Government’s Green Homes Grant a 'wasted opportunity'

A recent National Audit Office report has revealed the Government’s mismanagement of its Green Homes Grant Voucher Scheme, with the scheme being implemented on an ‘overly ambitious’ timeline. The Green Party has slammed the Government’s handling of the scheme, which it says was 'totally mismanaged'.

An assorted series of houses

Photo by Toa Heftiba on Unsplash

Green World

The Green Party has condemned the Government’s mismanagement of the Green Homes Grant Voucher Scheme, after a National Audit Office (NAO) report identifies that it has significantly underdelivered on new energy efficiency home installations and creation of Green jobs. 

A key component of both Boris Johnson’s pledge to ‘build back greener’, and the Government’s bid to decarbonise home heating, the scheme aimed to support 82,500 jobs over six months and enable up to 600,000 households to save up to £600 on their energy bills. However, the NAO’s recent report reveals that this was delivered to an ‘overly ambitious’ timeline. As a result, the scheme was delivered inefficiently, with the report stating that this was ‘significantly limited’ job creation and carbon reduction.

Amelia Womack, Deputy Leader, said: "News that the Green Homes Grant Voucher Scheme has been a failure comes as no surprise and yet again demonstrates the government’s total lack of commitment to substantive action on the climate crisis.

"Decarbonising home heating is a key part of reaching net-zero - even the government has managed to identify that. But here we have a scheme that was supposed to contribute to that goal while also delivering energy savings for hundreds of thousands of households and more than eighty thousand jobs, and it’s been totally mismanaged.

"A wasted opportunity doesn’t even begin to cover it!"

Zoe Nicholson, Green New Deal spokesperson, added: “People are really on board with taking steps that will help reach net-zero so it’s so disappointing that this mishmash of schemes hasn’t been easy for householders to engage with. For a genuinely Green recovery from Covid, local authorities need to be given the proper funding and support to play a significant role in decarbonisation - making it a priority in both the public and private sectors."

Running between September 2020 and March 2021, the scheme offered homeowners £5,000 funding, or £10,000 for low-income households, for the installation of energy improvements. However, due to the short timeframe, just 47,500 installations are expected to be made through the scheme, creating only 5,600 jobs over 12 months. Of the £1.5 billion funding available, only £314 million is expected to be used, with £1,000 per home upgraded going to administration fees. 

The report outlines the poor experience of many homeowners and installers involved in the scheme, highlighting issues such as delays in issuing vouchers and paying installers, and a complicated application process. From October 2020 to April 2021, a reported 3,000 complaints were made to the scheme administrator and the Department for Business, Energy and Industrial Strategy (The Department).

The NAO places blame on The Department for implementing such a short timeline, whilst it was also supporting vaccine procurement, and undertaking activities related to Brexit, justified by the ‘need to support businesses in the wake of the COVID-19 pandemic.’ The report states that the Department did not ‘learn from its own previous energy schemes’, failing to understand the challenges facing installers or evaluate stakeholder views. 

Installers were reportedly only consulted once the scheme was announced, limiting the opportunities to include installer views in the scheme design. The cost of installer accreditation and the short duration of the scheme when it was first announced, the report says, deterred some installers from participating.

Focusing on measures that would provide the biggest impact on reducing carbon, such as insulation and low-carbon heat installations, the Department failed to manage the tension between long-term carbon reduction and short-term job creation, the report says. The chosen techniques required specialist skills to install, meaning that installations were delayed whilst employers recruited and trained staff.

The NAO asserts that jobs could have been created ‘more quickly’ in areas that require fewer specialist skills, such as window and door installation. The initial timeline, which was proposed as two years, would have allowed more time for jobs to be created, but this was rejected by HM Treasury.

Choosing to proceed to the amended timetable, the Department attempted to implement the required digital voucher installation system, despite the firms that bid for the grant administration contract stating that this was not possible within the timeframe. By March 2021, the digital system was still not in place, resulting in a growing backlog of applications due to the use of manual processing. 

Reasoning that insufficient improvement had been made, the Department decided to close the scheme in March 2021.

The NAO report recommends that the Government 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. Additionally, it states, the requirements placed on homeowners and installers for such schemes should be tested from the start, with the aim of simplifying administration.

Gareth Davies, Head of the NAO, commented: “The aim to achieve immediate economic stimulus through the Green Homes Grant voucher scheme meant that it was rushed. As a result, its benefits for carbon reduction were significantly reduced and ultimately, it did not create the number of jobs that the 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."