Warmer Homes Scotland - first annual review

Annual review of our Warmer Homes Scotland scheme, looking at delivery from September 2015 to March 2016.


5.0 Compliance review

5.1 Overview

We have reviewed the latest version of the PAS2030 document to determine whether there have been any changes to regulations for specified measures currently listed within the document, since the specification for the scheme was introduced. This was to ensure that all installations remained compliant and to the current standards.

5.2 Summary of Findings

Having reviewed the specification produced at the beginning of the programme, the version of PAS 2030 used and quoted in the specification was PAS2030: 2014 Edition 1. From this, Pennington then researched and reviewed the latest version of PAS2030 and found it to be same edition.

In the specification under each section for all measures, the Scottish Government have cited the key features directly from PAS2030, this includes information in relation to installation requirements, pre-installation requirements, surveyor and operative competence and any provision of information at the time of handover.

Within these statements there are variance guidance tables referenced which are shown on the PAS2030 document however these are not shown in the specification. These tables provide key guidance and knowledge in relation to the particular measure being used. From our recommendations section in Appendix 2, Pennington have recommended that the tables be made available so that the clauses and tables referenced in the specification can be viewed and understood. There is also reference to clauses 4 to 7 of PAS2030 made in every measure installation requirements section, these are then, however not shown in the specification. It is a further recommendation by Pennington to make these clauses available as part of the project specification so that these can be read and understood by the relevant personnel. Clauses 4 to 7 detail information and guidance in relation to the installation process, installation process management, service provision and claims of conformity.

As shown in Appendix 2 the process of making the clauses and guidance tables refers to all measures in Annex's B, C and D.

In terms of the 7 micro-generation measures that are available in the programme there have been updates to the standard documents since the specification was introduced. There have only been minor amendments to the text with most versions updating definitions and correcting cross referencing issues. A full breakdown of the amendments is shown in Appendix 2.

Overall there have been a limited number of changes in legislation and documentation to PAS2030 that will affect the programme of works or specification. Any minor amendments have been referenced in Appendix 2 however it is the view of Pennington that no action needs to be taken from these as they concern only slight changes to the structure of the document as opposed to actual legislative changes. It is recommended that the clauses and guidance tables referenced in the specification are made available so that these can be understood in conjunction with the specification.

5.3 Proposed VAT Considerations

On 9 th December 2015 HMRC issued a consultation paper in relation to proposed changes to the reduced rate of VAT for energy saving materials. The consultation set out when the reduced rate of VAT will and will not continue to apply. Subject to the changes to the list of installed goods included within the relief the reduced rate will continue to apply as it does now to supplies made to people living in dwellings who have a social need ('qualifying persons'), to supplies made to 'relevant housing associations' and to installations in all buildings used solely for a relevant residential purpose.

For 'qualifying person', the consultation cross references to the definition in Note 6 of Group 3 of Schedule 7A VATA (reduced rate for grant funded installations of certain goods) which relies on the same EU vires. This defines a qualifying person as someone who:-

a) is aged 60 or over;
b) Is in receipt of one or more of the following benefits
i. council tax benefit;
ii. disability living allowance;
iii. any element of child tax credit except the family element, working tax credit, housing benefit or income support;
iv. income based job-seekers allowance;
v. disablement pension;
vi. war disablement pension;
vii. personal independence payment;
viii. armed forces independence payment;
ix. universal credit.

We recommend that the Scottish Government cross reference the list with that of the eligible criteria for the Warmer Homes Scotland scheme. It is anticipated that the criteria for a 'qualifying person' under the VAT regulations and an 'eligible person' on the Warmer Homes scheme will be similar; however there may be small variances with the eligibility criteria. There may be circumstances where a customer eligible for the scheme is not a 'qualifying person' under the VAT rules. It is recommended that the Scottish Government review the impact this may have on the delivery of the scheme and develop a contingency plan in relation to grant funding levels to ensure the number of installs does not drop as result of the new legislation.

5.4 Oil Tank Regulation Considerations

As part of our brief we have reviewed the agreement between Warmworks and OFTEC in relation to replacing oil storage tanks when installing a new boiler. The agreed process is as follows -

If a tank is not to current standards but is not immediately unsafe then an installation can still proceed and the customer will be issued with an OFTEC approved advisory note. This has resulted in fewer installations being delayed because of issues in relation to tanks and or bases.

It is important to note that, where a customer's tank and/or base are immediately unsafe, Warmworks postpone the installation of the boiler until the customer has fixed the tank and/or base, using their own money as there is no support from the scheme. Feedback from Warmworks suggests that in most cases the customers are on low incomes and/or vulnerable which typically means that they are unable to replace the unsafe tank and/or base themselves and subsequently cancel their application.

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