Chancellor Rishi Sunak should offer tax incentives to home owners, spurring them to increase insulation in their homes before the properties are put up for sale, a new alliance of construction firms, charities and insulation suppliers urges.
A new ‘Energy Saving Stamp Duty Incentive’ is the demand from the Energy Efficiency Infrastructure Group (EEIG), an ad hoc grouping of more than forty socially and commercially interested parties. They include energy supplier Eon, the National Home Improvement Council, the UK Green Building Council and architects’ professional body RIBA.
The energy-wasteful status of Britain’s housing stock is an abiding, little publicised stain on a nation which leads Europe in its share of owner-occupation. A decade ago, the then energy minister of Wales’ devolved government shared with an audience at the Future Build trade show her belief that in Europe, only Estonia had leakier homes than the UK.
The seven-point Energy Performance Certificate introduced in August 2007 by Gordon Brown’s administration and required now when selling or letting dwellings, has arguably had a less-than transformative impact in raising standards of thermal efficiency.
The EEIG’s new solution focuses on Stamp Duty. Adding an insulation requirement to lighten that tax burden paid by purchasers when homes are sold would boost green upgrades, the EEIG asserts.
Around 19 million households in the UK are in owner-occupation. In England and Wales the majority are owned under freehold. Four million households “own” their accommodation only under leasehold, and would need permission from their freeholders for the improvements.
Carbon emissions from Britain’s total of 29 million households have risen since 2016, says the EEIG, and now account for 20% of the nation’s atmospheric pollution. Pre-Covid, around one million homes were changing hands each year.
“An Energy Saving Stamp Duty Incentive could prove more effective, and simpler, than a large-scale, short-term, costly grant programme – whilst also being revenue neutral”, EEIG chair Sarah Kostense-Winterton tells the Chancellor in this week’s letter.
“It can be adopted quickly, to be fair to homeowners, and sufficiently rapidly to give the UK Government the chance to reach its target of a 78% reduction of UK greenhouse emissions by 2035.
An insulation incentive linked to Stamp Duty would not be “a silver bullet”, the EEIG admits. “We are not suggesting that any rebate should cover the full cost of works that might be needed, Kostense-Winterton writes”.
“We are, however, proposing a rebate significant enough to get homebuyers’ attention and create the conditions for homeowners and purchasers to invest in, and improve, their own homes.”
The EEIG says its proposal would be revenue-neutral, imposing no burden on tax-payers.
Sunak is now assumed to be a Conservative leadership hopeful. His reported quailing last year at what his Treasury officials saw as the high costs of the Green Homes Grant scheme, was reputedly among reasons for its axing, less than six months after launch.
Against a target of 600,000 homes projected to benefit over two years, in fact poor design set-up of the D-BEIS-led initiative and its inept administration was revealed by Parliament’s environmental audit committee to have benefitted only 5,800 households.
The Cameron government did almost as badly in mass home insulation with its expensive, debt-led Green Deal.