Reduced VAT may make Green Deal more attractive

According to a recent survey of FMB members in Great Britain, more than 70% think a reduced rate of VAT would be a “successful” or “highly successful” way of encouraging their customers to commission energy efficiency work.

Almost two thirds of FMB members (65%) think a free energy efficiency assessment would encourage more of their customers to improve the energy efficiency of their home. 

“It’s time for the Government to accept the Green Deal has not been a success,” says Chief Exec Brian Berry (pictured). “The FMB has worked hard to promote the Green Deal to small construction firms, but until our members see a clear demand for Green Deal work and a more straightforward route to the Green Deal market, they will not engage with the scheme.”

Berry points to the latest Government statistics showing that while over 70,000 Green Deal assessments have been undertaken to date, only 12 Green Deal Plans are ‘live’. He says this demonstrates that a growing number of homeowners want to improve the energy efficiency of their properties, but they aren’t interested in paying for it using Green Deal finance.

“A reduction in VAT would reduce the overall cost of the work and make Green Deal finance more attractive to homeowners who may be deterred by a large debt against their property,” adds Berry.

“Our latest research also supports the Government’s own findings that just having a Green Deal assessment is enough to encourage a significant number of people install energy efficiency measures in their home, regardless of how they choose to pay for it.

“Government research found that from a sample of households that had a Green Deal assessment, 81% have already, are in the process of or intend to install at least one energy efficiency home improvement.

"That’s why the Government should consider offering free energy efficiency assessments alongside a reduction in VAT.”