I beg to move,
That this House has considered cavity wall insulation in Wales.
It is a great pleasure to serve under your chairmanship, Mr Nuttall—I think for the first time—and to lead a debate on this issue. Unfortunately, after many years of campaigning, lobbying and debates, it is still unresolved.
Many of my constituents had cavity wall insulation installed, having been persuaded—in fact, I would use the phrase “deceived by omission”—that it was suitable for their homes and for local weather conditions. How wrong they were. Many have found that out to their cost, as they have suffered damp and damage, stress, threats to health and ever-present black walls.
The whole of Wales and indeed much of the UK’s western seaboard is categorised as having very severe exposure to wind-driven rain. Does my hon. Friend agree that the Building Research Establishment maps that point that out should have been widely publicised by the Government so that people could assess whether cavity walling was appropriate in their area?
That is certainly the case. It is an elementary step. One just needs to look at the map of the UK. The west of Wales, the south-west of England, the north-west of England and Scotland are all coloured a deep blue, and areas such as East Anglia are coloured white. A five-year-old could look at that map and see where the rain was going to be and where there might be problems. Unfortunately, many people were not aware of those maps or of this issue.
The consumer redress process so far has been unsatisfactory. Vulnerable people have been left in damp and damaged homes. The industry guarantee scheme has failed many victims and has shortcomings, including sometimes—I am sorry to say this—a hostile attitude to victims. There is an opportunity for the Government to put things right, and my demand—I put it as strongly as that—today is for the Minister to take decisive action to protect consumers from further bad practice, identify all victims and fully compensate all those who have been affected by what is clearly a Government-backed scheme.
I wholeheartedly agree with the hon. Gentleman’s comments. I, too, have constituents who have been terribly affected. In one case, an elderly couple had cavity wall insulation installed 10 years ago by Domestic and General, which subsequently went into liquidation, and they have had the shambolic experience of dealing with the Cavity Insulation Guarantee Agency—particularly its head of customer service—and all sorts of other agencies. It has just become one shambles after another, and they have not had redress.
I am afraid that the picture the hon. Gentleman paints is all too common, especially in Wales but also in parts of the north-west of England. For example, people from Blackpool have travelled all the way to Bangor and Caernarfon to see me to explain the difficulties that they have had in areas where cavity wall insulation has been installed without explanation and there is wind-driven rain, which is the danger.
I welcome the long-awaited report of the Bonfield review entitled “Each Home Counts”, which was released on 16 December last year; some hon. Members may have seen it. A review was first considered by the then Under-Secretary of State for Energy and Climate Change, the right hon. Member for Hastings and Rye (Amber Rudd), on 3 February 2015, during the second debate we had on the issue. I spoke in that debate and expressed my concern about the attitude towards victims of cavity wall insulation of some in the insulation industry and the official bodies that allowed this to happen.
The hon. Gentleman speaks about this issue with great authority and passion for his constituents and people across the UK. My constituent Sarah Morgan recently discovered that she had two different CIGA guarantees for her property—one with a clause detailing the homeowner’s responsibility for property maintenance and one without. Does the hon. Gentleman agree that that subtle change is being used by CIGA as nothing more than a get-out clause?
Perhaps the hon. Gentleman is blessed with clairvoyance, because I was going to raise that matter. It is extraordinary that the maintenance clause is in the small print, as I understand it, and then suddenly reappears in the rather fancy guarantee as a separate and prominent item of its own. I should imagine that had people—especially older and perhaps disabled people—been aware that they had to maintain the house to a high standard, a lot of them would not have gone in for cavity wall insulation in the first place. That has certainly been my experience with the many cases that I have come across.
This matter has been raised on numerous occasions by cross-party alliances, supported by the tireless work of the victims’ support group, the Cavity Insulation Victims Alliance. I am glad to have this opportunity to commend CIVALLI’s work, which it does with virtually no resources. It communicates the distress of consumers who reach out to it, dismayed at the effects of cavity wall insulation, the process through which it was sold and installed, and the attitudes of bodies that were set up to protect them. Its efforts have resulted in this matter being brought to the forefront of the political agenda, a “better late than never” review and some positive steps.
As CIVALLI and I rather expected having met Paul Bonfield, the review focuses on recommendations for future cavity wall insulation but does not place responsibility or blame for redress or provide compensation for those who have been disadvantaged. The review is forward looking, and quite reasonably so, but our concern is with the large number of historical cases.
The review underlines some positive progress. The British Board of Agrément and CIGA have launched a scheme whereby property assessments are independently reviewed for compliance with industry specifications to ensure that cavity wall insulation installations are carried out only on suitable properties. It strikes me, though, that the review’s publication and the progress made so far is much too little, much too late. I might say that the Titanic, alas, is already going down.
My concern is about the millions of homes already treated with cavity wall insulation, a proportion of which are problematic. I do not know what that proportion is, and it seems that no one else does either, for that matter. We do not know how many there are or where they are, but it is clear that cavity wall insulation has been installed in properties unsuitable due to their location, the size of the cavity, the state of external walls, rendering or pointing.
My constituency, Arfon, is in the category 4 area; in fact, much of west Wales is category 4, as my hon. Friend the Member for Dwyfor Meirionnydd (Liz Saville Roberts) noted. When I raised this issue with the then Under-Secretary in the debate in February 2015 and asked her whether cavity wall insulation should have been installed in these areas, her response was:
“My recollection is that mostly it should not have been.”—[Official Report, 3 February 2015; Vol. 592, c. 20WH.]
That is as clear as can be: it should not have been put in, but it was. Installers, CIGA, manufacturers of cavity wall insulation, Governments and everyone seemed to claim that insulations were preceded by a full assessment of the suitability of the property. I am yet to see an assessment report, and seriously wonder whether such reports exist in any real sense.
In my experience, installers failed to take customer complaints seriously and to provide adequate redress. There seems to be a culture of avoiding customer queries, not responding at all, failing to provide full answers to straightforward questions and denying liability. I have heard people say so many times that they were told that it was just condensation—“Open a window and let all that expensive heat out; we’ll sell you some more”, presumably.
Extraction of failed cavity wall insulation is only one element, and most customers will not be offered even that. In my opinion, customers should also be able to recover costs for interior and exterior damage due to the poor installation and extraction, plus compensation for the distress caused. When I have talked to CIGA, it has said—quite reasonably, I think—that it is a guarantee scheme, not a compensation scheme. However, people have suffered, and they deserve compensation.
Many people complain that they signed up for cavity wall insulation only because they were explicitly told that it was a Government-backed scheme, and they feel that the Government should take responsibility for putting things right. In fact, I have seen a sales video that, after about eight minutes of hard sell, has a prominent TV personality saying clearly that it is a Government scheme. Now, he is a salesman and a television personality, but people took him at his word.
We know that CIGA proffered a 25-year guarantee but, again, that guarantee was worth little to most people after it became clear that there was not a suitable system of quality assurance for installers. Indeed, that was a matter I took up with the previous Minister.
Sitting suspended for a Division in the House.
I was talking about the guarantee and the fact that a clause in the small print has now been amplified to the main document. My friends in CIVALLI have told me that, on one property, there are two guarantees, two versions of the same guarantee—one with and one without that clause. It seems to me that CIGA sometimes uses the maintenance condition as a get-out clause. If people had been properly aware of the stringent maintenance rule, many of them would not have risked having CWI. The guarantee is pointless if the maintenance is unaffordable. Many of the people who put this material in are older, disabled or on low incomes; in fact, in Wales 25% of people are living in fuel poverty. Those people will not be up a ladder making sure that the rendering under the roof is proofed against wind-driven rain. The fact is that people in deprived areas were targeted, because they were keen to take part in the scheme and save money on their heat.
Many of the companies that carried out the installations are now defunct. Through recent correspondence with the British Board of Agrément, I have been notified that provisions have been put in place to help consumers where cavity wall insulation has been abandoned, for either company liquidation or inadequacy reasons. I think that is to be respected, but I am worried about this matter more generally.
I am worried that CIGA is under-resourced, hence the resistance to addressing remedial damage and to funding extraction properly. It is adamant that installers should assume liability, but in my constituents’ experience, that often proves impossible, especially given that so many of the companies have gone into liquidation—they were something of a fly-by-night set of organisations. That is resulting in a pattern of CIGA offering to extract from one wall only, which is against expert guidelines and will lead to other problems.
My constituent Alwyn Williams has been battling for three years with this problem. The original installers went bust. CIGA refused to help and refused all liability for two years, on the basis of the poor maintenance clause. It has now offered to extract from one wall. I have spoken to several experts in the field of extraction, including Andrew Quayle of Titan Insulation and Damian Mercer of Cavity Extraction Ltd, who tell me that extracting from one wall creates a cold spot and is likely to severely worsen the problem in the long term.
CIGA does offer an alternative dispute resolution, which I am glad of, and CIVALLI offers support and advice. There is, however, a yawning power gap between the two sides here. Of course, victims require an independent private survey, which can cost around £300; otherwise, there is not a lot of chance of them winning their case. Due to the sheer number of failed CWI installations, the extraction industry is now booming, and I fear we are putting ourselves in line for a further scandal, as extractions are carried out but not properly inspected.
My speech today has been on many of the industry’s failings, but as I said earlier, this is a Government-inspired scheme. Successive Governments have advocated unpoliced and unregulated cavity wall insulation schemes in the race to secure carbon reduction targets—energy companies are being fined by Ofgem for not reaching those targets. That is all at the expense of the quality of life of the victims; their lives have been ruined.
At the very least, the UK Government should have the answer to the following questions. How many people have suffered at the hands of this particular scheme? I have heard estimates of 1% or 2%, but given that there are millions of installations, that is a large number of people. Who are the people who have been affected? Where do they live? I think they live on the west side of Britain. How will their problems be rectified? The big question is, who is going to pay for all this? To be fair to CIGA, it is under-resourced. It depends on its guarantee income, which surely will not be sufficient.
I will end by saying that, in the debate in 2015, the then Minister, who is now the Home Secretary, said that an election was due and she would leave the file open on her desk for her successor. We now have an election due again, and I hope the Minister is not going to sign off by saying that the file will be left open. We really do need some action as soon as possible on what I can only describe as an emerging scandal.
It is a great pleasure to serve under your chairmanship, Mr Nuttall. I start by congratulating the hon. Member for Arfon (Hywel Williams) on not only securing this debate but his persistence over many years on this subject on behalf of both his constituents and a wider population of people who feel their voices are not being represented clearly enough. In that context, I would like to place on record my appreciation for the work of the Cavity Insulation Victims Alliance, members of which I had the pleasure of meeting briefly before the debate started again. We must work towards a situation in which no one feels they are a victim, but we are clearly not there yet.
I would like to say something briefly about the context of the debate and the consumer protection that we think is in place and that should be working. I will also try to answer some of the hon. Gentleman’s questions about the scale of the problem as we understand it and perhaps give him some reassurance about the progress we think is being made and the Government’s commitment to continue to press for an even better response on something that is clearly causing a great deal of hardship, difficulty and distress.
The hon. Gentleman knows the context very well and alluded to it. This Government, like previous Governments, have been keen to make it easier for people to take insulation and other energy efficiency measures that will help to make their homes more comfortable, warmer and more environmentally friendly. He knows as well as I do that if cavity wall insulation is fitted appropriately—that is a big if—it can be very effective in reducing consumption and cutting people’s bills. We have therefore committed to the insulation of a further million homes in this Parliament through a policy tool known as the energy company obligation, which is increasingly focused on trying to provide support for the poorest and most vulnerable households. That is the policy context, which he understands well.
Given that ambition, it is incredibly important that a good level of trust underpins the supply of these services. That trust is what we are really talking about today, and in too many places it does not exist. Consumers need to feel confident that they can trust the quality of the advice that they receive and of the installation that takes place in their homes. We need consumers to have the confidence to make decisions about their properties to improve the energy efficiency of their homes. This will not work unless there is that element of trust in the system.
On consumer protection—I think the hon. Gentleman knows this, but it is worth briefly placing on the record—a lot of regulation is in place to give the kind of consumer protection that we all want to see for our constituents. The installation of all cavity wall insulation must meet the requirements of the Building Regulations 2000. Materials used in cavity wall insulation are subject to specific standards and must be certified by an independent technical approval body. All cavity wall insulations installed under the energy company obligation are subject to a survey prior to installation. I understand his point about independent services, but the requirement for a survey is in place, in part, to verify that the measure is suitable for the property; I think that that is one of his major points, particularly about the part of the country that he represents. All installers working under ECO must also comply with a PAS—publicly available specification—that sets out requirements for the installation of energy efficiency measures in buildings, including cavity wall insulation. Ofgem requires technical monitoring inspections of 5% of measures installed under ECO. It also requires, as the hon. Gentleman noted, that cavity wall insulation measures installed under ECO be accompanied by a 25-year guarantee. As ECO administrator, Ofgem sets out clear requirements for those guarantees as part of its scheme guidance: they must include assurances not only about the quality of installations and the products used, but that funds will be available to honour the guarantee, which must cover the costs of remedial and replacement works.
Those are the protections in place. We recognise, because the data show it, that sometimes things may not work out as expected for consumers. When that happens, it clearly causes a great deal of distress. If there is a problem, our advice is that consumers should initially contact the installer who carried out the work and see whether the problem can be rectified. If that is unsuccessful, they should contact the guarantee provider of the energy company that originally carried out the work. If a consumer’s claim is covered under the terms of a guarantee, either the guarantee provider or the installer will arrange for the necessary works to be completed at no cost to the householder. In many cases that should provide a solution to the problem. However, if for any reason there is no effective guarantee in place, consumers may wish to obtain further guidance from their local trading standards office or seek professional legal advice.
The hon. Gentleman asked about the scale of the problem—the number of insulations completed and the number of consumers who have reported concerns. According to CIGA—the Cavity Insulation Guarantee Agency, which is the largest provider of guarantees for cavity wall insulation, as he knows—since 1995, 330,000 cavity wall insulation installations have been completed in Wales and 3,663 consumers, or 1.1%, have reported concerns. Some may argue that that is a statistically relatively small number, but as far as I am concerned it is 3,663 consumers too many. We need to work towards a situation in which there are no victims and no problems with the quality and probity of insulation work, as he set out powerfully in his speech.
The important thing is that when problems are reported they are addressed. Of the 3,663 recorded cases, CIGA claims to have resolved 2,939 while installers have resolved 724. In answer to the hon. Gentleman’s question, that is what the statistics show. My concern—I will be candid with him because he alluded to this—is that the statistics may understate the problem because they cover people who have reported a problem. He told me anecdotally that in his constituency there may be a much higher number of people who have not reported a problem and who are passive in their misery about what has happened to their homes. The Government must be sensitive to that.
We are not remotely complacent, which is why, as the hon. Gentleman said, we commissioned a review of quality, standards and consumer protection across the whole domestic energy efficiency and renewable energy sector, including cavity wall insulation. I am glad he welcomed that. I know he thinks it may not be sufficient, but I thank him for welcoming it.
The “Each Home Counts” review published on 16 December 2016 recognises that there should be consistent, high quality work in this sector and has made a number of recommendations, which will be taken forward by the industry with the Government’s support. This work is enormously important to our constituents because it is about their homes and very little is more important to them. There should be no room for cowboys in this market and we must hound them out. The review engaged with a diverse range of stakeholders and demonstrates the potential for a new approach to increase consumer trust.
Ensuring a clear and robust standards framework, not just when work is undertaken as a result of Government policy but wherever it happens, is fundamental and that is one of the key actions that the industry is now taking forward, which we will monitor carefully. The review includes recommendations to improve the provision of advice to consumers, as well as for improving skills and training in the workforce. We expect to see implementation plans—words are not sufficient—and delivery proposals from the industry in the coming month.
The hon. Gentleman expressed concerns about CIGA that have been expressed before and those concerns and criticisms have clearly been valid. CIGA is the largest guarantee provider and an important institution in this context. I have been assured—I will follow this up after the debate to seek extra assurance—that it has taken steps to improve the service it provides to consumers. It is under new leadership, as the hon. Gentleman probably knows, and those steps include hiring additional technical inspectors, appointing a consumer champion and introducing access to an independent alternative dispute resolution service operated by a provider approved by the Chartered Training Standards Institute. I will not repeat what previous Ministers said about leaving an open file, but I will write to the chief executive of CIGA setting out clearly some of the reservations that the hon. Gentleman eloquently expressed in this debate, and I will seek an explicit response.
I assure the hon. Gentleman, other hon. Members, CIVALLI and all those out there who are concerned about the issue that we genuinely recognise their concerns. It is in everyone’s interest that the market operates efficiently and that there is trust between customers and service providers. We are focused on ensuring that consumers can choose the right energy efficiency measures for their homes to deliver carbon and bill savings. We share hon. Members’ concerns that the work should be done consistently well and, if not, that appropriate redress should be available.
I am assured that CIGA has listened to the concerns expressed in previous debates in this House—it would have been deaf if it had not—and that steps have been taken to make the organisation much more customer service-friendly, but it needs feedback from Members of Parliament and other representatives on how much progress is really being made. I hope that the details I have set out about the significant steps that have been taken to improve customer service are reassuring.
I assure the House that the Government will continue to work with the industry to improve further the standards and quality in the energy efficiency and renewable energy sectors so that, as we move forward and try to encourage more of our constituents to upgrade their homes to make them warmer, more comfortable and more environmentally friendly, they can do so with trust.
Question put and agreed to.
That this House has considered cavity wall insulation in Wales.