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Green Homes Grant: £1bn of funding to be scrapped

Critics slam ‘outrageous’ decision not to roll over unspent cash in government scheme

The government is quietly planning to withdraw £1bn in funding from its Green Homes scheme less than six months after rolling out the flagship programme, a minister has admitted. 

A total of £1.5bn was set aside to help homeowners in England “improve the energy efficiency” of their property as part of a push to “stimulate a green jobs revolution”, with a further £500m intended for use by local authorities, as the Daily Mail reports. 

The gov.uk website says that “if you’re a homeowner or residential landlord, you can apply for a Green Homes Grant voucher towards the cost of installing energy efficient improvements to your home”, with the state footing two-thirds of the bill for eligible improvements up to a maximum of £5,000.

But according to The Guardian, 95% of the £1.5bn pot provided for householders to make their homes less carbon intensive remains unspent following the launch of the scheme last September, “due to long delays in giving out grants to householders and making payments to installers”.

Government figures show that as of 22 January, only 17,235 vouchers with a total value of £71.3m had been issued, the paper reports.

And while the application deadline for the grants has been extended to 31 March 2022, business minister Anne-Marie Trevelyan has revealed that the unspent cash from the £2bn total pot will not be rolled over into the next financial year.

Responding to a parliamentary question last week by Labour’s Catherine West,Trevelyan said: “The original funding for the green homes grant voucher scheme was announced as a short-term stimulus, for use in the 2020-21 financial year only.”

Instead, the minister revealed, the government will provide £320m of funding for the scheme for the 2021-22 financial year - “effectively withdrawing hundreds of millions of pounds from the programme”, says The Guardian.

‘Mockery’ of green pledges

Green initiatives are widely viewed as a major potential driver for growth as the UK economy recovers from the triple shock of the Covid-19 pandemic, Brexit and climate change.

ten-point plan for a “green industrial revolution” was unveiled by Boris Johnson in November, when Chancellor Rishi Sunak also presented a spending review that focussed heavily on on green infrastructure and renewable energy use. 

But the decision to withdraw funding from the Green Homes Grant scheme makes a “mockery of the government’s commitments on climate change and a green recovery”, Labour Shadow Business Secretary Ed Miliband has argued.

He added: “It is outrageous that the government is withdrawing funding promised to help insulate people’s homes. They are denying homeowners the energy improvements they need, denying installers the work they need and denying the country the green transition we need.

“To top it all off, it is their own mismanagement of this programme that means only a fraction of this funding looks set to be spent. Ministers must make good on their funding promise and reverse this farcical decision by rolling all the underspend over into 2021.”

Token gesture

Chris Hewett, chief executive of trade association Solar Energy UK, has “accused the government of pulling the rug from underneath consumers and installers”, the Daily Mirror reports. 

Removing the money “would be an alarming early failure of the government’s ten-point plan for a green recovery, transforming a flagship policy into something tokenistic”, he said. 

Meanwhile, the UK Green Building Council’s John Alker said the funding flop marks another government “stop-start” policy.

“The problems with the scheme have not been about consumer appetite, but with the scheme’s administration, with householders having to wait months in some cases, and installers having to wait similar amounts of time to get paid for works done,” Alker added.

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