by Sam McBride
A DUP source who at a senior level worked with Crawford over many years described the spad as having been ‘so, so close’ to Moy Park. The political figure said: ‘Moy Park certainly cultivated that relationship – dinners, lunches, etc. But I don’t believe for a second that Crawford was paid by them.’ The DUP source also said: ‘Andrew Crawford was unusually interested in RHI. He was all over it like a rash.’
Crawford set out to the inquiry some of his links – as well as his family’s financial link – to the firm. He met Moy Park’s chief executive about once a year but had ‘more frequent contact’ with four other senior figures – Alan Gibson, his successor as agriculture director, Brian Gibson (described by Crawford as a neighbour and a family friend), the senior manager who managed the poultry house expansion, David Mark, and Mike Mullan, Moy Park’s executive director for human resources.
At the heart of government thanks to Foster, Crawford was consistently working on behalf of Moy Park’s interests. When asked to explain why he had removed a reference to the poultry industry – essentially synonymous with Moy Park – from a crucial Stormont document in early 2016, Crawford’s answer to the inquiry was potentially revelatory. The former spad said that he was ‘very conscious at this time that this was going to become a very public debate’ and that ‘this was the first time that it was going to other ministers in the Northern Ireland Executive’ and he was ‘concerned’ that singling out Moy Park or the poultry industry was ‘unfair’.
Even at that late stage, when Stormont knew it was having to pay for what had been a disastrous scheme – something which might have caused someone in Crawford’s position to have felt angry at how aggressively Moy Park had taken advantage of RHI – he was instead seeking to protect the company. The consequence of his action was that the paper, which went to other ministers in the Executive, did not give the full picture.
Having failed to secure the incinerator, Moy Park turned its focus elsewhere and Stormont bent over backwards to help. Investigative journalism by the website Source Material in the wake of the RHI scandal uncovered how in tandem with RHI, Foster’s department had used another green energy subsidy, the NIRO, to facilitate Moy Park using Anaerobic Digester (AD) plants which used poultry litter to create electricity.
In 2012, Stormont set up the Agri-Food Strategy Board to create a ‘strategic action plan’ for farming and was chaired by Tony O’Neill, a senior director at Moy Park. Two years later, by which time he had left Moy Park, O’Neill set out forthrightly that the industry expected Stormont to do as told: ‘We will be suitably demanding and critical if they are not doing exactly what we ask them to do.’
The following year Stormont created what it described as ‘a dedicated team of officials’ to help Moy Park expand despite its environmental problem. By 2015, as the rest of the UK was cutting subsidies for AD plants, O’Neill’s committee successfully lobbied to lock payments at the top level. By the following year they were four times higher than anywhere else in the UK.
A policy, which was presented to the public as evidence of Stormont’s commitment to the environment, was actually designed with the poultry industry specifically in mind, according to documents unearthed by Source Material journalist Marcus Leroux. The subsidy was ‘an indication that government is highly supportive of sustainable solutions for poultry litter’, according to speaking notes prepared for a senior civil servant.
At the same time, Stormont ministers approved a £12 million loan scheme ‘supporting the NI poultry industry in developing sustainable treatment solutions to comply with the Nitrates and Water Framework Directives’. That taxpayers’ money went to build two giant biogas digesters, one specifically designed to deal with Moy Park’s poultry waste. Moy Park was by now so deeply intertwined with Stormont that a briefing document of the Department of Agriculture’s top official considered the idea that AD plants for Moy Park should be classified as ‘strategic assets’ and fully funded by the government along a model used for the army’s Challenger tank. A hugely profitable multinational company shovelling money to its shareholders in Brazil and the USA was now being talked about in the same breath as the defence of the country. The answer drafted to that question was enlightening. It said: ‘The Challenger tank was procured by the MoD which is not bound by EU procurement rules around State Aid.’ The significance of that was that it showed that Stormont was not saying that it would be either wrong or undesirable to treat a multinational company in the same terms as the defence of the nation; rather, it was prevented from doing so by EU state aid law. Given the later suspicion that RHI had been used to circumvent state aid law, that is potentially significant.
Stormont was so desperate to help Moy Park expand that it contradicted its own stance – and that of Moy Park – to do so.
A major problem with AD plants is that the sludge left at the end of the process is spread on fields and contains just as much ammonia as the untreated litter. In 2008, when Moy Park was still pushing the incinerator, it admitted that poultry litter ‘does not lend itself well to the process of anaerobic digestion’ which ‘does not remove the nitrates and phosphates which is essential to comply with [EU law]’. Stormont agreed, saying that the use of AD ‘does not address the fundamental issue of excess nutrients in the manure, as it requires land spreading of the digestate’. Yet once the choice became between protecting the environment or allowing Moy Park to expand, Stormont immediately decided that the company’s growth was paramount.
Source Material calculations showed that Moy Park’s lobbying helped unlock subsidy payments for biogas which are likely to ultimately hit £830 million, although much of that money will go to other companies. The payments are funded by charges added to household energy bills across the UK. Just as with RHI, Northern Ireland received far more than its ‘fair share’ of the UK pot. Essentially, GB consumers were paying a charge on their electricity bills to facilitate the expansion of Moy Park in Northern Ireland. Moy Park’s extraordinary influence at Stomornt in dealing with poultry litter is potentially crucial to understanding cash for ash. That is because, as with AD plans, the RHI scheme involved Moy Park benefiting – and GB paying. It involved Stormont consciously making its scheme more generous than that in GB, in the belief that doing so unlocked ‘free money’. And it involved two of the central characters involved in RHI: Foster and Crawford.
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By the time RHI was shut, 943 of the 1,526 poultry houses owned by Moy Park’s farmers were heated under the scheme. About half of all RHI boilers were linked to Moy Park. No single entity came close to benefiting as handsomely from RHI. Even those allegedly heating empty sheds to pocket the subsidy were bringing in sums which were dwarfed by the legal gains for Moy Park.
The company operates a complex – and secretive – pricing structure, making it difficult to comprehend how RHI payments to farmers benefit its shareholders. That mystique ended on 22 June 2018 – the day that major Moy Park farmer Tom Forgrave gave evidence to the RHI Inquiry. Until that point the public perception was that poultry farmers – who on the published list of RHI payments occupied many of the top positions – had greedily milked the public purse. Forgrave’s evidence was that while the money seemed to be going to the farmer, much of it ended up with Moy Park. At considerable personal risk, given Moy Park’s dominant position and his dependence on the company, Forgrave pulled back the curtain on what had gone on.
Forgrave’s evidence showed that RHI had allowed Moy Park to improve the quality of its product while slashing the proportion of what it paid farmers to heat poultry sheds – in the knowledge that they had a separate income. In essence, RHI was a backdoor subsidy to Moy Park. Forgrave said that prior to RHI, Moy Park set chicken prices in a way which effectively covered all its farmers’ production costs. However, he said that after RHI the company – despite gaining significantly – no longer covered all heating costs. Farmers instead found RHI making up the significant shortfall in their income. Forgrave then wen
t on to set out how Moy Park’s ‘clever business model’ had the effect of driving poultry farmers into RHI. He said:
As more hot water systems went live, the performance and welfare continued to improve and at almost every quarterly monthly meeting [with the company] a further 50% of the total financial savings brought about by improved performance was removed from the price paid to the farmer. This continued each and every quarter to the point where any financial benefits to the grower [farmer] due to improved performance had been eroded to zero.
He added: ‘As of present day, all financial benefits derived from any improvements in performance achieved from the move to hot water heating have been removed from the growers [farmers] and they remain on the same margin that they were on in 2013, with only a small inflationary-linked increase.’ He said that the switch from problematic ‘wet’ heating provided by gas burners to ‘dry’ heat from indirect hot water heating fuelled by biomass boilers was ‘one of the biggest changes implemented in the poultry industry in the last 30 years’ and was enthusiastically promoted by the company.
The system the company had in place meant that after it had successfully encouraged a critical mass of its farmers to switch to the new heating system, the others either had to follow suit or would find themselves at a serious competitive disadvantage. Forgrave – who received £750,000 in subsidy during the first three years of the scheme – said there was tension between farmers and Moy Park because the company had set an acceptable figure for heat usage which was far short of what was required to maintain poultry sheds to optimal standards for bird welfare. He said that farmers then had to decide whether to make up the heat shortfall out of their own pocket or see conditions for their birds deteriorate.
A week later, senior Moy Park manager David Mark, who was one of the company’s key figures involved in the rollout of hot water heating systems fuelled by RHI boilers, gave evidence to the inquiry. Mark had a particular reason to be au fait with RHI – he was heating his home with an RHI boiler for which he received payments under the non-domestic scheme. Even though the boiler was mainly heating a domestic property, he secured the subsidy because he rented several rooms in his home to guests on Airbnb. The boiler – registered in the name of his wife, Joy – was installed at the height of the spike, just before cost controls, and they claimed £9,236 in the first 16 months. Mark was deeply reluctant to accept that Moy Park had benefited from RHI. However, he eventually admitted that the subsidy had what he described as ‘a minor part to play’ in improving its efficiency. Detailed scrutiny by the inquiry of heating figures showed that Moy Park paid its farmers considerably less for heat than what its internal documentation described as reasonable.
Mark described in a document heat usage of between 1,800 kWh and 2,000 kWh per thousand birds as legitimate – and elsewhere Mark suggested to a bank that a poultry farmer could use 5,000 kWh and it would be reasonable. However, Moy Park only paid its farmers for about 1,400 kWh of heat per thousand birds – a lucrative financial benefit to the company.
Mark insisted that he was motivated not by attempting to enrich Moy Park, but ‘trying to guard against’ wasteful use of heat by setting the heat allowance at a lower level. Initially, Mark denied that he had ever seen RHI as a ‘safety net’ for Moy Park’s suppliers. However, barrister Donal Lunny showed him a document where he had used that precise phrase, saying that if a Moy Park farmer was struggling, ‘the £20k RHI is a big safety net’ in what would otherwise have been an ‘unrecoverable disaster’. Mark then insisted that was ‘in a different context’.
Like Mark, Moy Park’s chief executive at the time of RHI, Janet McCollum, was doggedly unwilling to accept that the company benefited financially from RHI. In her written evidence, she said: ‘Moy Park has not indirectly earned any RHI scheme tariff income.’ But, under forensic scrutiny by the inquiry, McCollum eventually admitted that the corporation indirectly made money from RHI. She acknowledged that RHI not only helped Moy Park’s rapid expansion by funding better heating systems for poultry houses but also helped make up for a shortfall between the fuel allowance which the company was prepared to pay to its farmers and the cost of the fuel which they required to raise chickens. However, the trained accountant, who had previously been Moy Park’s chief finance officer, insisted that she was ignorant of that fact at the time when the company was reaping the financial reward.
What the inquiry did not hear was that the lucrative nature of RHI for poultry was widespread knowledge long before the scheme was shut. In November 2014, an article with the title ‘The poultry farm nest egg’ appeared on the website of Celtic Green Energy, a Welsh-based renewable energy company.
Highlighting that Moy Park’s GB operation was increasing the number of its biomass boilers from 68 to 86, the article said that while ‘Moy Park enjoys promoting the fact that they will be saving around 18,500 tonnes of CO2 per year thanks to these new biomass boilers … the government have this sweet little earner for companies that use renewable fuels, known as the renewable heat incentive (RHI) scheme. This scheme is worth BIG BUCKS especially if you have 86 biomass boilers installed!’ It said that because poultry farms require heat all year round they ‘can earn an incredible return’. It calculated that even on the GB scheme – with tiering – Moy Park’s 86 boilers would likely be earning over £1 million a year through RHI payments.
The boiler installation company was openly attempting to persuade poultry farmers to realise how lucrative the GB RHI was at that point. Is it really credible that Moy Park did not realise how valuable RHI was to its business, and did not realise that the Stormont RHI was uncapped and therefore far more beneficial than even the GB scheme?
By the time McCollum gave evidence to the inquiry she had been replaced at the head of the company. Intriguingly, after her evidence, the new chief executive, Chris Kirke, submitted a written statement to the inquiry in which he contradicted what she had said. He claimed that ‘the RHI scheme did not of itself provide any enhanced financial benefits to Moy Park’. However, even in rebutting the claim of financial gain from RHI, Kirke admitted such gain, saying that ‘the RHI scheme certainly stepped up hot water heating installations’ – something with myriad benefits to Moy Park. He insisted that the availability of RHI and Moy Park’s massive expansion had been, in the words of RHI Inquiry barrister Donal Lunny, ‘a happy coincidence’.
Moy Park’s credibility is undermined by its lack of candour when the story first broke. In December 2016 the company told the BBC: ‘Moy Park derives no financial benefit from poultry farmers participating in the RHI scheme.’ The company also said at that point that it had nothing to do with lending by banks to Moy Park’s farmers, something it said was ‘between the lender and borrower alone and have nothing to do with Moy Park’. It was an attempt to put the greatest possible distance between the company and a scandal which at that point was on course to topple devolution. But it was wildly misleading. Moy Park manager David Mark was working closely with banks, right down to the banks passing details of individual loan applications to him for advice before deciding on whether to lend money. In March 2014, Mark gave a presentation to Danske Bank in which he set out Moy Park’s payback calculation for its farmers who entered RHI.
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Moy Park was willing to offer gifts to Stormont ministers it was seeking to influence. In December 2016 as the cash for ash scandal raged on newspaper front pages and across society, DUP minister Simon Hamilton was desperately attempting to find a way to slash Stormont’s RHI bill. Several of the options were obviously going to cost Moy Park. Hamilton recalled that he had been told by his private secretary that Moy Park had contacted him to offer him a free turkey. Hamilton told the inquiry that he was ‘aghast’ because he ‘thought this to be inappropriate in the circumstances’. He turned down the turkey.
On 30 November 2016 – just a week before BBC Spotlight and weeks before the turkey offer – during a visit to Moy Park Hamilton had met McCollum and Mullan.
He said he was ‘surprised [that] RHI was raised at all and especially in the context of Moy Park seeking a new RHI scheme … I was aghast at them raising the issue at all and especially in the way they did’. Hamilton said that Mullan then contacted his constituency office – rather than his department – in January 2017 as he prepared to move to retrospectively slash RHI rates. Hamilton felt the request for a discussion about RHI was ‘inappropriate’. But while Hamilton thought that Moy Park’s free Christmas turkey offer to him was inappropriate, not all of his party colleagues took the same view. In December 2012 – just over a month after Foster had opened RHI – she accepted a free turkey from Moy Park. Foster properly declared the gift internally in DETI, describing it as a 14-kg turkey worth £65.
Then in December 2015 – just after the poultry-driven rush, which had crippled the scheme – Moy Park approached DETI again. A source with knowledge of what happened recounted how Jonathan Bell had been offered a small, medium or large turkey. But the minister asked his private secretary, Sean Kerr, to phone the company back and ask: ‘Do you have anything bigger?’ Kerr made the call and Moy Park gladly offered a larger bird which Bell used to feed his extended family. A departmental source said that Kerr had told colleagues that Bell was ‘a greedy f****r’.
