Matters arising from PAC’s interrogation of NIW and DRD

Slugger has had sight of the letter (update: copied – below the fold) on Phoenix Gas headed note paper and signed as Group Chief Executive, Peter Dixon sent to Paul Maskey, chair of Stormont’s Public Accounts Committee complaining of insinuations made by PAC members Patsy McGlone, John Dallat and Dawn Purvis against him as a pro Bono member of the internal review panel during last Thursday’s gripping three and a half hour session of the PAC at Stormont.

Update: Nevin has a transcription here.

Slugger understands that at least one of those members has written in reply to ask whether, having written on his company’s headed note paper, was he writing in his capacity as Chief Executive with the approval of the board of Phoenix Gas and/or their owners Terra Firma.

It should also be noted that despite Mr Dixon’s allusion to possible legal proceedings, all of what passed inside the PAC is covered by ‘parliamentary privilege’. Please note that Slugger readers have no such rights!!

Here is the letter in full (apologies for the poor quality – it has been copied from an iPhone photo)

Dixon letter page one

Dixon letter page two

In the meantime, several important clarifications remain outstanding for both Mr Priestly and Mr McKenzie. Contrary what is often thought within our long self directed senior civil servants the present and future will *not* look better if the past is kept in the dark. It is becoming clear there is a great deal more to this story than we yet know.

Perhaps the PAC should as it’s chair alluded last Thursday, and pursue these matters in the recess?

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  • Pigeon Toes

    “Slugger understands that at least one of those members has written in reply to ask whether, having written on his company’s headed note paper, he writing was writing with the approval of the board of Phoenix Gas and/or their owners

    Especially with reference to his desire to bring legal proceedings in a personal a capacity.

    Oooops ?

  • wild turkey


    which do you think will occur first

    1. your receipt of a letter from Mr Dixon (Phoenix letterhead optional) with possible threats if his correspondance is not withdrawn from slugger or

    2. a visit from the heat as they try to ascertain the source of the leak?

    in any event, keep up the good work.

    PT, given that Mr Dixon’s eloquence is hard copied on Phoenix letterhead, the default assumption has to be that the letter was written on company time.

  • Mick Fealty


    The letter above was shared with Slugger by one of the MLAs on the committee who was copied in. As for ‘leaks’, well that’s a matter for conjecture, but someone clearly leaked material to the PAC, otherwise the MLAs in question would not have had the wherewith all to ask such forensic questions. Congressional hearings have substantial powers to investigate the activities of senior Civil Servants, and others.

    Anyone know what the situation is at Stormont?

  • DC

    Mr Dixon should go on Youtube instead and ask where the MLAs were between 2003-07; he should ask if they received payment and took it all and also if they used headed letters of the Assembly despite their offices having no official function.


  • Pigeon Toes

    As someone who has been on the receiving end of a similar “independent investigation” by DRD, I welcome any leaks which enable our MLAs to ask the hard questions.

    Too often they have been reliant purely on the information provided by civil servants and indeed the authors of these “investigations”.

    Whilst the reports can indeed be “evidence based”, it may well depend on selective use of “evidence” and witness statements.

    Schadenfreude? Absolutely…

  • Mick Fealty

    Just watch your Schadenfreude doesn’t turn into something you might regret. I’ve already had to take one of your posts down at a time when I really could have done without the hassle.

    Let me just say that the particulars of this case are fascinating but the picture they point to is both complex and multilayered. It seems likely that there’s not just one smoking gun here, but several.

    But it really doesn’t help for people to over speculate based on their own past experience of other matters relating to the department. The evidence has to be unearthed in a careful and responsible manner.

    Which is one reason the Chair of the PAC might be well advised to reconvene and get to the bottom of this sooner rather than later.

  • Pigeon Toes

    I realise where the other post had gone astray. My apologies..

    I too could have done without “the hassle” of the past couple of years, but it seems that particular issue was indeed too complex for some to grasp.

  • Transcription of Dixon letter to PAC chairman available here.

  • Mick Fealty

    Just behave!

  • J

    Well, it seems that the NICS unit responsible for oversight of NIW since its establishment – and the people responsible for the Governance Letter – did not detect these goings on.

    It was interesting to see, or rather not see the head of that unit being grilled by the PAC. I wonder why…

  • “Since its launch in 1994, Terra Firma has focused on buyouts of large, asset-rich businesses – often with complex structural or regulatory issues – which are in need of strategic, operational or management change”

    I wonder if it has its eye on NI Water 😉

  • wild turkey

    just curious like but, Mr Dixons letter (thumbs up to Nevin) makes no reference to the email, noted by Nevin in an earlier post.Nor is reference made, IF THERE WAS ANY, to Mr Dixons subsequent written/emailed or spoken response. Perhaps Mr Dixon thought the that the need for ‘help from friends’ did not merit a response?

    How would you be fixed for a ‘catch up’ next week? Lots going on!…
    Would work for me
    I need help from friends at the minute.
    Hope things are fine with you now.”

    any significance to this ommission in Dixons letter? just curious

    in any case, hopefully Mr Dixon can now get his life back

  • J

    Mr Priestly is an intelligent man and I for one don’t understand his being non-plussed at the question which was put to him about the other NEDs being given the option that Mr Price apparently was – to support the CEO.

    The others, being non-executives, whose primary function is to constructively challenge executive action, should have responded in the negative to any question of their having to give unqualified support to the chief executive. To give that support would be to negate their role.

    They weren’t given the option. Prt of Mr Price’s role was to report on the former Chair. It would seem that only one of the NEDS was seen as a reliable set of “eyes and ears” for the Department.

    But the question remains: why did the Shareholder Unit not know what was happening? Was the Governance Letter reviewed as was stipulated when it was agreed with the DR MInister?

  • J

    Mr Mellor’s response via the Tele yesterday was a masterpiece of calm restraint. This man took on 2 roles (contrary to good governance, as he well knew, but undertaken to help DRD out of a hole once they obliged Katharine (former CEO) to go.) This is his reward. I would be surpised if he doesn’t say more, but he may well be too honourable to go further.

    Had there had been a proper oversight of the shareholder function this sort of thing would have been handled differently and probably better. That critical function is handled well below the level of the CS represented in front of the PAC (below SCS) but the Director of the SU should have been there. The Dep. Sec was a poor substitute as this is but 1 of her reponsibilities. Overseeing NIW governance is the sole responsibility of SU – one must wonder about the future of the Director, given the Hell that the Perm Sec had to go thru the other day.

  • “what have been demonstrated by the evidence to be deplorable procurement activities in the public sector” … Dixon letter

    Why then did the IRT pull its punches in the February 2010 report? The strongest denunciation I can find is “a serious failure in procurement governance surrounding public
    funds.” ‘Deplorable’ does not appear.

    If such deplorable activities have been rampant across the public sector why hasn’t the PAC or, for that matter, any other committee been picking them up. I’ve previously referred to £1.2 million being budgeted by DRD for a passenger only ferry on the Rathlin route, this not being mentioned in the tendering processes and only £0.7 million being returned after the matter was made public. This information was brought to the attention of the relevant MLAs and committees but they sat on their hands.

  • Pigeon Toes

    The Chairperson:
    “Again I ask you to be brief. As the Department’s accounting officer, can you tell us whether it
    was a failure on your behalf not to have found that out?
    Mr Priestly:
    I do not believe that it is not a failure. It is regrettable that it did not happen. The arrangements
    were in place, but it was not identified.”

  • Pigeon Toes

    Double negative, or slip of the tongue?

  • Mick Fealty

    With a 96% compliance rate I would say, prima facie there were no actual punches to be pulled.

  • J


    I think you should let the ferry sink, if you excuse the expression…;(

    This shows mishandling of public money on a significantly different scale. One needs to look at how tight the governance was and how responsible the Accounting Officer is and was and how his own civil servants let him down. NIW or WS did their own thing for decades and didn’t let Agency status (in DOE(NI)) change that nor establishment as a GoCo. The Governance Letter between NIW and DRD is in the public domain (thru the DRD Committee). It should be examined closely.

  • J, you can look at the issues the other way round. If they can’t deal with the small issues can there be any expectation that they can deal with the large ones.

  • Pigeon Toes

    It is a matter of some regret that PAC members couldn’t have got got here earlier…

  • J

    I know this man personally and this treatment (sacking) has shocked everyone who knows him. MONITOR have stood by him as a man of honour, integrity and transparency. He was well thought of in NIW – more so than the current boss!

    He would not have done what he did and said what he did in the Tele was it not for the way in which he and others have been characterised in the public glare. How ironic is it that a SF Minister keeps in post the man in charge of the Northern Bank and sacks the only other NI NED in the company?

  • Dixon’s ‘deplorable’ is matched by the following:

    “Mr Priestly: From the outset, I acknowledge that the events that the Committee is considering today are shocking, indefensible and unacceptable.”

  • J

    For continuity of practice between WS and NIW, one might look to continuity of direction between the 2 organisations. That is not the Board. Nor Chris Mellor. Certainly not Declan. Who is suspended, pending investigation?

  • Mick Fealty


  • Pigeon Toes

    And equally honourable men were “sacrificed”. Had the hard questions been asked two years ago, perhaps Mr Mellor et al would not have had their integrity questioned either.
    Thankfully Mr Mellor has a high enough profile to have had his right of reply published.

    I don’t think that Nevin or indeed others ever said that the whole ferry business was a burning issue in the minds of NI population at large. Rather an example of just how badly procurement can be manipulated by those in power.

  • Pigeon Toes

    I am aware that Mr Gormley has written to the Regional Development Committee on a number of occasions, requesting his right of reply.

    Unsurprisingly this has been refused…

    I hope that Mr Gormley is in a better position than those “screwed over” by the whole ferry nonsense.

    But as someone once infamously said ” we haven’t gone away you know….”

  • Pigeon Toes

    And let’s just have a look at the careers of other DRD IRT members and DFP “expert witnesses”;news;item/12/405/

  • Pigeon Toes

    I know this man personally and this treatment (sacking) has shocked everyone who knows him. DRD should have stood by him as a man of honour, integrity and transparency.

    In human terms, are the lives of those destroyed by the ferry fiasco any less valuable than those within NIW?

    As a percentage of the ferry contracts let by DRD, it was 100%. So um statistically it was hardly “world class”

  • Here’s one link which deals with emails (withheld), probity and significant percentages.

  • Perhaps a PAC member could come on Slugger and inform us which other ‘questionable’ procurement processes PAC has investigated since devolution was restored in the spring of 2008.

  • Some more food for thought:

    “I have a few suggestions about the source of the funding for the adequate sewage treatment system that the Province so urgently needs. The Committee for Regional Development noticed recently that Northern Ireland Water will pay the Department for Regional Development a £43 million dividend from its income this year. Therefore, money will return to Government coffers. During these difficult economic times, is it too radical to suggest that DRD does not accept that £43 million, but allows Northern Ireland Water to spend the money on infrastructure projects in respect of the sewage treatment system?

    Furthermore, the Committee recently discussed the monitoring round, during which £25 million had to be found for an unavoidable cost, namely the re-designation of the status of Northern Ireland Water. The Committee had no way of avoiding that particular sleight of hand. Could the re-designation proposal have been postponed for a year to enable major upgrades of many sewage treatment works?” .. Jim Wells 17 Feb 2009

    Might the Treasury reclassification/re-designation be punishment for a failure to introduce (more substantial) water charges?

  • A link [pdf file] which I posted earlier which deals with reclassification and governance of NI Water.

  • OOPS Devolution was restored in May 2007!!

  • William Markfelt

    ‘But it really doesn’t help for people to over speculate based on their own past experience of other matters relating to the department.’

    I disagree.

    People’s ‘own past experience’ is wholly valid for speculative purposes if it helps to build up a broader picture of dirty deeds done dead cheap with whatever government department or agency is involved.

    There are few of us out here who would regard the entire NIA as anything other than flawed, corrupt and on occasions, almost personifying pure evil in their methods. If a correspondent has personal experience of flaws, lies, corruption, brown envelopes or anything else occurring within the auspices of the NIA, and particularly within the PAC, then all such comment is valid, and should be supported, at least as far as the libel laws are concerned.

  • William Markfelt

    ‘He would not have done what he did and said what he did in the Tele was it not for the way in which he and others have been characterised in the public glare. ‘

    This is not, by any stretch of the imagination, the first time that individuals have been vilified or attempted to be destroyed by the NIA machinery.

    The problem for the NIA this time is that they have taken on someone who is, relatively speaking, higher up the food chain and who has enough of a public profile for the Belfast Telegraph to show semi-interest.

    But it’s quite clear, for anyone who follows these things, that there is something rotten at the heart of Stormont, particularly in its readiness to destroy families, individuals and businesses without ever testing their witch hunts out in a proper court of law (and it’s some irony that a SF member, who presumably rightly opposed Diplock Courts for decades, should oversee PAC’s own kangaroo court system).

    Mr. Mellor’s sacking was yet another witch hunt, and yet another kangaroo court verdict. Hopefully he shall continue to voice his views that the entire stitch-up was unfounded, and make life as uncomfortable as he can for others. They deserve it.

  • Mick Fealty

    So £64 mill to set up as a GoCo… £24 Mill to redesignate as an NDGB? Nothing to do with delivering water, but much of it going to legitmate contractors in the consultancy business…

    As for a punishment, well you could see it as that, only it automatically kicks in when a certain subsidy level is reached. If it was a trap the it was one the Executive knew full well it was walking into.

  • William Markfelt

    ‘Mr Dixon was aggrieved by what he interpreted as unfair comments. ‘

    At this juncture, I’m not sure what the issue is regarding Dixon going nuclear.

    In a properly convened court of law, as opposed the PAC’s kangaroo variant, Dixon would have had the right of reply and the chance to cross-examine (or have someone do it on his behalf.

    But it appears that FEW of the major players get the right of reply. Granted, for those that did, it must have been an uncomfortable, sphincter-tightening experience, I’m glad to say.

    But surely if some of these politicos, several of whom banged on about the Diplock Court system for decades, can’t actually see that they’re now sitting in their own ‘no jury’ court, then their hypocrisy knows no bounds.

    Dixon should have had the right of reply. So should Mellor. In fact both, key players in this, should have been PRESENT. I know Maskey churns out this ‘well, we aren’t here to examine that’ shit, but quite frankly if he can’t see that certain actions, by certain individuals, are the reason why he and his committee are conducting their show trials, then he’s essentially unfit to chair it.

  • Mick Fealty

    Wrong thread William..