Recommendations & Conclusions
5 items
3
Recommendation
Twenty-Seventh Report - Green Homes Gra…
Not Addressed
The Scheme’s design was overly complex and did not sufficiently address the needs of consumers and installers. The Department acknowledges that consumers and installers faced a poor customer experience when using the Scheme. There were delays to applications being processed, and by August 2021, 52% of voucher applications were eventually …
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The Scheme’s design was overly complex and did not sufficiently address the needs of consumers and installers. The Department acknowledges that consumers and installers faced a poor customer experience when using the Scheme. There were delays to applications being processed, and by August 2021, 52% of voucher applications were eventually rejected or withdrawn, while 46% of installer applications failed. These high attrition rates were substantially the result of the Scheme’s complex design, with applications having to meet complicated requirements to be approved. Homeowners also struggled to find registered installers as many installers were unwilling to gain the necessary certification for a scheme lasting only six months. The Department should have consulted more deeply to understand the challenges that consumers and industry would face, and how it might address barriers to participation. The final administration costs are expected to be just over £50 million, 16% of the total Scheme spend, amounting to more than £1,000 per home upgraded. The Department states that these high costs were due to the need to account for the failings of the Scheme administrator, even though this figure includes a reduction of the contractor’s fee for their poor performance. A scheme of less complexity would have had administration costs more proportionate to the number of successful voucher applications. Recommendation: The Department should set out what steps it is taking to: • secure meaningful engagement with potential consumers in the design of new programmes and minimise the risk that the scheme design proves to be unworkable; • ensure that the costs of administration are proportionate to the delivery of outcomes and the amount of public money at stake.
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Government response AI summary
The government's response addresses civil service skills shortages and efficiency savings, but does not provide details on steps taken to secure meaningful consumer engagement or ensure proportionate administration costs in new programmes, as recommended.
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HM Treasury
4
Recommendation
Twenty-Seventh Report - Green Homes Gra…
Not Addressed
The creation of jobs was a priority for the Scheme, but the Department failed to maximise its impact on employment. The Scheme’s objectives of creating jobs and reducing carbon emissions were at times conflicting. The Department chose to prioritise measures under the Scheme which promised higher carbon savings. However, this …
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The creation of jobs was a priority for the Scheme, but the Department failed to maximise its impact on employment. The Scheme’s objectives of creating jobs and reducing carbon emissions were at times conflicting. The Department chose to prioritise measures under the Scheme which promised higher carbon savings. However, this limited the number of jobs that could be created, as often energy Green Homes Grant Voucher Scheme 7 efficiency measures which required skills that were quicker for installers to recruit and train, or where there were larger supply chains, were not as accessible under the Scheme. Heat Pump installations, for example, were encouraged under the six- month Scheme but it can take much longer than that just to learn how to install them. The Department originally envisaged that the Scheme would support up to 82,500 jobs over 6 months, but its modelling now indicates that the Scheme will have supported 5,600 jobs over 12 months. We are sceptical whether these modelled figures are accurate, as they are not based on concrete evidence of the actual number of jobs supported, and also do not take into account the negative effects reported by installers from the Scheme’s sudden closure. The Department is confident that installers were able to find work through its other energy efficiency schemes once the Scheme closed, however evidence submitted by industry indicates that these schemes were often not accessible to smaller installation companies, and some firms had to make staff redundant as a result of the Scheme’s difficulties and its abrupt closure. Recommendations: In planning and implementing the new Boiler Upgrade Scheme, the Department should engage closely with potential suppliers to properly understand the challenges they may face to scale up, including training sufficient numbers of appropriately skilled workers, and ensure the availability of suppliers across the country. If the Department sets an objective to create jobs it should put in place rob
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Government response AI summary
The government's response quotes a general PAC conclusion about tracking benefits and costs, completely failing to address the specific recommendation for the Department to engage with suppliers and address scaling challenges for the new Boiler Upgrade Scheme.
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HM Treasury
5
Recommendation
Twenty-Seventh Report - Green Homes Gra…
Not Addressed
The Department appointed a contractor without properly understanding whether it could deliver. The Department undertook a rapid procurement for a grant administrator, who would develop a digital voucher application system for the Scheme. None of the bidders for the contract thought it was possible to fully implement a digital system …
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The Department appointed a contractor without properly understanding whether it could deliver. The Department undertook a rapid procurement for a grant administrator, who would develop a digital voucher application system for the Scheme. None of the bidders for the contract thought it was possible to fully implement a digital system in time for the launch, and so the Department launched a complex scheme without an IT platform that had been fully developed and tested. The Department’s chosen grant administrator, ICF Consulting Services Ltd (ICF), subsequently struggled to implement the voucher application system, leading to greater amounts of manual processing being needed for applications, contributing to the delays in processing vouchers. The Department felt its procurement process was run successfully overall, despite appointing a contractor which could not deliver the system it wanted. Whereas other bidders thought fully implementing a system would take at least 15 weeks, ICF thought it could do it in six and a half weeks. It was unclear why the Department did not challenge ICF further as to why it felt it could deliver substantially faster than the other bidders. The Department recognised it should have had a better technical understanding of ICF’s proposed digital solution, which could have prevented some of the issues experienced subsequently. This was despite a specialist Cabinet Office review of the low-cost bid recommending the Department obtain a more detailed understanding of the proposed solution, which the Department did not do. 8 Green Homes Grant Voucher Scheme Recommendation: In its Treasury Minute response, the Department should set out how it will improve the technical scrutiny of bids during its procurements, to better assure the capability of suppliers and the practical feasibility of their proposals, particularly where a bidder is promising considerably more than others.
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Government response AI summary
The government's response cites a general PAC conclusion about government efficiency drives, failing to address the specific recommendation for the Department to outline how it will improve technical scrutiny of bids during procurements.
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HM Treasury
6
Recommendation
Twenty-Seventh Report - Green Homes Gra…
Not Addressed
The Department has persistently failed to learn lessons from previous energy efficiency schemes. The Committee has seen a number of domestic energy efficiency schemes which have failed to achieve their ambitions, including the Green Deal and the Renewable Heat Incentive. These both featured poor uptake by consumers due to their …
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The Department has persistently failed to learn lessons from previous energy efficiency schemes. The Committee has seen a number of domestic energy efficiency schemes which have failed to achieve their ambitions, including the Green Deal and the Renewable Heat Incentive. These both featured poor uptake by consumers due to their complex scheme design, and the Green Deal scheme also carried a disproportionately high administrative cost per home upgraded. The Department stated that the design of the Green Homes Grant Voucher Scheme did reflect lessons from previous schemes, particularly in its attempt to ensure value for money in delivering carbon impacts whilst minimising poor quality workmanship and fraud. Nonetheless, we are concerned that despite the Department retaining personnel with experience of previous initiatives, the Green Homes Grant Voucher Scheme suffered from many of the same issues that we have seen before. This calls into question how the Department maintains and uses its corporate memory, and whether it is truly learning lessons from the delivery of these schemes. Recommendation: The Department should set out in its Treasury Minute response how it is embedding lessons learned from this scheme and previous schemes, and how it will ensure these are applied to future energy efficiency initiatives. Green Homes Grant Voucher Scheme 9 1 Scheme design and performance
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Government response AI summary
The government's response refers to a general PAC conclusion about civil service capacity during emergencies and does not address the specific recommendation on embedding lessons learned from energy efficiency schemes.
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HM Treasury
1
Conclusion
Twenty-Seventh Report - Green Homes Gra…
Not Addressed
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department of Business, Energy and Industrial Strategy (the Department) about the Green Homes Grant Voucher Scheme. The government aims to achieve net zero carbon emissions by 2050. Buildings account for around 19% of …
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On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department of Business, Energy and Industrial Strategy (the Department) about the Green Homes Grant Voucher Scheme. The government aims to achieve net zero carbon emissions by 2050. Buildings account for around 19% of all UK greenhouse gas emissions.1 To reduce emissions from homes the government wants consumers to use less energy, make greater use of green heating systems (alternatives to gas and fossil fuels) and for home heating to be more efficient. The Department has overall responsibility across government for achieving net zero, and it and its predecessor, the Department for Energy and Climate Change, have been responsible for a number of home energy efficiency schemes, such as the Green Deal, the Energy Company Obligation, the Renewable Heat Incentive and the Warm Front Scheme. These schemes have addressed different groups of energy consumers, over different periods of time.2
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Government response AI summary
The government's response references a general PAC conclusion about 'cost shunting,' which does not address the committee's specific background information and context provided in conclusion #1 regarding the Green Homes Grant Voucher Scheme.
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HM Treasury