Director of Built Environment Forum Scotland (BEFS) Craig Stirrat, soon to retire from his post there, has highlighted sector concerns over the balance of priorities in the Green Deal, noting that ‘It makes no sense to have solar panels and more efficient heating system, if… the building is crumbling and has a leaky roof!’
Craig writes:
Further to Joanne Wright’s email of the 24 November 2011 regarding the Green deal & ECO consultation published by the UK Government, the initial response from BEFS, as a supporter of the FMB Cut the Vat Campaign, is to point out that there is a major opportunity to use the green deal to take a more holistic strategic approach, which will encourage property and home owners to be more proactive about the maintenance & improvement of their property & homes – which in turn helps to reduce fuel poverty and carbon emissions.
It makes no sense to have solar panels and more efficient heating system, if fundamentally the building is crumbling and has a leaky roof!
BEFS Members believe a cut in Vat and the introduction of a Building MOT is an essential requirement for the improvement of the resilience of property (buildings and homes) against both natural decay (of stone and other building materials) and also the more unpredictable effects of climate change (as evidenced by masonry falls).
To this end, BEFS and the NFRC along with their respective members have been actively campaigning for the introduction of a Building MOT pilot scheme and supporting the FMB campaign on VAT.
BEFS Members also wholly support Fiona Hyslop’s, MSP Cab Sec, motion approved by Parliament to call “.. on the UK Government to reduce VAT for renovations, repairs and home improvements to 5%, which would act as a significant stimulus to the building industry ….”
The Cut the VAT Campaign argues that a reduction in VAT to 5% for all domestic Repairs Maintenance & Improvement works would bring thousands of empty properties back into use and help the Government achieve its target of cutting carbon emissions by 80% by 2050. It would also benefit millions of UK homeowners by helping to eliminate rogue traders, helping those who cannot afford vital repairs to their homes, encouraging the use of existing structures to rather than adding to the pressure on urban sprawl and greenbelt land, and by reducing the number of households in fuel poverty.
Based on the CFR/BSRIA 1996 survey of repair, maintenance and improvement (RM&I) expenditure, energy efficiency measures are estimated to account for 25% of total spending. Therefore, the energy efficiency market is currently worth around £3.6bn, of which £3.5bn attracts VAT at the standard rate.
?Estimated expenditure in 2010
|
Total expenditure |
|
| Double glazing |
£3120m |
|
Boiler only replacement |
£360m |
| Cavity wall insulation |
£46m |
| Other external wall insulation |
£5m |
| Loft floor insulation |
£36m |
| Roof insulation |
£19m |
| TOTAL |
£3480m |
UK Government ministers must help the private sector prepare for the Green Deal by stimulating further demand in the energy saving market.
At present, the VAT treatment of energy saving materials and microgeneration technologies is inconsistent. The measures highlighted in red in the table above already attract the reduced rate. However, double glazing and boiler replacement do not.
A flat rate of 5% VAT on all energy efficiency measures would result in fairer and more coherent treatment of the energy saving market. Our research shows that to levy VAT at a rate of 5% on the £1bn per year labour element of double glazing and boiler only replacements would cost just £151m per year.
BEFS: LINK
