Major Retrofit Failings Exposed as Housing Association Commits to £72m Upgrade

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A scathing new National Audit Office report has revealed pervasive defects and potential fraud within government‑backed retrofit schemes, while a housing association steps forward with a substantial retrofit investment.

The NAO investigation found that 98% of homes fitted under the Energy Company Obligation (ECO) programme with external wall insulation affecting between 22,000 and 23,000 properties require remediation, with around 6% posing immediate health and safety risks such as damp, mould or insufficient ventilation. In homes receiving internal wall insulation, 29% are defective and 2% are judged to pose serious risks. As of September 2025, only 8% of external and 10% of internal faulty installations had been remedied. Remediation costs may range from £5,000 to £18,000 per home externally, and £250 to £6,000 internally; extreme cases have incurred costs exceeding £250,000 per property. The NAO also estimates that fraud may have cost taxpayers between £56 million and £165 million in improperly claimed payments. The investigation attributes these systemic failings to fragmented governance and weak oversight across DESNZ, Ofgem, certification bodies and energy suppliers, with no single body clearly accountable for quality control or consumer protection. DESNZ and Ofgem have since suspended several installer businesses, launched audits, and established a helpline for affected households, though the NAO describes these steps as reactive and insufficient, calling for a clear remediation timetable and assigned responsibility to repair all affected homes. The government has pledged to apply lessons learned to its forthcoming Warm Homes Plan.

Meanwhile, housing provider Riverside has committed to a £72 million retrofit programme targeting 3,064 homes across Liverpool, Halton, Carlisle, Middleton’s Langley estate, and Enfield in London. The initiative is supported by £36 million from the Warm Homes: Social Housing Fund (Wave 3) and matched by Riverside, building on a previous Wave 2.1 retrofit supported by £26 million that delivered upgrades to over 1,000 homes. David Morgan of WPS, which is delivering the programme, emphasised the benefits beyond energy savings improved warmth, lower bills, better health outcomes, and reduced environmental impact. Riverside, a major landlord with over 76,000 homes, is expanding its retrofit efforts across multiple regions.

Taken together, these contrasting stories paint a stark picture of the state of retrofit delivery in the UK: while systemic failures and poor quality threaten public confidence, some providers are demonstrating leadership with targeted, well‑funded programmes.

What this means:
Both reports underscore the critical need for stronger oversight, accountability, and quality control in retrofit programmes. The NAO’s findings highlight an urgent need for systemic reform across government‑backed schemes to restore trust and ensure the safe delivery of energy efficiency improvements. At the same time, the successful funding and rollout by Riverside signal that large‑scale, well‑managed retrofit projects are still possible and provide a model for effective delivery if accompanied by proper governance.

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