The spending watchdog has today (8th September) reported that the scheme was delivered to an over-ambitious timetable and was not executed to an acceptable standard, significantly limiting its impact on job creation and carbon reduction.
HM Treasury gave the Department for Business, Energy & Industrial Strategy a 12-week timescale to design the scheme, consult with stakeholders and procure an administrator — during a time when it was supporting vaccine procurement and undertaking activities related to the EU exit.
According to the government, the scheme was introduced to provide a short-term economic boost while tackling its contribution to climate change as we emerged from the Covid-19 pandemic.
It offered homeowners up to £5,000 funding, or £10,000 for low-income households, for the installation of energy-efficient improvements.
The department originally expected the scheme to support up to 82,500 jobs over six months and enable up to 600,000 households to save up to £600 on their energy bills.
However, only about 47,500 homes are expected to receive grants, and up to 5,600 jobs are forecast to be created over 12 months.
The department estimates that it will spend £314m of the £1.5bn funding available, £50.5m of which is on administration costs.
The NAO’s report stated that many homeowners and installers had a “poor experience” using the scheme, and there were delays issuing vouchers to homeowners and paying installers, causing frustration.
From October 2020 to April 2021, over 3,000 complaints were made to the department and the scheme administrator.
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“The aim to achieve immediate economic stimulus through the Green Homes Grant voucher scheme meant that it was rushed,” stated NAO head, Gareth Davies.
“As a result, its benefits for carbon reduction were significantly reduced and, ultimately, it did not create the number of jobs government had hoped for.
“Decarbonising our homes is a key element of the government’s net zero strategy; it is vital that future schemes learn from this experience.”
The report found that the department did not sufficiently understand the challenges facing installers, and chose to proceed to its timetable, even though none of the firms that bid for the grant administration contract thought it was possible to fully implement the required digital voucher application system in the time available.
The NAO has recommended that the department should engage properly with the supplier market for future decarbonisation schemes and base its planning on a realistic assessment of how long it will take the market to mobilise.
Ross Counsell, chartered surveyor and director at GoodMove, said that while the scheme was clearly made with good intentions, it can be seen as another idealistic government scheme that hasn’t worked out.
“What we see is an industry trying to bounce back from the strain Covid-19 restrictions put on international imports of materials, and the government clearly has not factored this in when announcing the scheme,” he added.
“Hopefully, the government will think more thoroughly about future green schemes so that, as a country, we can collectively work towards creating more sustainable homes and a more sustainable society.”