropriate action".
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One of the key civil service figures in the RHI debacle, Dr Andrew McCormick was the permanent secretary - the top civil servant - at the Department for the Economy, formerly DETI, which set up the energy initiative.
He was in that post at the time when big cracks began to appear in the RHI scheme through until after its emergency closure.
He had to clear up much of the mess that was created in the department by the political fallout over the scheme in late-2016 and early-2017.
He has since switched roles and now has just as big a task on his hands as he deals with all things Brexit as Stormont's director general of international relations.
His witness statement to the inquiry makes for a dramatic read and you can find it in three parts - here, external, here, external and here, external.
He appeared before the inquiry twice last month, saying that he didn't "recall any resistance" from DUP advisers to the RHI scheme being placed on the agenda during ministerial meetings.
Quick fact - his PhD was in isotope geochemistry.
As an old inquiry hand having given evidence on 4 and 5 September, Dr Andrew McCormick doesn't need to be sworn in again.
Image source, RHI InquiryThe inquiry's senior counsel David Scoffield QC explains that he'll be returning to the point he left off in the previous session with Dr McCormick.
That's the pivotal period in June 2015 when it became clear that urgent action was required to prevent the RHI scheme running off the rails.
Jayne McCormack
BBC News NI politics reporter
Stormont's finance department was effectively "backed into a corner" to approve more funding for the RHI scheme when its budget had spiralled out of control, the inquiry heard.
Officials who were working on the scheme had drawn up a proposal to add cost controls to it in autumn 2015 and publicly announced their intention before the finance department was given sight of the plan.
Image source, RHI InquiryInquiry counsel Joseph Aiken suggested that things had been done the "wrong way round".
Emer Morelli, a senior finance official, said the ship had "very firmly sailed" by the time the plans were put to her department.
BBC News NI
An independent inquiry into the RHI scandal was established in January last year by the then finance minister Máirtín Ó Muilleoir.
He ordered it in the wake of the huge public concern and what was then a major political crisis surrounding the scheme.
The RHI Inquiry began in November last year and Sir Patrick Coghlin (below), a retired Court of Appeal judge, is its chair and has been given full control over how it will operate.
Image source, PacemakerIt is looking at:
For more information on the RHI Inquiry, you can read our handy Q&A.
When the scale of the overspend emerged, public and political concern rocketed.
As the minister in charge of the Stormont department that set up the RHI scheme, the DUP leader Arlene Foster faced calls to resign from her role as Northern Ireland's first minister in December 2016.
Image source, PacemakerShe resisted, and Sinn Féin's Martin McGuinness then quit as deputy first minister in protest at the DUP's handling of what had by then become a full-blown political crisis.
That move brought about the collapse of the Northern Ireland Executive. Now, well beyond a year-and-a-half on from that, Northern Ireland remains without a devolved administration.
You can find much more detail on the RHI scheme in our need-to-know guide.