Home Insulation

Mark Hendrick Excerpts

Wednesday 24th October 2018 Commons Chamber

[Sir Mark Hendrick (Preston) (Lab/Co-op)]

I rise to bring to the Government’s attention their approach to detrimental home insulation issues. I am pleased to have secured the debate to talk about the terrible conditions suffered by some of my constituents who live in the Fishwick area of Preston. The source of their complaints is work first carried out between January and June 2013.

The work was a Government scheme aimed at improving the thermal efficiency of homes by providing wall insulation. The aim, of course, was to lower heating bills in properties where many people were likely to be suffering from fuel poverty. The Fishwick area is one of the poorer areas of the city of Preston and the success of this scheme should have been very important to improve the lives of these people. The funding for this scheme was secured in September 2012 from InterGen, the managing agent for the scheme was Anesco, and the contractor for the scheme was called Ecogen. In total, 387 properties in Fishwick had work carried out as part of this scheme.

As I said earlier, the work was completed in June 2013, and in October that year, tragically, Ecogen was liquidated. By December 2013, the complaints started to flood in. By January 2014, the complaints were referred to the managing agent, Anesco. By March 2014, the complaints were referred to Ofgem.

Between March and December 2014, Ofgem undertook an investigation into the scheme. In December 2014, Ofgem decided to issue an enforcement order to have the work rectified. By April 2015, independent surveys were carried out by the energy partnership with a view to rectifying the work. By August 2015 a second set of independent surveys were carried out and, at the same time, the entire scheme was referred to what was then the Department of Energy and Climate Change. This was complemented by the Bonfield review, which was launched in 2015 by DECC in the wake of the failure of the green deal. The purpose of the review was to examine and make recommendations about how consumers can be protected and advised when installing energy efficiency and renewable energy measures in their homes.

By this time, of course, it was clear that the residents of the 387 homes in the Fishwick area had been living in substandard conditions for three years, with properties suffering from damp, fungus and mushroom development on the walls at various times throughout the year. They were living in extreme humidity because of the way in which the cladding attached to the building had contained water and allowed it to accumulate for long periods inside the building. Quite apart from the humidity and smell being extremely uncomfortable for the residents, it was also a health hazard that resulted in complaints of illness from various residents of the properties.

On 5 February 2016, I was made aware of these problems for the first time at a public meeting held at the Sahara community centre in Fishwick, following which I emailed the right hon. Member for Hastings and Rye (Amber Rudd), who was then the Secretary of State at DECC, to ask her to make funding available as a matter of urgency as well as an emergency fund to deal with water ingress. I then received a response from the noble Lord Bourne, who said in his letter of 17 March 2016 that in such cases complaints should be referred to a local citizens advice bureau or Ofgem. It is understandable that Ofgem should be involved, but how on earth can the citizens advice bureau help? It was clear from my letter to the Secretary of State and the attachment that the contractor, Ecogen, had been liquidated and it was therefore not just a simple case of going back to the contractor and getting them to put the work right. Special help was required to help put right the defective work.

As a result of my persistence, in early June 2016, I received an email from the National Energy Action fuel poverty charity that stated that a total pot of £2.5 million could be made available to Preston City Council to assist people trapped in the scheme if Preston City Council was prepared to take on the role of managing the remedial work. Unfortunately, the NEA had to contact me on the matter because it had yet to receive any response from the city council. I later found out that one of the council officers had sat on the letter from the NEA and not referred the matter to either the chief executive at the time, Lorraine Norris, or the councillors for the Fishwick ward. I believe that this was because the council officer concerned was reluctant to take on the role of managing the remedial work and therefore did not pass on the correspondence from the fuel poverty charity.

[Jim Shannon (Strangford) (DUP)]

The hon. Gentleman is raising a specific point about his constituency, but I want to refer briefly if I may to Northern Ireland, where the fuel poverty figures have dropped by some 22%. That is in no small part due to the Northern Ireland sustainable energy programme, or NISEP, which ring-fences some 80% of funding specifically to help vulnerable and low-income families install efficiency measures in their homes. Does the hon. Gentleman agree that working alongside housing associations in Northern Ireland and with NISEP would be something the Minister could consider and an excellent way of ensuring that vulnerable people could install efficiency measures in their own homes and get the help to which he is referring?

[Sir Mark Hendrick]

I concur with the hon. Gentleman. Whether it is with Northern Ireland authorities or with our own Government, there is no reason why there should not be good co-operation and good insulation schemes. That is what I would have expected with these 387 houses in my constituency.

In the meantime, I requested a meeting with the Secretary of State on the matter, as a matter of urgency. Except for a very brief encounter in the House of Commons Tea Room, when the Secretary of State said that she was looking into the matter as she passed me by, she seemed uninterested in the case and reluctant to discuss the matter. She did, however, refer me to an official, who then assured me that Preston City Council was working with the NEA fuel poverty charity. However, what the Department did not know was that this was the case only because of my direct intervention and contact with the chief executive of Preston City Council at the time, because, as I said earlier, the council officer had sat on the letter from the NEA.

By July 2016, the chief executive was indicating that she needed extra funding in order to carry out surveys to get a “detailed picture of issues”, so clearly the £2.5 million was not enough to deal with the problems, and in fact was only to be targeted at those homes which had complained about the work—62 of the 387 homes. That did not take account of the fact that many of the other homes had problems, but because the residents thought that people in other properties were complaining on their behalf as well, they did not come forward and make their direct complaints. Therefore, the fact that work was to be carried out on the 62 properties only, neglected all the work that needed to be carried out on the other affected properties, whose residents, for a variety of reasons, had not come forward and made their own complaints. That was, in my view, totally unjust and short-sighted.

On 24 November 2016, I emailed the Secretary of State at the Department for Business, Innovation and Skills—the right hon. Member for Tunbridge Wells (Greg Clark)—to ask what assurances and safeguards were in place to ensure that the properties would be safe, dry and warm, and that any installations would be done in a professional manner. In December 2016, BIS responded, asking for more detail. In January 2017, my office contacted BIS to ask what detail it required. My office staff were told that the policy team would get in touch. We waited and waited, and the policy team did not get in touch. However, work was already under way on the 62 properties, which were designated as phase 1. Those properties that were left were designated as phase 2 and the residents were told that they would be surveyed. However, there was no indication from any organisation as to how or if funding would be made available for phase 2.

In the meantime, I received an email from Councillor Martyn Rawlinson of Preston City Council, telling me that the management of the repairs on the 62 houses was as bad as the original work that was carried out. Some of the houses had been left half done for several months. E.ON originally said that all repairs necessary would be done, but E.ON was then saying that homeowners should get their own insurers to get the work completed, which was outrageous—an absolute disgrace—and by then the residents had been putting up with this nonsense for four years, with many of them having work done twice to their property, and still not to their satisfaction.

By 29 November 2017, I was ready to let E.ON know about my concerns over the progression of the remedial works, and asked it for a timescale setting out when all the works would be carried out and completed, and for a point of contact to be established for the residents. My office chased E.ON for a response for over a month, and a month later—January 2018—we finally received correspondence. E.ON confirmed that it was trying to divert attention from its responsibilities in the matter towards Preston City Council, which had no direct responsibility, and still has no direct responsibility, for the work to be carried out. It is E.ON that surveyed the houses in August 2017 for phase 2 of the repairs. I am told that those so-called “surveys” were in fact not proper surveys, but door-knocking exercises to ask people whether they were having problems, or had had problems previously; nothing at all was done of a technical nature, and certainly nothing that could generate a work order to remedy what problems they were having. In addition there is not, and has not been, any indication from the Government or E.ON of how the rest of the work for the 300-plus houses will be financed. We are seeing good will, but nothing in the way of resources to complete the work.

On 11 February I received an email from Councillor Martyn Rawlinson, with photographs of some horrific scenes within houses due to the damp issues. It is inconceivable that people should be left to live in such conditions, with no one apparently willing to rectify the problems as soon as possible.

On 8 March this year, I wrote to the Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for South Derbyshire (Mrs Wheeler), describing my disappointment with the then Secretary of State and the Department, and appealing for help. On 27 March I received a response from the Under-Secretary telling me that the responsibility had moved from her Department to the Department for Business, Energy and Industrial Strategy.

I tabled a series of parliamentary questions to BEIS about the use of cladding on properties. That culminated in a letter from BEIS indicating that remedial work on 62 of the properties should be completed shortly, and that E-ON was in discussions with National Energy Action to help other households. In the meantime I received a variety of complaints from the residents, one claiming to have spent £1,500 after a ceiling caved in after wet weather. In a separate case, an elderly homeowner had to leave her property and move in with her son because the damp was affecting her health.

Since then, the Minister for Energy and Clean Growth has responded to my parliamentary question, PQ177184, indicating that the retrofit on 62 of the properties was completed in the summer of this year and that work has been carried out to estimate the extent of the work that is necessary to sort out the work required to the other properties. As I said earlier, that resulted in questions being asked on the doorstep. In addition, talks have been taking place between Ofgem, BEIS and the energy suppliers in an attempt to secure funding for the remaining houses.

This saga has been running for six years, from 2012 to where we are now, in October 2018. It has been an absolute tragedy for those living in those 387 houses, who have been trying to put up with substandard housing and great inconvenience. The result has been unsafe properties with associated health risks. In the meantime, I am reliably informed that in many cases the cladding has been removed, but properties have been left with holes in the walls. The landlord has said that they will be finishing off the work, but will only repair the holes and paint the brickwork. They are not prepared to install any new insulation. One of the complainants wonders where the money has gone for the work that should have been done to her property. The landlord has told her that she should speak to E.ON or Preston City Council.

Let me tell the Minister that I recall spending three years in the Department for Environment, Food and Rural Affairs as Parliamentary Private Secretary to the then Environment Secretary, the right hon. Member for Derby South (Margaret Beckett). During that time, when my party was in government, we dealt with fuel poverty issues through the Warm Front scheme, which was applied to about 10,000 homes in my constituency, particularly in the area of Deepdale. The scheme focused on energy efficiency by installing new central heating boilers and providing loft insulation and double glazing for terraced housing that was not too different from the housing that we see in Fishwick ward. It was extremely effective, and popular with residents.

May I ask the Minister why the more recent schemes that are using cladding of the type mentioned in Fishwick are being employed when the detriment to both property and residents is known? Why has it taken six years to get to where we are now for the residents of Fishwick? Are the Government willing to help to direct the residents to a satisfactory and available source of finance to rescue what is, in fact, a Government scheme?

[Mr Jim Cunningham (Coventry South) (Lab)]

I was in that Department during the period of the last Labour Government. One of the things that is absent here is enforcement, but, more important, if there is a Government scheme and the Government are subsidising it, there should be a list of approved quality builders, perhaps with certifications. I have also found, in isolated cases with which I have dealt, that it is mainly elderly people who cannot get redress. They are told to go to the council, but the trading standards offices are undermanned, and they have limited powers under the law. Should we not do something about some of those matters?

[Sir Mark Hendrick]

I agree with my hon. Friend. When I was in DEFRA there were recommended contractors. Those contractors could ensure a certain level of quality and even though we got the odd complaint from people under the Warm Front scheme, we did not get anything like the number of complaints or the state of the work that we get now. Unfortunately, the company in question has gone into liquidation, but the Government should still look at how they can help.

Why have the residents of Fishwick had to endure this substandard work and why has it not been rectified properly despite the fact that the contracting company, Ecogen, went into liquidation soon after that work was completed? Why do the Government not concentrate on energy-efficient boilers, loft insulation and double glazing? The Minister might well tell me that in other areas they are concentrating on those solutions, but then why is there this move towards cladding—an ugly and harmful solution?

I am thankful for securing this debate and look forward to hearing the answers to my questions from the Minister.

[The Minister for Energy and Clean Growth (Claire Perry)]

I am genuinely interested to hear the comments of the hon. Member for Preston (Sir Mark Hendrick) tonight. The points he makes about damp living conditions and the impact that has on people’s health and whether their homes are fit for purpose also apply in my constituency and are of enormous importance.

I will start by saying that I do not think that what has happened has been good enough. I will also say something that I will repeat at the end of my speech, which is that I am going to instruct one person in my Department to act as the broker and bring together all the people who have played a part in the problem and can also be part of the solution. I hope that that reassures the hon. Gentleman. I am also going to take a moment to set out where the issues the hon. Gentleman raised about this scheme are being addressed fully in the latest iteration of the schemes we are using to help people living in fuel poverty—the ECO3 scheme.

As the hon. Gentleman will know, the scheme he is referring to in his constituency was the community energy saving programme, or CESP, which was set up by the previous Labour Government. All the shortcomings of that scheme—no guarantee and no list of installers—were a function of the scheme design at that time. That is one reason why that scheme was closed by the coalition Government in 2012, and a number of penalties were issued for companies under that scheme because, as the hon. Gentleman’s constituents well know, it had not delivered what had been required both in terms of the carbon savings and the quality of work.

Fishwick was then part of this mitigation activity that was undertaken by InterGen. I totally agree that solid wall insulation is not a suitable way to reduce energy consumption in many homes in the country, but that was part of InterGen’s mitigation scheme. As the hon. Gentleman knows only too well—it is one of the reasons why he is a long-standing champion in this place—this issue has been going on for many years. There were problems as a result of those installations. Ofgem then received complaints from 62 households, although I know the complaints pool is much larger. Those were offered remedial work which was delivered by E.ON. But as the hon. Gentleman also knows, there are real concerns about the quality of that work, because, as he said, it is not good enough to rip the cladding off and leave holes in the wall; people expect to have a warm home that can breathe and is fit to live in.

I understand that E.ON provided some additional funding to carry out the necessary structural work. I am told it carried out full structural surveys, but if the hon. Gentleman is telling me that that was not the case, that is certainly something to investigate further. Some homeowners of course declined to have extra work; there were issues gaining entry and so forth. If full surveys were not carried out, we need to know that, which is why I am keen that we have one point of contact in my Department to get to the truth of the matter.

Since that work was undertaken in the summer of 2017, more complaints have emerged—over 180. As the hon. Gentleman set out, the installer no longer exists. We are insisting on appropriate guarantees through ECO, but the Fishwick homes, which are a strong failure of the scheme put in place by that Labour Government, did not have any guarantees required from any installer, and the Solid Wall Insulation Guarantee Agency now set up to be a backstop did not exist at the time.

[Sir Mark Hendrick]

I fully take what the Minister is saying to be correct, but I would have expected the guarantees and quality of work that we saw in the Warm Front programme to be carried over into this scheme if it was indeed put together by the Labour Government prior to the coalition. I am very surprised to hear that that was not the case, but obviously I believe what the Minister says.

[Claire Perry]

The great thing about these debates is that we do not have to focus too much on the politics, but the hon. Gentleman is right to say that some very good designs and functions were put in place under the warm home scheme, and they have very much influenced the design of the energy company obligation, which is the replacement for CESP.

Perhaps I can give the hon. Gentleman some comfort in relation to other constituents who are receiving measures under this scheme by telling him that the design flaws have been addressed. We have worked with the British Standards Institution to develop new standards over and above building regulations standards for any eco-obligation, and any installer that wants to be part of the scheme must meet those technical standards. All solid and cavity wall installations must be accompanied by a guarantee that gives financial assurance even if the company providing the guarantee cannot honour it. There has to be a bond in place to provide sufficient coverage of at least 25 years, including full replacement or remediation, and to provide a verified quality assurance tick, which we would expect our constituents to be able to rely on in terms of the quality of the work and the products that are being installed.

In July 2015, we commissioned the “Each Home Counts” review. This has been a further key driver of developments in this area. The hon. Gentleman might also have heard of the TrustMark scheme that I launched last week during Green Great Britain week. It sets out a clear code of conduct for businesses. He might also receive complaints, as I do, about cold calling and the aggressive selling of these products, which are completely unacceptable. A process guarantee and rigorous new technical standards to tackle poor design and installation will be published next spring. I entirely agree with him that robust monitoring is key, and enforcement activities are the way to ensure that this happens.

I want to bring comfort to the hon. Gentleman’s constituents, but I know that it is no comfort to learn that some of the failings in the scheme design of 2009 that have caused such problems for them have given us lessons from which we have learned. I was pleased this week to bring forward the next set of measures to support ECO3. It will now be focused 100% on the alleviation of fuel poverty right across the UK, and I hope that some of his constituents will benefit from that.

--- Later in debate ---

[Sir Mark Hendrick]

Just before the Minister finishes, will she address the matter of finance for the remaining homes and whether the Government can be of any assistance?

[Claire Perry]

The hon. Gentleman anticipates my final remarks. I am fully sympathetic towards what he said, and I am sorry that he has been given the runaround over the years, because he has been doughty in raising such points. There is such a complex array of people involved. He referenced Preston City Council, and I am disappointed that it has been less than active historically, particularly in working with some of the agencies with which he has set up relationships. It sounds as though InterGen, E.ON and Ofgem also need to be corralled into a place where we can come up with a solution.

The scheme’s design, under which insulation is independently installed, never included a backstop to Government finance, although the hon. Gentleman may say that that ought to be a requirement. I therefore do not have any money in any of my budgets to meet the funding requirements, but given that many of the companies are still in operation and will still want to work during the scheme—the market for them is substantial—I feel strongly that they ought to do the right thing and work out ways to fix the problems and ensure that residents are happy.

I will write to the hon. Gentleman shortly with the name and contact details of a person in my Department whom I will task with bringing things together and who will report back to me with progress on a regular basis. I am happy to discuss that progress with the hon. Gentleman, either in the Tea Room or more formally. Lessons have been learned, although I appreciate that that is no comfort for residents who have been bedevilled with problems, but we can work together to try to sort things out.

Question put and agreed to.