Fraud squad told to investigate ‘catastrophic’ £4.6billion Net Zero insulation scheme amid fears thousands of homes have been left unsafe

Britain’s fraud squad has been called to investigate the ‘disastrous’ £4.6bn Net Zero plan feared will leave thousands of homes unsafe.

In a scathing report, MPs criticized the Government’s failed insulation scheme which left more than 30,000 properties defective.

The Commons public accounts committee (PAC) described the home renovation scheme as ‘the most disastrous fiasco’ and found fraud likely played a significant role.

The committee warned that some of the defects posed ‘immediate health and safety risks’ and called on the Government to refer the matter to the Serious Fraud Office (SFO).

MPs on the committee also took aim at Ed Miliband’s Department for Energy Security and Net Zero (DESNZ), saying it took two years for senior officials to realize the extent of the problem.

It is estimated that more than £4.6bn has been spent under two home energy saving schemes: the Energy Company Obligation (ECO) scheme and the Great Britain Insulation scheme.

The cost is covered by energy suppliers, but is passed on to consumers as higher bills. Despite the huge costs, the plans were derailed by poor installation.

The ECO scheme, which was intended to improve energy efficiency and reduce bills, has instead left 32,000 to 35,000 homes with faulty insulation. In some cases, this has caused structural problems, dampness and mold growth.

MPs have warned that fraud is likely to have played a significant role in the poor quality of insulation. Energy regulator Ofgem found a fraud rate of 1.75 per cent of work done; This equates to more than £80 million. But MPs said that figure was likely a ‘significant underestimation’.

PAC chairman Sir Geoffrey Clifton-Brown described the failure of the ECO as the ‘most disastrous fiasco’ he had seen in his 12 years on the committee.

He said: ‘Potentially thousands of people are currently living with health and safety risks in their homes and, despite the Government’s objections, we have no adequate assurance that they will not incur financially unaffordable bills to repair defective work.’

Ministers said no home should have to pay to fix problems, with the first installer having to pay up to £20,000 in foot costs under warranty.

But the PAC report warned that households have no real assurance that repair costs will be covered if they exceed this limit.

The diverse group was skeptical that original installers and warranty providers would be able to survive the scale of potential claims, citing cases where damage had been in excess of £250,000.

Minister for Energy Consumers Martin McCluskey said: ‘Under these two schemes every home with external wall insulation is inspected at no cost to the consumer.’

A DESNZ spokesperson said: ‘It is simply not true that there are widespread health and safety risks; For the vast majority this means a home may not be as energy efficient as it should be.’