LABC WArrAnty retrofit deBAte | SPONSORED FEATURE
the retrofit
deBAte: A strong
Argument
for puBLiC
expenditure
A panel of experts, from fields including construction, local government, insurance
and social housing, gathered to discuss how to bring about a national retrofitting
programme to make the nation’s existing building stock carbon neutral. And, make no
mistake – this isn’t just about saving polar bears. There’s a strong economic case for it
o
ur capabilities in sustainable design and
construction have never been so great, yet
most properties in Britain still emit vast
amounts of carbon. While new-build zero-carbon
buildings are a source of inspiration, it is the less
glamorous adaptation of existing homes and offices
that will be crucial to meeting carbon reduction targets.
Building, Ecobuild and LABC Warranty gathered a
panel to discuss how the nation might go about
retrofitting its entire building stock. Experts from fields
including construction, local government, insurance and
social housing, agreed that the scale of the challenge is
daunting, and made worse by the state of the
economy. But opportunities to promote retrofitting
were also identified, and – perhaps most importantly
– consensus was reached on a strategy to help sell
retrofitting to politicians and the public.
The government must be persuaded that making a
national retrofitting programme a reality should be a
priority. But, Lord Richard Best, president of the Local
Government Association and chairman of Hanover
Housing Group, expressed a view that many had feared.
“I detect a distinct cooling in central government
towards the whole sustainability agenda,” he said. “The
government just wants to save money and
sustainability is an expensive thing to get involved in.”
the panel
tom Broughton brand director, Building &
Ecobuild (chair)
gary devaney chairman, LABC Warranty
paul everall chief executive, LABC
Ashley powell business development
manager, Breyer Group
howard Jones business development
manager, Connect Property Services
nigel ingram director of development and
property, Joseph Rowntree Foundation
professor Anne power professor of social
policy, London School of Economics
Lord richard Best president, Local
Government Association
neil Cutland director, Cutland Consulting
Leonie Cooper consultant, Sustainable Homes
tony millichap technical manager, Kingspan
Insulation
eco Will be flying off
the shelves. £1.3 billion
Will not be enough
leoNie Cooper, sustaiNable Homes
Photography: Paul Burroughs
Nevertheless, politicians are, for now, pressing on
with initiatives such as the Green Deal, which
launched last month. Property owners can take out
loans for energy efficiency improvements, which
are repaid through subsequent savings on energy
bills. Firms in sectors such as contracting and
materials manufacture have long-awaited the Green
Deal’s arrival, hopeful it will provide a major source
of work. But doubts have been raised about the
extent of its impact.
Lord Best questioned whether the level of interest
being charged on the loans would tempt homeowners.
“From the perspective of the consumer, if you’re
going to be borrowing at 7%, what are you doing?”
he said. “If you’ve got a mortgage, add £5,000 to
that. Or, if you’ve got money in the building society
earning 1.5%, use that.”
The amount of money on offer is another point of
concern. Pilot schemes such as Retrofit for the Future,
run by the government’s Technology Strategy Board,
have seen costs as high as £150,000 per home
– significantly higher than the cash available through
the Green Deal. Neil Cutland, director of Cutland
Consulting, observed: “We’re not just talking about the
£6,000-10,000 being offered by the Green Deal here.”
Initiatives such as the Energy Companies Obligation
(ECO) are viewed with more optimism. The programme
is funded by large energy companies and is expected to
fund home improvements worth around £1.3bn a year.
Hopes were raised that this figure may be bumped up
to meet demand. Leonie Cooper, a consultant at
Sustainable Homes, said: “ECO will be flying off the
shelves. There will be a need to increase it if at all
possible. Just £1.3bn will not be enough.”
What does Work is
legislation – making
things compulsory
– and grants
Neil CutlaNd, CutlaNd CoNsultiNg
LABC WArrAnty retrofit deBAte | SPONSORED FEATURE
Although the amount of money on offer is a major
concern, the available supply chain to carry out work
could also be an issue. Ashley Powell, business
development director at Breyer Group, said: “We should
be learning lessons from the time we had to train a lot
of people to install photovoltaics. We have to do the
same thing with the Green Deal and ECO.”
i detect a distinct
cooling in central
government
toWards the Whole
sustainability agenda
lord riCHard best, lga
Not everyone agreed this was the main priority at
the moment. Tony Millichap, technical manager at
Kingspan Insulation, joked: “It would be a nice problem
to have if we had a load of volume to deliver and not
enough skilled operatives.”
Housing associations have made some of the best
progress on retrofitting programmes. But financial
pressure in the sector risks putting a brake on progress.
Howard Jones, business development manager at
Connect Property Services, part of the Aldwyck
Housing Group, said welfare reform had given rise to
concerns about the ability of tenants to pay rent and
a subsequent fall in income for housing associations.
He said raising awareness of how retrofitting can
increase the value of properties would make it easier
for landlords to access the finance they need to fund
improvements. “If financial institutions recognise the
point about asset value it will enable Registered Social
Landlords (RSLs) to borrow more to increase that asset
value, and you then get the opportunity to put
programmes together,” he said.
Paul Everall, chief executive at LABC, wondered
whether introducing warranties for retrofitting work
might help in this regard. “Very few people would buy a
house without it having a 10 year structural warranty,”
he said. “Would it be useful for housing associations
and other providers to have a stock regeneration
warranty in place?” Jones said: “Warranties for these
measures, to give comfort to social landlords, is
something that would hopefully encourage them to
going through it
street by street
Would be the real
Way to tackle this
paul everall, labC
invest further.” But he added: “My worry is that it
comes down to money at the end of the day.”
Powell agreed that the amount of money involved
was likely to prove a barrier to social landlords. “We’ve
participated in two pilot schemes and if you’re working
towards zero-carbon you need to spend probably
£150,000 a dwelling,” he said. “We can’t foresee that
our affordable housing clients are going to want to
spend that level per unit.”
i don’t see that
regulation is
going to get much
political traction
Nigel iNgram, JosepH rowNtree FouNdatioN
While there will always be costs associated with
retrofitting, there are ways these can be driven down.
Retrofitting several properties at once – for instance,
insulating terraces rather than individual houses – can
be a much more efficient option for social landlords.
Not only is it cheaper to buy labour and materials en
masse, but the technical nature of retrofitting several
properties at once can provide savings.
But, tackling retrofitting in bulk provides its own
challenges. Housing associations can take this approach
with their own stock, but it’s hardly an option open to
the average private householder. Anne Power,
professor of social policy at the London School of
Economics, suggested that local authorities may have a
role to play in leading retrofit programmes outside of
the social housing sector. “Somebody clever needs to
come up with a new proposal as to how you could fit
together local authority incentives and ECO incentives,”
she said. “It shouldn’t be beyond the wit of the larger
type of authorities, like Manchester or Birmingham.”
It was agreed that if retrofitting is to take off, it will
require partnerships between the private and public
sectors, as well as RSLs. Everall said: “Getting people to
work together to improve areas and not just individual
properties is important.” But he questioned the
enthusiasm among those who need to be involved.
“Going through it street by street would be the real
way to tackle this if the will was there, but it isn’t.”
Cutland suggested that widespread action on
retrofitting would be unlikely to happen without
intervention from central government. “History shows
that voluntary take up of energy efficiency measures
just doesn’t happen,” he said. “What does work is
legislation – making things compulsory – and grants.”
Such a move would be at odds with the current
administration, which has made a radical reduction to
regulation in areas such as employment law and
planning a key part of its strategy for economic growth.
Nigel Ingram, director of development and property at
the Joseph Rowntree Foundation, said: “I don’t see that
regulating for this is going to get much political traction.
Red tape is seen as bad, even though it’s possibly the
best way to go about achieving this objective.”
Most parties with a role to play in retrofitting still
require persuasion, and arguments about sustainability
form only one part of the package. The panel agreed
that three key benefits should form the centrepiece of
efforts to sell the retrofitting concept. Ingram said:
“Economic benefits, like job creation, the environmental
confidence in what we are doing, and the social aspects
of how this helps encourage people to squirrel savings
away – that is the trio of things to help promote it.”
Lord Best agreed that this approach would also be
essential to persuade Whitehall of the continued value
Warranties for stock
regeneration projects
the regeneration and retrofitting of existing
social housing stock has many benefits, both
social and economic, but, as with any investment
you must ensure you are protected from
potential risk. structural warranties are required
for new build properties but with the extensive
investment required for raising housing
standards, labC warranty has developed a
warranty for stock regeneration/retrofit projects.
labC warranty chairman gary devaney
explained that the company decided to offer this
warranty to give those thinking of embarking
on regeneration projects more confidence and
security to do so. He said: “with potential issues
on training and the like, from our perspective
there is a need for a warranty [on retrofitting
work] to provide some certainty”
this reduces the financial risk for housing
providers, improving potential funding
arrangements for further development.
types of work covered include:
• New roof structure
• replacement windows and doors
• improvements to external walls and installation
of insulation
• internal alterations (new partitions, removal of
walls and/or ceilings, etc.)
for more information on the policy cover, visit
www.labcwarranty.co.uk or call 0845 054 0505
in retrofitting. “Emphasise the labour intensity – more
jobs at a time of unemployment; the impact on fuel
poverty; and then throw in the old environmental
aspects for good measure,” he said. “It’s a
demonstrably good argument for public expenditure.”
According to Ingram, the effort to sell the idea of
retrofitting has been the biggest failure to date. “I think
we’ve got the skills and we could find the finance.
What we’re poor at is finding the hook to convince
people,” he said. “We’re not very good at marketing it.”
Partnerships between the public and private sector,
increased levels of grants, and more regulation may all
play a part in taking retrofitting mainstream. But
success depends on persuading all interested parties it’s
worth pursuing. As Cooper said: “The whole idea of
saving polar bears and icebergs is not the way to sell it.”
Renewed efforts must be made to get everybody on
board. At a time of economic hardship, moral
arguments alone are unlikely to be enough.
IN ASSOCIATION WITH
Gary Devaney, LABC Warranty chairman
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