The “squeezed middle” left exposed to £3.7bn leaky homes penalty if Chancellor cuts support, warns Citizens Advice
New analysis by Citizens Advice suggests the penalty for living in a cold, leaky home in England - where heat escapes through poorly insulated walls and windows - could reach £354 per household next year, following January’s predicted price rise. In total, this waste equates to a staggering £3.7 billion.
The charity is warning two million ‘squeezed middle’ households are potentially exposed to a double whammy of wasted heating costs and rising bills. They earn too much for low-income support towards energy efficiency upgrades, like double-glazing or better insulation, but cannot afford the thousands of pounds in upfront costs. The cost of double-glazing for a 3-bed house in the UK is typically between £8,000–£15,000.
Around one fifth of the government's Warm Homes Plan, which aims to make homes easier and cheaper to heat, has not yet been allocated since its launch earlier this year. Citizens Advice is raising concerns about the potential for this vital funding to be slashed to meet Treasury savings targets at the Autumn Budget. Whether the government raids unallocated funds or schemes like the Boiler Upgrade Scheme, the charity warns of a ‘death by a thousand cuts’, which risks leaving behind the skeleton of a plan that cannot deliver on its promise of warm, secure homes.
To bring squeezed middle earners into the Warm Homes Plan without taking money from low-income families, the charity is urging the Chancellor to protect the Plan’s entire budget and use unallocated funds to broaden its reach.
Seye Eneh, Information and Advice worker at Citizens Advice South West Surrey, said:
“Far too often we speak to people living in cold, poorly insulated homes. They are paying more and more just to stay warm, with their hard-earned money and heat literally escaping through drafty walls and windows.
“Despite their best efforts, these are working households who simply cannot afford the upfront cost of improvements that would bring their bills down. Because they earn just a fraction too much to qualify for government grants, they are left with no help to plug the leaks and no way to upgrade their homes on their own.”
Dame Clare Moriarty, Chief Executive of Citizens Advice, said:
"Heating an inefficient home is like trying to fill a sieve with water - it’s a monumental waste of money and leaves millions of families highly exposed to soaring winter bills.
“The government has promised to fix leaky homes and lower bills for good. To achieve this, it must recommit to the Warm Homes Plan - a vital lifeline for families who cannot afford essential home upgrades - and go further on emergency winter support.
“At the heart of these pledges are real people, worried about how they’ll afford to heat their homes. If the Chancellor chooses to cut energy efficiency funding to meet Treasury demands, the burden is firmly on ministers to explain how they will provide the help they’ve promised with less investment.”
-ends-
Notes to editors:
Citizens Advice’s analysis shows £5.7 billion has already been wasted this Parliament by over ten million households in England living in homes rated below EPC C.
The ”leaky homes penalty” figures for households in England are from Citizens Advice analysis of energy consumption by EPC. This is based on publicly available data on household energy usage by EPC, the number of households in England in different EPC bands and Ofgem’s price cap. Median gas and electricity consumption figures for households in EPC bands D-G were multiplied by the relevant unit rates for each period, and compared to the cost for households in EPC band C. For the £3.7bn figure, this used the predicted increased price cap which is set to come into force from January 2027. For the £5.7bn figure across this Parliament, this used unit rates for the period of July 2024 to September 2026.
Analysis by the Retrofit Policy Lab found that there is a ‘missing middle’ of 2.4 million homeowner households. They do not qualify for free upgrades under the Warm Homes: Local Grant (WH:LG), because their income is too high, but they can't afford to pay for a retrofit while meeting their minimally acceptable needs (as defined by the Minimum Income Standard). ‘Missing middle’ households are overwhelmingly families with children.
Unallocated funding from the Warm Homes Plan includes £2.7bn from the Warm Homes Fund (WHF), as well as £600m of the WHF that is earmarked to support low-income households but hasn’t yet been allocated. In addition, £428m has been assigned to “other programmes”.
The cost of double-glazing for a 3-bed house in the UK is typically between £8,000–£15,000 according to Checkatrade.
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