HELMS and the Green Deal

Philippa Whitford Excerpts

Tuesday 23rd October 2018 Westminster Hall

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

I beg to move,

That this House has considered home energy and lifestyle management systems and the Green Deal.

It is a pleasure to see you in the Chair, Mr Robertson. Before I start, I should apologise to you and those present: this morning’s speech will be brought to you by Halls Soothers—although other sweets are available—so if I start coughing, please bear with me.

With winter approaching, the extra cost of heating a home will be a concern not only for income-poor families but for many of the Prime Minister’s “just about managing” families. Fuel poverty is still a reality for far too many in society. Unfortunately, many of those households live in energy-inefficient homes. That fact, combined with stagnant incomes and the impact of the Government’s austerity measures, leaves some households vulnerable to increasingly unaffordable energy bills.

To compound that, hundreds of my constituents now have unaffordable and hugely inflated bills thanks to the UK Government’s bungled green deal scheme. The green deal was a flagship scheme intended to give homeowners access to cheap loans to modify and improve home energy efficiency. The loans were to be paid back through monthly energy bills, which were to be cheaper due to the green investment made in people’s homes. That credit, however, was often sold as grant funding to confuse consumers.

The fundamental rule, or “golden rule” as it is known, was and is that the savings on bills should always be equal to or greater than the cost of the work. The idea was that consumers would be able to receive energy improvements in effect for free, reducing energy consumption and breaking free from spiralling energy bills. Not only would the house save money and have a lower carbon footprint but, it was hoped, such schemes would reduce carbon production throughout the country, helping to achieve the Government’s carbon reduction targets.

A scheme that empowers households to get out of fuel poverty and have warmer homes is always welcome, but for far too many this scheme failed, and failed utterly. The Government’s ambitious aims looked good on paper, but they fell well short and, as the result of a weak and ill-conceived framework, families were left far worse off. Rather than “pay as you save”, constituents were left paying more and saving nothing or, in far too many cases, actually footing the bill for fraud. Investment in energy savings should be a national priority, and I think that everyone across the House would agree that we need to meet fuel poverty targets and reduce carbon dioxide emissions, but elements of the scheme were so badly designed and involved such ineffective regulation that for many it became a nightmare.

I should point out, before the Minister does in her summing up, that plenty of businesses and providers did not abuse the system, with the result that many consumers benefited from the scheme, as was originally envisaged. The green deal, however, was allowed to be abused by criminals who preyed on and exploited households, many of them vulnerable. Ultimately, regardless of one’s politics or trust in any Government, no one thinks they are about to be scammed when a Government logo is on the paperwork. We will come back to the Government, who were in effect the enablers of this great fraud, but the actual fraudsters themselves were Home Energy and Lifestyle Management Systems, or HELMS.

The behaviour of Home Energy and Lifestyle Management Ltd was inexcusable. The use of classic dodgy salesman tactics—overstaying in customers’ homes to intimidate them into a sale, blatant falsifying of figures, misleading documentation, fraudulent marking of signatures, insistence on inappropriate works and outright lying to elderly vulnerable individuals—has pushed victims into deeper fuel poverty and debt, with no access to a quick and effective remedy. In the majority of cases that I have seen, individuals were sold solar panels regardless of need or suitability. Once again misled on finance, those individuals unknowingly sold their ownership of the solar panel feed-in tariff to offset the up-front cost of works. Ultimately, that meant that households had solar panels on their roof, were possibly still liable for maintenance and servicing, and yet received no financial benefit.

More unbelievably, the managing director of the now liquidated company HELMS, Robert Skillen, not only is a director of PV Solar Investments Ltd—the separate company set up to receive HELMS’s customers’ feed-in tariffs that, shamefully, is still trading and is in receipt of mis-sold victims’ feed-in tariffs—and the man with the brassiest of brass necks, but is now looking to profit from “mis-sold energy claims” through a company called True Solar Savings, despite it not being authorised by the Claims Management Regulator. He has fleeced us once, but now wants to assist us in getting redress from his own company’s mis-selling. The man has zero shame, and his outrageous lack of recognition of his culpability is astounding.

Given Robert Skillen’s central role as managing director of HELMS, therefore, I strongly advise against any business interactions with that man or his companies. Robert Skillen and HELMS, however, were enabled by the UK Government, but my constituents and many others throughout the country are now paying the price for the Government’s casual short-sightedness.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

My constituency, like others, has been affected. One-hundred and sixty-nine of my constituents have been affected, and what was striking about the public meetings that we held was the proportion of elderly people in their 70s and 80s—one with dementia, another with almost total blindness—who were tricked into this. It was not, on any level, the selling of solar panels; it was fraud.

[Gavin Newlands]

I could not agree more with my hon. Friend. We are not in a competition, but although the issue affected 169 people in her constituency, in mine 293 households received HELMS panels, out of more than 3,000 in Scotland. Like her, I held my first public meeting on the issue earlier this month. As we know, attendance at such meetings can be a bit of a hit-and-miss affair, but although the subject was rather niche, targeting households with solar panels, about 120 people were in attendance. The meeting was full of individuals with similar stories of being taken advantage of by outrageous mis-selling, pressured into agreeing to inappropriately costed works or told blatant lies for a quick sale.

Two of my constituents, Mr and Mrs Murray, were particularly affected. A HELMS salesman knocked on their door in Linwood—a part of my constituency particularly affected by the mis-selling—and stated that it was to have funding available to invest in homes and energy. He had pressured the Murrays by insisting that the funding was time-limited and finite. They were told that they should have loft insulation, exterior wall insulation and solar panel works. He mentioned no tie between finance and their energy bills, and nothing about a debt tied to their property until 2039 at £1.47 a day.

[Gavin Newlands]

I could not agree more with my hon. Friend, the chair of the HELMS all-party group here at Westminster. I shall come to this, but the building warrants issue is complex. In fact, I apologise in advance for making a longer speech than I am accustomed to, because of so many such complexities, building warrants being just one of them.

Back to Mr and Mrs Murray. The HELMS salesman tied them into an additional finance agreement with a personal finance company for a debt repayment of more than £9,000 to meet the expense of the solar panel installation. My constituents acknowledge that they were aware of that finance, but were told by the salesman that they would receive feed-in tariff payments quarterly to offset that cost, as well as having the benefit of lowered energy consumption and billing. However, such was the unfathomable incompetency and mis-selling of HELMS that when the Murrays applied for their feed-in tariff payments, they were missing essential documentation for the process. They pleaded with HELMS, which remained unco-operative and, as we all know, then went into liquidation, leaving my constituents helpless.

It gets worse. In January 2016, the Department of Energy and Climate Change, as was, introduced a statutory instrument requiring all existing renewable energy installations with certification issued before 15 January 2016 to submit their feed-in tariff application by 31 March 2016 or be unable to claim any feed-in tariffs or export payments. The UK Government not only failed to protect my constituents from the unscrupulous criminal behaviour of HELMS, despite accrediting it as an approved provider, but went on to implement procedures that would prevent my constituents from ever receiving payment for the solar panels that they pay £88 a month for. Mr and Mrs Murray have gone from paying £90 a month for energy to paying £220 a month, all under a Government incentive.

Many people did not know either that a 25-year debt would be tied to their house, potentially making it difficult to sell. An even bigger impediment to selling houses is that many households—possibly the vast majority—have no building warrant for the insulation that was installed on the exterior of their property. They were not informed of the need to apply for a warrant, and now not only might struggle to get one but may have to cough up the statutory uplift of 300% extra for a late application.

To compound that, in some cases when homes generate on-site renewable electricity via generating equipment such as solar panels, their import supply meter is incompatible with and affected by that on-site generation, sometimes resulting in inaccurate meter readings and billing issues. The current metering system and equipment was designed and configured to record meter electricity flows from the distribution network to consumer premises, but on-site generation has in some cases resulted in metering difficulties at premises where it is used, which are increasing in number.

Two things can happen. First, the import supply meter can run backwards. Since the ’80s, to prevent tampering, meters have been fitted with backstops so they cannot run in the wrong direction. Where on-site generators are connected at sites with meters that do not have backstops, exporting electricity causes the meter to run backwards. As a result, the consumer’s import meter readings are reduced by the amount of electricity they export. When that is discovered, the supplier may recalculate the consumer’s bill for the period for which the meter operated incorrectly and charge the consumer for the shortfall. In most cases, on-site generation exports are unmetered and the supplier needs to use estimates to calculate the bill.

In other cases, the meter treats all electricity in the same way. Some digital meters are configured in a way that results in them adding exported electricity to the imported electricity meter reading, which can result in the consumer paying for both imported and exported electricity. Again, once that situation is identified, historical bills need to be estimated.

Two other constituents of mine, Mr and Mrs Scott, had a HELMS salesman at their door five times. On the fifth occasion, Mrs Scott agreed to the works. She did so only after researching the Government’s accreditation and backing of HELMS. The family have gone from paying around £70 a month in energy bills to paying between £170 and £265 a month. The reason for that increase and variation in expenditure is that, on top of the green deal finance charges, the meter and the panels are incompatible. As a result, the family’s supply meter runs backwards and my constituents pay estimated bills from their supplier. They have fought for years to have that corrected. Only now, with prompting and reference to Ofgem guidance, has their supplier agreed to replace their supply meter with a compatible one.

That shows how ill-equipped HELMS was. Its lack of knowledge—or more likely, if we are honest, its lack of care—about panel and meter compatibility was outrageous. That should never have been an issue, and my constituents should never have seen their energy bills triple.

Members are no doubt beginning to see just how complex this issue is. My constituents and many other people across the UK have been through years of agony in seeking redress. HELMS failed to correct complaints. Constituents who took their cases to the green deal ombudsman were told they could no longer use that as a route to redress because HELMS no longer participated in the ombudsman scheme. Cases sat with the Financial Ombudsman Service for well over a year with no action. HELMS was liquidated and redress, such as it was, was unobtainable.

This was a UK Government incentive, backed and promoted as such. HELMS was accredited, and indeed promoted, under the Government banner, allowing it to enter homes and sell under a false umbrella of trust. Many of the families I have dealt with were sold on the phrase, “Government backed”. In fact, that was what persuaded many of them to listen to the dodgy sales patter in the first place. I have subsequently found that during that time, when someone searched online for a list of Government-accredited providers, HELMS was often top of the list.

How can the Government sit idle while households are left saddled with the hardships caused by HELMS? The very reason why work was agreed to was the shiny stamp of approval from the UK Government. What good is Government accreditation if it is worthless when issues and violations occur?

Who takes responsibility? HELMS and Robert Skillen have thus far escaped ultimate accountability. Despite being fined £200,000 by the Information Commissioner’s Office, they paid a mere £10,000 before the liquidation of HELMS. That highlights why the ICO has called on the Government to allow it to issue penalties of up to £500,000 to the company directors responsible.

Thus far, the Government have washed their hands of any responsibility for this mess. Instead, they hope the Green Deal Finance Company, which purchased the green deal loan book from them, will deal with it. Although GDFC was aware of some irregularities, it was not informed of the scale of the mis-selling and fraud that HELMS undertook. Given the delays with seeking redress through the ombudsman, GDFC offered to take over the case load directly to try to speed up the process. Although that has helped, the process is still too slow. GDFC has admitted that it was ill-equipped and under-staffed to deal with the scale of the issue. It has apologised for the delay and vowed to speed up the process.

Colleagues may have a different take and may have casework to prove otherwise, but I have met GDFC three times—I was particularly pleased that it attended my public meeting in Linwood—and my impression is that it is diligently, if slowly, working through the various claims and, in the majority of cases, making offers to reduce loans or cancel them altogether. Of course mistakes will be made—my office has asked GDFC to reassess particular decisions, and it will continue to ask if necessary—but thus far, in my view, GDFC has worked in good faith.

[Dr Whitford]

Is not part of this issue that people of that age should never have been sold 25-year finance for solar panels that may last only 15 years or so? The offer to my constituents seems to have been only to reduce what they owe, not to clear it. They are still being told, “We’ll let you off £4,000, but you still owe us £6,000 for panels that aren’t working.”

--- Later in debate ---

[Jim Shannon]

The Minister is listening intently to what is being said and I look forward to her response. I know this matter is not ultimately her responsibility and she is filling in; nevertheless, I hope she is able to respond to my hon. Friend’s intervention.

When the company went into liquidation, many customers found themselves at a total loss, unable to take up their case with either the ombudsman or the company. The fact that the green deal was backed by Government undoubtedly gave the scheme credibility. The hon. Member for Paisley and Renfrewshire North said that one of his constituents phoned to check the scheme and found that it was Government-backed, so thought that it must be all right, but it was not. Coupled with the idea of saving money and being green, that resulted in many customers signing agreements that they did not necessarily understand, on the premise that their bills would not increase. It was disappointing for many that that did not turn out to be the case.

Members have given evidence that these operators of the scheme took advantage of their constituents. That said, Members must ensure that we do not undermine public trust in these types of scheme, given the potential benefits they can deliver. For example, in Northern Ireland, we have worked hard to tackle fuel poverty, and earlier this year, fuel poverty figures for the Province fell to 22%—a welcome drop from 42%. That indicates what we are doing back home, even with a stuttering Assembly.

[Dr Whitford]

I understand that the Government hope to do a future green deal project. Will that not be completely undermined if this issue is not resolved?

[Jim Shannon]

The hon. Lady is absolutely right. The Government have a great responsibility to address the issue for the sake of the credibility of any future schemes and so that participants in them will not worry about the future.

It is important to recognise that price fluctuations in home heating oil played a role in the fuel poverty figures I just gave. The reduction is welcome news, but we should not rest on our laurels: 22% of people considered fuel poor is still 22% too many.

A scheme that has proved to be extremely successful is the Northern Ireland sustainable energy programme. It has a particular focus on tackling fuel poverty, with 80% of funding ring-fenced for vulnerable and low-income families. The NISEP provides help to install energy-saving measures in homes, including energy-efficient boilers, heating controls, loft insulation and cavity wall insulation. With funding coming from a levy paid by all electricity customers, the scheme is delivered by energy companies and managed by the Utility Regulator. We have a system in place that has managed the programme well and delivered.

In 2017-18, five energy companies provided schemes, each of which had different eligibility criteria and incentives and/or grants to help people to make their homes more energy efficient and perhaps reduce their overall energy bills. As I mentioned, the focus is on those at risk of fuel poverty—for example, many of the schemes work directly with housing associations, which identify eligible tenants. The sheer variety of schemes means that people can make informed decisions about which scheme would best suit them and address their specific needs.

The NISEP provides some £7.9 million towards energy efficiency interventions, which include insulation and heating upgrades. It has proved so successful that it has been extended again until March 2019. The programme is working. The hon. Member for Paisley and Renfrewshire North referred to a different scheme. I only wish that scheme were the same as then we would not have needed this debate. We have accountability whereas, as he said and as we want to illustrate, there is no accountability in that scheme.

--- Later in debate ---

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) on securing the debate and making a powerful speech to introduce the complex but dramatic and distressing situation of green deal mis-selling and the impact of HELMS in particular.

I was elected last year by a community that I have grown up and lived in my whole life. Balornock is probably similar in many ways to Linwood in the hon. Gentleman’s constituency: it was an overspill estate created after the second world war, built at a time of great optimism in the Glasgow city region, where people were moving out of overcrowded slum tenements in the inner city and into what they saw as new build housing, with indoor toilets and front and back gardens. The community was largely born of the baby boomer generation, who moved in and have lived there their whole lives. Many benefited, as they saw it, from buying their council houses in the 1980s and 1990s, and, as they reached retirement, they wanted to make improvements to their houses.

The community was built out of great optimism and aspiration for the future. Five years ago, the green deal was launched to great fanfare by the Tory Government, with the promise of a win-win situation for homeowners: lower energy bills and the chance to do their bit for the environment. It seemed like a great idea. Those who sought to exploit that scheme cynically homed in and targeted communities, particular those with a large population of baby boomers in self-contained housing units—not flatted accommodation—with back and front gardens. If the scheme sounded too good to be true, that was because for some in those communities it turned out to be exactly that.

Dozens of my constituents in Glasgow signed up to install green deal-financed improvements to their homes, such as solar panels and insulated cladding, but that has proven to be one of the worst decisions they have ever made. Instead of realising the Government’s vision of a flagship programme to reduce fuel poverty and improve energy efficiency, the complete failure to regulate the scheme properly has allowed it to be ruthlessly exploited by gangsters and other rogue traders, who have systematically preyed on trusting people who thought that, as the scheme was approved and accredited by the Government, they could trust its credentials and sign up.

In 2015 Christine McBain, one of my constituents, handed over her life’s savings to a Cambuslang-based green deal provider called Home Energy and Lifestyle Management Systems—otherwise known as HELMS—to put external wall insulation on her Swedish timber-framed house in Balornock. Those houses are a common feature of Balornock, because after the second world war the overspill in Glasgow was so problematic that timber kit houses were imported from Scandinavia, such was the pressure on housing. More than half a century later, those houses are not the most energy-efficient, so this offer seemed like a plausible way for those homeowners to make them better. As I have said, it turned out to be the worst decision they ever made.

Another constituent, 86-year-old Mary, handed over her lifetime’s savings and has been left with £17,000 of debt after being duped by HELMS with no sign of any redress. It is the most appalling experience as an MP to see people who are meant to be enjoying their retirement, and feeling safe in their life’s work and savings, but who have been stripped of any sense of security and are in absolute distress about what they are having to deal with. If this is not dealt with urgently, sadly they will have to deal with it for the remainder of their lives. That is a shameful indictment on the Government’s failure to regulate their policy.

Christine and Mary are among many local residents in my constituency who have been left totally in limbo by HELMS. The company carried out similar works on more than 160 properties in my constituency without obtaining the necessary building warrants, cynically preying on local residents with promises of free solar panels and cavity wall insulation that would save them thousands of pounds. Normally such a matter would be easily remedied with a retrospective application for a building warrant from Glasgow City Council. However, because building standards were not adhered to by HELMS, no backdated planning permission can be granted without costly surveys. In addition, the statutory fee for a building warrant will be tripled where works have already been completed. Residents simply do not have the financial resources to fund that, and in the absence of building warrants the houses are now uninsurable and unsellable. Residents—many in the latter years of their lives—feel effectively imprisoned in their own homes. That is shameful.

I am currently seeking agreement from Glasgow City Council to waive the multiplier fee for the retrospective warrant and to cover the cost of the surveys needed for the building works. Will the Minister write to Glasgow City Council’s chief executive to make a similar call?

[Dr Whitford]

Does the hon. Gentleman not accept that the underlying fault lies with the UK Government scheme? To me, the UK Government lobbying Glasgow City Council to pick up those costs, rather than offering to fund them, seems the wrong way round.