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Landlords warned about insulation letters as government scraps ECO scheme

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Landlords warned about insulation letters as government scraps ECO scheme

Landlords are being urged to look out for letters about faulty insulation and upcoming repair plans.

As previously reported by Property118, the National Audit Office (NAO) found that 98% of homes fitted with external wall insulation under the government’s ECO4 scheme need remedial work to fix serious issues that could cause damp and mould.

Despite this, the government has not yet confirmed a timeline for repairing affected properties, even though Chancellor Rachel Reeves announced in the Autumn Budget that the ECO scheme will end in March next year.

Only 2,900 homes fully repaired

Earlier this year, the government suspended 39 businesses from installing solid wall insulation after routine checks revealed major failings, pledging that installers would be required to fix the defects free of charge.

However, by mid-September 2025, only 2,900 homes had been fully repaired.

The National Residential Landlords Association (NRLA) says landlords whose properties had insulation installed under the ECO4 or Great British Insulation Scheme (GBIS) should expect a letter from Ofgem if the work is below standard.

As the letter will be sent directly to the property, the NRLA is urging landlords to tell tenants to look out for the letter and inform them immediately once it is received.

The government is also calling on anyone who receives an audit invitation to allow qualified professionals access, allowing problems to be identified and fixed.

The government adds that even if the original installer is no longer operating, ECO4 or GBIS should be covered by guarantees.

Government will scrap ECO scheme in March 2026

The news comes as Chancellor Rachel Reeves announced in the Budget that the government would scrap the ECO scheme to save money on energy bills and replace it with the Warm Homes Plan.

However, as previously reported by Property118, despite the Warm Homes Plan being scheduled to launch last month, a government minister has admitted the scheme will now roll out “before the end of the year.”

The Warm Homes Plan aims to help homeowners cut energy costs and improve home energy efficiency, offering grants for heat pumps and support for renters and low-income households.

However, industry experts have criticised the government for scrapping the ECO scheme.

Anna Moore, CEO and founder at retrofit consultancy Domna, said: “The Warm Homes Plan is a welcome initiative. However, suddenly yanking £1.3 billion in funding is chaotic and has created a cliff edge for thousands of low-income households in fuel poverty, as well as small and medium-sized enterprises (SMEs) employing some 10,000 people.

“With fuel poverty growing and business under pressure, it beggars belief that a successful scheme funnelling utility firm funding to the poorest households in society should be brutally cut. And for what? To create a few short-term headlines around cutting Net Zero levies.”

She adds: “This fundamentally goes against Labour’s stated values of wanting to help the poor and to fight climate change. This is not the moment to pull up the ladder. Bridging ECO to the Warm Homes Plan is essential if we are to protect residents, protect jobs and protect progress.

“Right now, we risk losing the installers, coordinators and surveyors – those SMEs who have built up capability over a decade, and whose expertise we critically need. Companies cannot simply be switched back on later like a light switch and the ramifications of this could massively undermine our wider battles to fight climate change and upgrade our ageing housing stock.

“We need clarity and continuity. Extending ECO by one year allows an orderly transition while the Warm Homes Plan is finalised, piloted and mobilised. Without that extension, the sector falls off a cliff in March 2026 and we will be rebuilding capacity from scratch at exactly the moment the government needs to accelerate delivery.”

The post Landlords warned about insulation letters as government scraps ECO scheme appeared first on Property118.

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