Green Deal 'shambles': MSE calls for refunds for those hit by fund closure

Update: 28 July 2014: The Department of Energy and Climate Change (DECC) has now told us it doesn't intend to refund people who've paid for Green Deal assessments but were unable to register for the Green Deal Home Improvement Fund before it closed last Thursday.

MoneySavingExpert.com is still calling for the Government to refund those left out of pocket and we will keep you updated with any further developments.

MoneySavingExpert.com is calling on the Government to refund anyone left out of pocket by last night's sudden closure of the Green Deal Home Improvement Fund, with many who've already paid for assessments no longer eligible for the grants.

Martin Lewis, founder of MoneySavingExpert.com, says the abrupt winding-up of the scheme, which offers households money to make their homes more energy-efficient, has been a "shambles", and warns it is "dangerously close to a form of Government mis-selling".

Many who already paid for Green Deal assessments but have not yet been able to apply for funding will now not be able to access this.

The Department of Energy and Climate Change (DECC) today refused to say if it would refund those who have already had assessments carried out. Those who have booked an assessment which hasn't yet been carried out have been told they should speak to their assessor directly.

However while the Home Improvement Fund has closed, the Green Deal scheme itself still exists. This lets homeowners borrow money for energy-efficiency measures such as upgrading boilers, installing loft or cavity wall insulation and much more. For full details see The Green Deal Mythbuster guide.

Many left out of pocket

The Home Improvement Fund, part of the Green Deal which is open to those living in England and Wales, closed suddenly last night after the £120m allocated for it ran out. Any applications received up to the time of the announcement, which was made at 6.30pm, will still be honoured at the original cashback rates. But many people who had booked and paid for a Green Deal assessment – typically costing £100 – had not yet been able to officially register with the scheme and will now no longer be able to benefit from the fund.

DECC was unable to tell us how many people were affected, whether it would be issuing refunds to those who've already had an assessment carried out or when it was likely to be able to tell us more.

This has angered some who booked and paid for an assessment with the intention of gaining access to the fund. But the assessment can still be used to access Green Deal finance and many assessors will take the fees off the cost of work if you choose to do it through them.

'This is a shambles'

Martin says: "After over a year of the well-meaning but the dismally operated Green Deal, finally the Government came up with the goods in the form of Home Improvement Fund.

"It wasn't surprising this took off as they were essentially bunging large wads of cash to people for doing up their homes. Yet to close it so suddenly risks overturning the success achieved.

"This is just a shambles. People have shelled out cash and to have the rug pulled from under their feet like this is unfair, unacceptable and unjust.

"As far as natural justice is concerned, the Government needs to refund anyone that's already paid-up for an assessment – or this is dangerously close to a form of Government mis-selling."

'Just paid £99 for a survey that's useless'

Many homeowners are now in the situation where they've paid for a green deal assessment but won't be able to get access to the home improvement fund.

• Rezina Chowdhury said on Twitter: "That will be £99 please for a GDA that proved useless because no suppliers would provide Green Deal Finance."

• Christopher Smith echoed this: "What a farce. Just moved, paid £99 for a survey that's suddenly useless!! How is that right and fair??!!".

• Matt Richardson was also left out of pocket by the cost of the assessment and by missing out on money from the fund. He said: "I am out of pocket to the sum of £144 and now not getting the £6,000 grant towards solid wall insulation for my home, thanks to the shambolic way grants were allocated."

How the Home Improvement Fund worked

The Home Improvement Fund was set up to give households money to make their homes more energy-efficient. An estimated 21,000 households successfully applied for the £120m pot of cash.

Launched in England and Wales on 9 June 2014, it offered up to £7,600 per household to help offset costs for measures such as solid wall insulation and double-glazing.

To access the fund, households were required to book a Green Deal assessment, with a Green Deal assessor, at a typical cost of £100.

Assessors then inspected homes to see what improvements they would benefit from. They then sent a report to DECC as well as to the homeowner, and households could register with the fund for a series of grants to help pay for improvements. The cash would then be paid to the homeowner through a voucher for the work.

Earlier this week, DECC announced that the cashback amount on offer would be lowered because £50m of the £120m pot had been used up already.

But after a surge of applications, a rushed announcement was made last night declaring the fund closed.

What was eligible for Home Improvement funding?

To qualify for the Home Improvement Fund, the measures needed to have been recommended by a Green Deal assessment or Energy Performance Certificate within the past two years. These measures included solid wall insulation, double glazing and floor insulation.

Any applications received up to the time of the announcement, which was made at 6.30pm, will still be honoured at the original cashback rates.

What happens if you've paid for an assessment?

If you've paid for a Green Deal assessment you won't be able to get cashback through the Home Improvement Fund as it's now closed. But you can still apply for a loan within the Green Deal.

The Green Deal was set up to help homeowners pay for the cost of double glazing, solid wall insulation, boiler upgrades and much more from the projected savings you'll make on energy bills.

To sign up you'll need an assessment so the assessor can look at your house and work out where it's leaking cash. It will then produce a report which will flag up potential energy-saving improvements and how much you could save.

The funding is given out as a loan, which is then attached to your home's electricity bill, and it's open to anyone, not just those on a low income. For full info see: The Green Deal Mythbuster.

What's not clear is what will happen to those who have paid the £100 fee for a Green Deal assessment but didn't have time to register with the Home Improvement Fund.

DECC has told us that if someone has booked an assessment which has not been carried out, they'll need to contact the assessor to cancel this.

If they've booked and paid for the assessment upfront, again they'll need to speak directly to the assessor about a refund.

However, if an assessment has been paid for and carried out, but the household is not yet registered with the scheme to access the funding, it's not clear if the money will be refunded.

A DECC spokeswoman says the Government is aware of this issue and is looking into how to resolve it, but at the time of publication could not give any further explanation or advice apart from suggesting those affected contact the Energy Saving Advice Service on 03300 123 1234.

Will the fund return?

As things moved very quickly this week, it's still not clear if or when more funding will be released.

The DECC spokeswoman says: "We'll now monitor voucher redemption rates and will consider whether to launch a further offer should funds become available."

For more details, see our Green Deal Mythbuster guide.