MPs ask Serious Fraud Office to investigate UK home insulation sector | Energy efficiency
After months of disruption that left thousands of homeowners with their homes destroyed, huge financial losses and the “clear and catastrophic failure” of two Conservative government plans, MPs have called for the Serious Fraud Office to investigate the home insulation industry in the UK.
More than 30,000 households had defects, some serious, including mould, water intrusion and damage to the structure of walls; Approximately 3,000 residences were so severely damaged that they posed immediate health and safety risks to their residents.
Households with approximately 23,000 exterior cladding installations experienced the greatest damage, with 98% of homes damaged and needing repair, and 29% of homes with interior wall insulation.
Schemes called Eco4 and the Great Britain Insulation Plan were launched and mostly carried out under the last Conservative government. The extensive energy company liability that both plans were part of has since been canceled by Labor, and a new initiative (the warm homes scheme announced this week) will take over and fund insulation as well as the installation of solar panels and heat pumps.
One Report on the scandal released on FridayThe public accounts committee of MPs has recommended an investigation into Eco4 by the Serious Fraud Office and an overhaul of the government’s handling of home insulation. Committee chairman Geoffrey Clifton-Brown said: “[This] This amounts to the most disastrous fiasco I have ever seen in this committee. “The project was doomed to failure from the very beginning.”
He blamed the operation of the scheme, the sharing of responsibility among various organizations that failed to communicate effectively, and a failure to act when problems began to arise.
Clifton-Brown said: “Potentially thousands of people are 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 unaffordable bills to repair defective works. Given what has happened, public confidence in retrofitting plans will rightly have been shaken.”
MPs said Eco4 had led to “the worst failure rate we have seen in the chairman’s nearly 12 years on the committee” and accused the Department of Energy Security and Net Zero and other government agencies of being “too slow to act”.
Labor now faces additional bills to repair the homes of those affected. Despite the “find and repair” strategy, only about 3,000 homes had been repaired by last October, when the National Audit Office examined the problem. Jonathan Bean, a spokesman for the charity Fuel Poverty Action, said: “Ministers need to focus on repairing already damaged homes and ending the suffering of the tens of thousands of often vulnerable people living in them. Victims of failed renovations are fed up with vague promises; what they want is a public inquiry into this scandal and a guarantee that their homes will be repaired.”
Under the Eco4 scheme, vulnerable people and those on low incomes were required to receive subsidized home insulation, paid for through top-ups to everyone’s energy bills.
The work done by insulation companies should have been covered under warranty, but some companies have since closed and homeowners have been forced to scramble to recover the damage. The committee found one case where repairs cost more than £250,000; but most bills were much lower, from £250 to £18,000.
The government has also reduced the heat pump installation target in its warm homes scheme from 600,000 to 450,000 per year. One expert told the Guardian this could put the UK off track to meet statutory carbon emissions reduction targets.
The government rejected this conclusion. A spokesman said: “We have set a fully achievable target for heat pump installations, supported by the necessary funding and enabling policies. We will set our seventh carbon budget by June 2026, in line with our statutory duties.”
