NAO Insulation Report 2024: Complete Analysis

Executive Summary

The National Audit Office (NAO) published its report on government insulation schemes in November 2024, exposing one of the UK's worst policy failures in recent history. The report concludes that the vast majority of homes that received external wall insulation under ECO4 and GBIS schemes will develop serious damp and mould problems.

The 30,000+ Homes With Defects

The NAO's most striking finding is that 22,000 to 23,000 of roughly 28,000 homes that received external wall insulation will "likely" or "very likely" develop damp or mould issues. This represents:

• 22,000–23,000 homes needing remediation — free to the household under the scheme guarantee
• Vulnerable households (the scheme's target) suffering most
• Health risks from mould exposure
• Significant property devaluation

Parliamentary Testimony

During parliamentary hearings, Jeremy Pocklington (then Permanent Secretary at the Department for Energy Security and Net Zero) admitted the government had identified "serious failings at every level" of the insulation schemes.

"We have identified serious failings at every level in the way these schemes have operated."
— Jeremy Pocklington, Parliamentary Hearing

What Went Wrong?

1. Trustmark Oversight Failures

Trustmark, the government-endorsed quality scheme, failed to prevent poor installations:

• Inadequate pre-installation assessments
• Minimal post-installation inspections
• No effective enforcement mechanisms
• Slow response to complaints

2. Inappropriate Technology

External wall insulation (EWI) was applied to properties where it was unsuitable:

• Solid-walled Victorian and Edwardian homes
• Properties with existing damp issues
• Buildings with poor ventilation
• Homes in high-moisture environments

3. Installer Quality Issues

Many installers prioritized volume over quality:

• Rushed installations to maximize subsidy payments
• Insufficient training in damp prevention
• Poor surface preparation
• Inadequate ventilation measures

4. Government Scheme Design

The schemes themselves were poorly designed:

• Pressure to meet installation targets
• Inadequate quality controls
• No long-term monitoring
• Insufficient consumer protection

Affected Schemes

ECO4 (Energy Company Obligation 4)

• Running: April 2022 – 31 December 2026
• Budget: £1 billion per year
• Target: Low-income and vulnerable households
• Primary issue: External wall insulation failures

GBIS (Great British Insulation Scheme)

• Launched: 2023
• Focus: Loft and cavity wall insulation
• Also experiencing high failure rates

Government Response

Following the NAO report, the government has:

• Acknowledged the "serious failings"
• Promised to improve Trustmark oversight (details pending)
• Committed to reviewing scheme quality controls
• Yet to announce compensation mechanism for affected homeowners

Media Coverage

The scandal has been covered extensively in UK media:

• BBC News: "Government insulation scheme failures 'scandalous'"
• The Telegraph: "Taxpayers face £200m bill for botched insulation"
• Which?: "ECO4 scheme: what went wrong and what to do"

What This Means for Homeowners

If you had insulation installed under ECO4 or GBIS:

• Monitor for problems: Damp, mould, condensation
• Document everything: Photos, dates, correspondence
• Know your rights: If it was external wall insulation under ECO4 or GBIS, the repair is free to you
• Get expert help: Independent surveys and specialist contractors
• Act quickly: Damp damage worsens over time

Download the Full Report

The complete NAO report is available on the National Audit Office website. It contains:

• Detailed statistical analysis
• Case study examples
• Government department responses
• Recommendations for improvement