Sunak set to unveil £2bn home insulation scheme

The Treasury is set to announce that hundreds of thousands of homeowners will receive vouchers of up to £5,000 for energy-saving home improvements, with the poorest getting up to £10,000.

Chancellor Rishi Sunak is expected to use his summer statement on 8 July to set out a £2 billion grant scheme in England for projects such as insulation as part of a wider £3 billion plan to cut emissions. It is believed that the grants could help to support more than 100,000 jobs.

The Treasury has stated ahead of the announcement that the government will pay at least two-thirds of the cost of home improvements that save energy under the Green Homes Grant.

It means, for example, that a homeowner of a semi-detached or end-of-terrace house could install cavity wall and floor insulation for about £4,000, but only pay £1,320 while the government would contribute £2,680.

The scheme will launch in September, with online applications for recommended energy efficiency measures, along with details of accredited local suppliers. Once one of these suppliers has provided a quote and the work is approved, the voucher is issued.

Derek Horrocks, Chairman of the National Insulation Association, said: “The benefits that come from improving the quality of our homes are substantial on any level but particularly now as we come out of the crisis. Jobs have been lost, incomes have dipped and at the same time energy bills have risen because we are spending more time at home. For anyone living in or at risk of being affected by fuel poverty, this is critical – and the best way to tackle the issue is to improve the quality of our homes.

"Providing support to those in need must take priority, but incentivizing the deep street by street retrofits that will be needed to achieve our climate targets will drive uptake in all homes below standard; this makes sense when it can be done at the same time. If we are going to ‘build back better,’ it is now time to turn promises into action. After being hit hard by the pandemic, the industry is ready and waiting to respond to an increase in demand - but the signal of certainty must first come from the government. Once this happens, the sector is ready to go.”

Other measures expected in the statement include: 30,000 new traineeships to get young people in England into work, giving firms £1,000 for each new work experience place they offer; a possible short-term VAT cut for the ailing hospitality industry to help lift demand; and a likely stamp duty holiday, reportedly aimed at first time buyers.

However, regarding energy efficiency, the Chancellor has come under fire for pledging a £1 billion programme to plug energy-leaking buildings, after the party promised £9.2 billion would be spent in its election manifesto.

Rosie Rogers, Greenpeace UK’s head of green recovery, said: “Surely this is just a down payment? Of course this money is better than nothing, but it doesn’t measure up to the economic and environmental crises. It’s not enough to create the hundreds of thousands of new green jobs that are needed.”

The funding is also a fraction of the tens of billions being spent on a green recovery in Germany and France, who are spending £36 billion and £13.5 billion respectively.