Associate Feature: Vulnerable households will be left in the cold without urgent changes to energy efficiency funding

In our latest research report, Harnessing Scotland’s Social Housing Expertise, the Chartered Institute of Building (CIOB) has made several policy recommendations for urgently needed changes to Scottish Government energy efficiency funding programmes for housing associations. 

Retrofitting Scotland’s social housing sector will help to address three key policy priority areas in tandem: decarbonising Scotland’s housing stock, preserving the number of affordable housing units available, and helping to lower fuel poverty rates for vulnerable households. 

Our report, developed in collaboration with Scottish housing association representatives, outlines the alarming barriers blocking them from accessing vital Government-backed funding schemes to improve the energy efficiency of their 280,000-strong housing stock. Given the scale of these challenges, many say they feel Government is setting them up to fail. They cite financial constraints, the cost-match funding required on their part, last-minute approvals, and the extensive administration work involved to prepare an application as key barriers. With no guarantee of getting the funding, many also say they find themselves unable to roll the dice to make a bid. 

As a first course of action, restrictions within funding schemes like the Social Housing Net Zero Heat Fund that prevent housing associations from using other public funds to meet cost-matching requirements should be removed. Allowing for the blending of funding programmes, thereby lowering the upfront capital contributions required of them, would overcome a significant barrier for both large and small housing associations.

Over the longer term, Scottish Government should combine energy efficiency funding for housing associations into a central pot. This centralised funding should be administered over a five-year term, allocated based on need, without parameters on the specific use of funds, and with metrics that focus on obtaining the best outcomes for tenants and energy performance. Housing associations have demonstrated that they have the expertise, the knowledge about their stock and their tenants, and the overarching mission to provide good quality homes that are required to deliver upon Scotland’s retrofit objectives. They just need the long-term financial support of Scottish Government to get there.

Beyond overhauling the current social housing funding landscape, we are also calling on Scottish Government to convene a ministerial oversight group on retrofit to bring ministers with responsibility for housing, net zero buildings, skills & education, community wealth & public finance, and planning together to develop a National Retrofit Delivery Plan. 

The sector is facing broader challenges in achieving widescale retrofit goals. Awareness of government incentive schemes is worryingly low: recent consumer data from the CIOB found that over a third of the 2,000 respondents in Scotland had not heard of any of the past or current government incentive schemes available for energy efficiency upgrades. Further, the construction industry continues to face a worsening skills shortage that makes completing retrofit projects, especially in rural and highland areas, increasingly difficult. Therefore, any future National Retrofit Delivery Plan must consider the resources – both financial and human – that will be needed to bring all of Scotland’s housing stock up to the standards required to achieve housing, decarbonisation and fuel poverty targets. 

Taking these actions will ensure all relevant government departments are working together and thinking holistically about the resources needed to meet the retrofit challenge and allocate funding strategically across housing tenure and geographical location. Without this long-term, joined-up thinking, we will simply not meet Scottish Government’s net zero targets.

The cost of inaction is very real. With the existing barriers to the widescale retrofit of Scotland’s social housing stock, as one of the roundtable participants cautioned, “someone is going to have to make hard choices,” we urge Scottish Government to take immediate action to ensure that these hard choices don’t fall to Scotland’s most vulnerable households. 

This article is sponsored by Chartered Institute of Building (CIOB) 

https://www.ciob.org/