Overview: Widespread problems in home insulation schemes
A new report from the National Audit Office (NAO) has cast a harsh light on the way Britain’s home insulation programs were run under the previous government. The investigation found that almost all external wall insulation installed under the Energy Company Obligation (ECO) and the Great British Insulation Scheme (GBIS) was fitted so poorly that repairs or replacements are likely necessary. In total, roughly 23,000 homes received external insulation, with an estimated 98% requiring remediation.
In addition, 9,000 to 13,000 homes equipped with internal insulation also face major issues, affecting about 29% of those installations. More than 3,000 installations across both categories are considered likely to pose health and safety risks that demand immediate attention. The findings suggest a systemic failure in delivery and oversight that has left many households exposed to damp, mould, blocked ventilation, and even exposed wiring.
The human impact: Damp, cold, and damaged prospects for homeowners
As the NAO report notes, poorly executed insulation can undermine the very purpose of the schemes: to reduce energy bills and improve living conditions. For some homeowners, the defects have made homes harder to remortgage or sell, and in the worst cases, the insulation has contributed to colder, damper conditions that worsen health risks for vulnerable residents.
Industry observers and housing advocates have reacted with concern. Simon Francis of the End Fuel Poverty Coalition described the situation as a breach of trust in energy efficiency programs and a missed opportunity to address fuel poverty. Jess Ralston, an energy analyst at the Energy and Climate Intelligence Unit, emphasized that insulation and proper ventilation, when done right, are among the safest and most effective ways to cut costs and improve warmth.
What went wrong: Systemic failures and weak oversight
The NAO concluded that the ECO and GBIS programs suffered from an overly complex structure, with blurred responsibilities among scheme providers, certification bodies, the Ofgem regulator, and the Department for Energy Security and Net Zero (DESNZ). This fragmentation allowed installers to “game” the audit process, including multiple certifications or transfers between bodies, reducing the accountability and traceability of past work.
Fraud also emerged as a major concern. Ofgem estimated that retrofit businesses had falsified ECO claims for a broad range of homes—between 5,600 and 16,500—potentially defrauding energy suppliers of tens of millions of pounds. Sir Geoffrey Clifton-Brown, chair of the Commons’ Public Accounts Committee, described the failures as stark and warned that insufficient quality data leaves overall fraud levels unclear while stressing the need for robust consumer protection and clear accountability.
What happens next: Fixing a broken system
The government has acknowledged the problems and announced reforms intended to protect households and ensure faulty installations are corrected at no cost to consumers. Energy consumers minister, Martin McCluskey, said the administration is taking decisive action to fix the broken system and establish clearer lines of accountability. Installers are now liable for the cost of rectifying any faulty insulation installations under the scheme, and households affected have been advised to contact Ofgem for remediation support.
Experts urge ongoing vigilance, strong data collection, and tighter oversight to prevent a recurrence. The NAO’s critique centers on the need for a simpler, more transparent governance structure, consistent auditing, and a reliable certification regime to restore public confidence in energy-efficiency schemes and to ensure homes are warm, healthy, and affordable to heat.
Takeaway for homeowners and policymakers
For homeowners, the report signals that ties between government schemes and real-world results may diverge, and that remediation work could be required even after installation. For policymakers, the key takeaway is a cautionary lesson in program design: clear roles, robust auditing, and strong consumer protections are essential to turning ambitious green aims into secure, tangible benefits for households nationwide.
