Government’s £15bn heating plan leaves the poorest out in the cold, according to new study

The Warm Homes Plan promised warmer homes and lower bills, but follow the cash and most of it flows to households that need it least

The government’s £15 billion plan to heat British homes is set to hand most of the money to households that need it least, while the poorest stay cold, damp and skint.

That is the warning from researchers and campaigners picking apart the Warm Homes Plan, launched in January. It promises to swap gas boilers for heat pumps, fit insulation, and put solar panels and batteries on roofs. Good aims. But the cash is flowing in the wrong direction.

Follow the money. Just £4.4 billion is earmarked for low-income homes and the most urgent upgrades. Most of a £5.3 billion fund and a £2.7 billion boiler scheme goes in grants and loans to better-off households. Often they still have to top it up with their own cash. If you can already afford the bill, the state helps you pay it. If you can’t, you wait.

Madeleine Pauker, an energy researcher at the University of Sussex, put it plainly. The danger, she said, is that subsidies “flow to the more affluent owners of homes in the best condition, that are already decently insulated.”

The last lot of firms trashed people’s homes

We have been here before. The previous insulation schemes were a scandal. The National Audit Office found “major issues requiring remediation” in 98 per cent of homes fitted with external wall insulation. Contracts went to certified installers, who sub-contracted to small firms, who cut corners. Some were incompetent. Some were corrupt. In April the Serious Fraud Office made four arrests.

Poorly insulated homes were left colder and damper than before. The people doing the work were left underpaid and undertrained. Two sides of the same rotten coin.

There are fewer than 4,000 qualified heat pump fitters in the country. The government reckons it needs tens of thousands. Its answer is an £8 million training pot that campaigners call “utterly inadequate to the scale required.”

Landlords get the grant, tenants get the bill

The plan pays upgrade grants straight to landlords in the private rented sector. Campaigners fear what comes next: rent hikes, evictions, flats flipped to holiday lets, all dressed up as home improvement. It has happened before.

If the work is botched and bills go up, a tenant’s only route is a maze of complaints procedures. And landlords are not required to make the changes until October 2030.

Even with a heat pump, your bill might not budge

Here is the sting. For many families, a heat pump would not save a penny. Electricity costs households around five times as much as gas per unit of energy, roughly 27.5p a kilowatt hour against 5.5p. Heat pumps run more than three times as efficiently as boilers. Do the maths and you can still end up paying more.

That is not an accident. Wholesale electricity prices are set so every generator pockets the price of the most expensive power bought that day. Cheap clean power gets chained to costly gas. Your bill stays high. Someone profits.

Fix the prices, insulate the homes that need it most, and train the workers to do it properly. Warm homes and lower bills are within reach. Right now the money is heading for the people who need it least.