UK Home Insulation Scandal Sparks Calls for Fraud Investigation

Published 23 January 2026

Highlights

• Over 30,000 homes have defects due to failed UK government insulation schemes, with 3,000 posing immediate health risks.
• The Public Accounts Committee has urged the Serious Fraud Office to investigate potential fraud by insulation installers.
• The Eco4 and Great British Insulation Scheme, launched in 2022, have been criticized for poor design and lack of oversight.
• Trustmark, responsible for quality assurance, failed to report high levels of faulty work until late 2024.
• The government promises repairs at no cost to consumers, but concerns remain about the adequacy of the financial guarantees.

Thousands of UK households are grappling with severe defects in their homes following the "catastrophic failure" of two government-backed insulation schemes. The Public Accounts Committee has called for the Serious Fraud Office to investigate potential fraud within the home insulation sector, as more than 30,000 homes have been affected by substandard installations since 2022.

Widespread Defects and Health Risks

The Eco4 and Great British Insulation Scheme, both part of the broader energy company obligation, have left approximately 3,000 homes with immediate health and safety risks due to issues like mould and water ingress. The schemes, intended to improve home energy efficiency, have instead resulted in significant damage, with 98% of homes with external cladding requiring repairs.

Calls for Accountability and Reform

Committee chair Sir Geoffrey Clifton-Brown described the situation as "the most catastrophic fiasco" he has witnessed, citing a lack of effective communication and oversight among responsible organizations. The committee's report criticizes the Department for Energy Security and Net Zero for its slow response and suggests that the schemes were "doomed to fail" from the start.

Trustmark, the body overseeing insulation quality, has been criticized for not alerting officials to the high levels of faulty work until October 2024. In response, Trustmark has pledged to work with the government and other stakeholders to rectify the issues, emphasizing the need for systemic reform.

Government Response and Consumer Protection

The government has assured affected homeowners that repairs will be conducted at no cost to them, with original installers liable for fixing problems. However, the committee warns that repair costs may exceed the £20,000 guarantee, raising concerns about financial exposure for homeowners.

Jonathan Bean from the charity Fuel Poverty Action has called for a public inquiry, stressing the need for immediate action to alleviate the suffering of vulnerable residents. The Labour government, which has since scrapped the schemes, faces additional costs to remedy the situation.

What this might mean

The unfolding insulation scandal could have significant legal and political repercussions. If the Serious Fraud Office finds evidence of wrongdoing, it could lead to prosecutions and further shake public confidence in government-backed retrofit initiatives. Politically, the Labour government may face increased pressure to demonstrate effective oversight and accountability in future energy efficiency programs. As the new warm homes plan rolls out, incorporating solar panels and heat pumps, it will be crucial for the government to restore trust and ensure robust quality control measures are in place.