Resolution reached over NIE clawback

The Department of Enterprise, Trade and Investment has reached a resolution to ‘clawback’ a total of £1.247m from Northern Ireland Electricity (NIE).

This follows binding arbitration by an independent Expert and negotiations with the company and includes £260,247 already paid by NIE in 1998.

The ‘clawback‘ of profits from property sales arose under the Deed of Debenture agreed by the then Department of Economic Development with Northern Ireland Electricity (NIE) following the privatisation of the Northern Ireland electricity industry in 1992.

Commenting on the resolution, the Enterprise Minister, Maria Eagle, said: “This complex matter has taken an inordinate time to resolve. However, I am satisfied that the Department has done all it can, with the benefit of legal and valuation advice, to secure the best possible outcome for taxpayers.”

The “clawback” negotiations arose following the sale by NIE plc of property that had been transferred to it when the Northern Ireland electricity industry was privatised in 1992. Under the terms of the Deed of Debenture, the Department is entitled to receive 50% of any profits accruing from any such relevant disposal of property by NIE during the ten years from privatisation.

The Minister added: “The intention of the 1993 Deed of Debenture was to ensure a fair return for taxpayers on any profits secured by NIE on relevant property disposals. However certain aspects of the Debenture were open to interpretation and this was reflected in the independent Expert’s findings.”

Notes to Editors:

1. The monies have now been paid into the UK Consolidated Fund as provided for in the Deed of Debenture.

2. The Deed of Debenture governing the NIE clawback arrangements is a standard HMT document which, at HMT insistence, was modified only to reflect NI law and the circumstances of the NI electricity supply industry, where required.

3. The independent Expert’s fees in determining the calculations for clawback purposes came to £40,208. Of this figure £26,135 (65%) has been paid by NIE plc and the remaining £14,073 (35%) paid by the Department.

4. This will have no negative impact on Northern Ireland consumers.

5. The Department of Finance and Personnel’s Valuation and Lands Agency provided land valuation advice to DETI throughout the dispute.

Press enquiries to Nicola Steele, DETI Press Office, Tel. 028 90529297