Cavity Wall Insulation

[Mrs Pauline Latham in the Chair]

I beg to move,

That this House has considered the provision of cavity wall insulation under Government grants.

I start by thanking you, Mrs Latham, for chairing this important debate. What a pleasure it is to see you.

The problem I am going to outline starts with Government grants for cavity wall insulation schemes, but I wish it ended there. Sadly, it doesn’t. I am grateful to the Minister for her time last week: I had the opportunity to brief her on the scale and nature of the problem, which I can only describe as a scandal upon a scandal. I also want to thank The Yorkshire Post, God’s own newspaper; its editor, James Mitchinson; and the deputy business editor, Greg Wright. They recognised the agony of ordinary people in what is a complicated legal mess and have worked hard to unravel it and tell those stories, and I am truly grateful to them for their diligence and painstaking work in shining a spotlight on this situation.

I am working with 20 constituents in my Halifax constituency who have all been affected. However, figures quoted by the BBC indicate that up to 1,400 people may have been impacted. More and more MPs are taking to the Chamber and writing to Government Ministers with their concerns and their local cases. Most of the cases I am working on follow a similar pattern. People had a knock on the door in around 2015 or 2016 and were asked whether they would like cavity wall insulation. They were assured that it would not cost them a penny because it was a Government-funded scheme. They were told it would be better for the environment, help them to reduce their energy bills and save them money. Most of the people who had the knock on the door were eligible for the scheme on the basis that they were in receipt of some form of welfare support, so the prospect of saving money on energy bills was an attractive one.

Yet months and years later, mould and damp started to affect properties where it had never been an issue before. In some cases, I have seen families become really quite unwell living in these conditions, and they could not understand what had changed so drastically in their homes. Years later, people had a second knock on the door from representatives of law firms, who often told them that they should not have had cavity wall insulation in the first place; that it has done damage to their homes that would cost thousands to fix; and, if they wanted the situation resolved, they should allow the law firm to take the insulators, many of which have since disappeared, to court on a no win, no fee basis. These cases were taken on by SSB Law, which corresponded with my constituents for some time until, just before Christmas of last year, these families and individuals received enforcement notices telling them they owed thousands of pounds in legal fees and that, if they did not pay them, bailiffs would be coming to their homes. One bill was for £18,000, one was for £32,000, and there were a range of amounts in between and beyond.

Bearing in mind that people were usually eligible for the Government-funded schemes on the basis that they were in receipt of some form of welfare support, these bills have devastated people who simply have no means of paying them. It is hard to overstate the impact that this has had on people’s lives. One of my constituents, Mr Zafar, is featured in the extensive coverage by The Yorkshire Post. His home was visited by a representative from a law firm in 2019. His wife was told that cavity wall insulation which had been installed a few years earlier was unlawful and potentially harmful to their children’s health. This representative persuaded Mr Zafar that they should take on the case on a no win, no fee basis. The case was subsequently transferred to SSB Law solicitors, who handled the case for nearly two years. Then, on 30 January 2023, Mr Zafar received a first enforcement letter demanding £2,973. He contacted SSB Law Solicitors and was assured via email that the payment had been made to the High Court bailiff. Despite this assurance, on 28 November 2023, he received another enforcement letter, this time for nearly £19,000. Distressed by this demand, he made inquiries and learned that SSB Law solicitors had gone into administration. He contacted Leeds High Court, requesting the suspension of the enforcement order. However, just a few days before Christmas last year, an enforcement agent visited his home while he was at work, leaving his wife terrified.

Mr Zafar said:

“I can’t work properly and me and my wife can’t sleep. The amount in the enforcement notice is always on my mind. Wherever I go, I have on my mind the fact that I must pay £19,000…My kids asked me, ‘Dad, have you done anything wrong? Why are you paying this amount? Are we going to end up homeless?’…I just want to release my family from this stressful and horrible situation.”

Another Halifax constituent, Mrs Battye, was told that cavity wall insulation would make her home more energy efficient, more environmentally friendly and would improve heating costs—as we all know, if it is done properly, that is all correct. However, in the following months, she started to notice damp and mould appearing in her front and back bedrooms—that was not a problem she had ever had before. Then in 2020, someone knocked on Mrs Battye’s door and asked whether there was any damp in the property. This man told her that the cavity wall insulation should never have been installed in the first place, and this had now caused extensive issues at her property. He stressed that it would be difficult and expensive for her to rectify, which she could not afford.

She said:

“He advised me to submit a claim for damage done to the property through a no-win, no-fee claim. I was assured I would not have to pay anything and this was the best way of rectifying the problem.”

Over the next four years, Mrs Battye received correspondence from SSB Law in relation to her case, but like the others, just before Christmas last year, she received a letter from High Court enforcement, informing her that she was liable to pay £32,000 to the defendant’s solicitor.

Mrs Battye lives alone and works for the NHS on what she describes as a modest salary. She said:

“I have no means to pay this money and I am worried about bailiffs coming to my house and getting a CCJ or a charging order on my property.”

Another constituent, who does not want to be named, said she had cavity wall insulation fitted—work in which she had confidence, on the basis that it was funded under a Government scheme. In the months that followed, she and her young son contracted pneumonia, living in a house with mould and damp—again, that was not a problem they had ever had before.

She said:

“I kept changing my wallpaper and house decorations to try to cover the mould…Because SSB Law was a big company, I believed they were definitely going to help us.”

On 5 December 2023, my constituent came home to find an enforcement letter at the back of the door. It said that she must pay more than £17,000, otherwise bailiffs would be dispatched to her home.

She said:

“It was just so shocking. My entire credit history had been damaged. My credit card has been suspended. For 10 days, I couldn’t sleep. I’d borrowed some money, I thought about selling my jewellery…It’s really hard for me. Every day, I’m thinking, ‘How am I going to be able to pay this money back?’ It’s affected my mortgage and affected my credit history. It’s affected my daily life.”

This lady was so terrified that she managed to borrow money to pay the debt she had no idea she was liable for, just to alleviate her fear of bailiffs coming to her home. However, she now worries every day how she will pay back that loan.

Mr Goodey, a constituent with a similar story, said:

“The amount of stress this has put myself and my family through is grossly unfair. I’ve since learnt that the construction and age of my property means it is unsuitable for expanding foam cavity filling and should never have been used in the first place. I’m a widowed 65-year-old who is due to retire this year with an 18-year-old son who will inherit the house eventually. I do not want him to inherit this problem.”

The Minister will see what a profound, life-changing impact this scandal has had, and is continuing to have, on people. The Solicitors Regulation Authority is investigating SSB Law, which is welcome. In a letter to me, from 23 February, it confirmed:

“We are currently investigating to see if the SSB Group acted in accordance with our Standards and Regulations. This will include whether the firm properly assessed the merits of claims, whether your constituents were properly advised at the outset on potential liabilities arising from initiating litigation, even if this was on the basis of a ‘No Win, No Fee’ agreement.”

It said:

“We will also be looking at the handling of the files and the arrangements for after the event insurance, the failure of which appears to be the main reason why your constituents are facing the prospect of demands for costs.”

Crucially—and I really welcome this—the letter from the chief exec of the SRA states:

“After the event insurance has been around for several years and is frequently used in ‘No Win, No fee’ agreements. We are not aware of similar circumstances to those your constituents now face, being experienced on this scale before. As such, we will also be speaking to a number of organisations to explore whether the numbers of cases where the failure of after the event insurance is increasing, or whether there are any wider gaps in protection to consumers that need to be addressed, given the importance of such products to individuals pursuing civil redress.”

I really welcome this investigation, which I hope will be comprehensive in assessing what has gone so horribly wrong for so many people, but the SRA advises that it is expected to report in the autumn. While we have had some success in managing to get some of the enforcement notices paused, they hang over constituents like the sword of Damocles. I therefore ask the Minister to help move this to a permanent resolution.

As I acknowledged at the beginning of my contribution, this all starts with cavity wall insulation, but I am acutely aware that the scandal has grown tentacles into a number of Government Departments and policy areas. My first ask of the Minister is that she makes representations to her colleagues to see what else can be done to hold the insurers and law firms involved to account. I am afraid to say that the responses so far from Ministers at the Ministry of Justice have been less than useless. The SRA investigation is significant, and I am hopeful that it will expose what has failed so badly. I would urge the SRA to consider making recommendations to Government and the other relevant agencies, with a view to fixing whatever its findings deem so broken that it has had an impact on 1,400 people. I would ask the Minister to liaise with the SRA to provide any support that she can, so that if there is any way to accelerate the investigation that is made a reality. Given that the SRA might not be the right body to investigate why after-the- event insurers have failed in this scenario, I hope the Minister will also consider ways in which any further regulators or agencies could be instructed to investigate and made to understand the scale, seriousness and urgency of this situation.

Returning to the Minister’s brief, I have been reassured to some extent that oversight and regulation of cavity wall insulation—which is such a good thing when done well—has improved since the energy company obligation 1 and energy company obligation 2 schemes, having discussed this in some detail with experts. However, there are still many people out there who do not know where to turn with cavity wall insulation problems dating back to that period. That problem has been exploited by some of those agencies, leading to the problems we now have.

CIGA—the Cavity Insulation Guarantee Agency—issues guarantees for cavity wall insulation and has issued almost 6.2 million since 1995. It operates a scheme that puts right failures in materials or workmanship for a period of 25 years from the date of installation, and many of my affected constituents could have explored this as a first step in seeking advice and redress. CIGA, in its correspondence with me, stresses that often homeowners were actively told not to lodge a claim with the guarantee provider, who could take action to correct the problem under guarantee, but who instead made, in these cases, false promises of a pay-out in court.

One of the questions I asked on behalf of people with cavity wall insulation who received a knock on the door from someone representing a law firm, was where did that person get their intelligence so they knew where to knock? CIGA suggests that the claims solicitor model relied on farming a large number of potential claims using data accessed either through freedom of information requests from Ofgem, or under the guise of the Data Protection Act, in an attempt to access their own guarantee records. Having gained information on properties where insulation had been installed, unqualified assessors were sent out to encourage the homeowner to pursue a claim. In most cases, they inflated any potential damage or indeed alleged damage that simply did not exist, with the subsequent report signed off by unscrupulous chartered surveyors registered with the Royal Institution of Chartered Surveyors. The Minister can see just how much all of this stinks.

I ask the Minister to undertake a review into the whole sorry mess. It is a scandal upon a scandal, which has affected these vulnerable people, up to 1,400 of them, who in some cases have chronic problems with damp and mould in their homes as a consequence of a Government-funded scheme. They were then preyed on by unscrupulous assessors and lawyers, falling through the cracks of regulation and mismanagement, and we find that the people who could least afford or least deserve it were picking up the bill, driving them into debt and despair. I look forward to the Minister’s response.

It is a pleasure to speak in this debate and to serve under your chairmanship, Mrs Latham. I thank the hon. Member for Halifax (Holly Lynch) for leading the debate. Things are different in Northern Ireland, and it is not the Minister’s responsibility to reply for Northern Ireland, but I wanted to come along to support the hon. Lady in her request for justice. Ultimately, that is what she is looking for: justice for her constituent. Hon. Members who speak after me will be seeking justice, too. The scheme was for England, Scotland and Wales—the Northern Ireland scheme is different—but I support the hon. Lady.

In my research for this speech, I read the background information, and today I have listened to the hon. Lady’s comments about the despair that some people feel. She referred to one lady who was unable to sleep for 10 nights, such was her trauma and concern. That level of concern was financial, ultimately, and she was presented with a huge bill. We have heard about figures of £17,000, £25,000 or £35,000, which indicate just how worrying the issue can be. People do not understand why they are in that position, because that was not what they signed up for.

The hon. Member for Halifax was right to set the scene. She described the financial ruin that her constituents have faced, with unexpected legal bills running to tens of thousands of pounds. Without doubt, more needs to be done to support those families and protect people from such schemes in future. It is not only about helping people with the problems that they have today, but about ensuring that such things do not happen again. [Interruption.] I think there must be something wrong with the plumbing, Mrs Latham: there is definitely a background noise. Whatever it might be, I am sure that it will not silence me or anyone else.

It is important that all constituents have good access to thermal insulation to prevent heat loss in their home. I will give some examples about our heat loss and cavity wall insulation schemes in Northern Ireland. We were able to sort the problems out, by the way, and we did not have individual companies soliciting round the doors for no-win, no-fee representation. There is no doubt that the insulation process is expensive, and many will struggle to pay for it. The Government need to be commended for what they do: it is incredible that we have schemes to enable people to upgrade their homes and ensure that they have the levels of insulation and heating that we all need.

I am sorry for the buzzing noise that we can hear in the background. The Doorkeepers have contacted the engineers, and they are going to address the issue. Meanwhile, it is quite difficult to hear—I cannot hear from the Chair what is being said—so can people speak up so everybody can hear?

It is an honour to serve under your chairmanship, Mrs Latham. I congratulate my hon. Friend the Member for Halifax (Holly Lynch) on securing this very important debate. I am pleased that it has cross-party support, as the hon. Member for Strangford (Jim Shannon) said, and that there are shared concerns about this shocking situation.

This is a real opportunity to seek clarity and pursue justice for all our constituents who have been affected by this shocking affair. The human toll of the SSB Law crisis is significant and has undoubtedly caused considerable shock, anger and distress to those affected. I have met multiple constituents over the past few weeks to discuss the impact of the collapse of SSB Law. I have heard at first hand how the devastating situation has had a severe impact on them, their loved ones and their lives. I have seen the damage to their homes, which is shocking, considering that the Government spent millions of pounds on the scheme. It is leaving families in a terrible situation.

The situation goes on. People are receiving letters threatening court action. Several of my constituents are in real fear of losing their home. It is shameful and outrageous that people have been misled. We need to demand justice for those who have been targeted. My hon. Friend the Member for Halifax mentioned the data on who was affected by the scheme; it must have been shared. That must be investigated.

I am one of 20 MPs who have signed early-day motion 423, which calls on the Government

“to ensure that all demands for payment and court orders resulting from the collapse of SSB Law are dropped immediately”.

We need to take pressure off these families.

It is significant that the situation has arisen from the poor implementation of a Government-backed decarbonisation scheme. The Government must therefore be held accountable for the crisis that ensued. The failure on the Government’s part to ensure the proper implementation of the insulation scheme means that we must now firmly commit to upholding the rights and protecting the wellbeing of citizens. People are living in unsafe homes, with damp and mould threatening their physical and mental health.

If we are not forceful and succinct in our approach to solving the crisis, we could see serious or potentially life-threatening health issues developing. One mother told me the story of her little boy who suffers severely with asthma; she is really concerned about him. It is vital that we work across the parties to ascertain the true scale of the crisis and find a solution for affected constituents as the scope of the problem comes to light. I am sure it will continue to grow.

It is a privilege to see you in the Chair, Mrs Latham. I pay tribute to the hon. Member for Halifax (Holly Lynch) for securing the debate and for telling us about the experiences of her constituents as well as the problems that they have had after having cavity wall insulation fitted to their homes. Some of the problems might have arisen from very poor ventilation as a consequence, and it is troubling to hear about that.

On the doorstep, I have come across constituents who have suffered from mould and damp. I have also talked to an employee of East Devon District Council who is responsible for the maintenance of social homes and who has said to me that some of the issues with damp and mould are linked to cavity wall insulation. Done properly, cavity wall insulation is a positive thing. It keeps people warm and saves money for the Government, taxpayers and individuals. It is one of those rare policy areas that is not just a win-win, but a win-win-win.

On the subject of heating, the End Fuel Poverty Coalition estimated that 4,950 people in this country died in the winter between 2022 and 2023 because they were living in cold conditions. Clearly, worries all of us. I know that the Government were also concerned, because they introduced the energy price guarantee. On the face of it, the energy price guarantee was a very popular policy because it reduced people’s energy bills by a very significant amount, although many of my constituents will not have felt it because their energy bills were still staggeringly high in that winter of 2022-23. The energy price guarantee was a subsidy from the Government—from the taxpayer—of £37 billion. The really sad thing is that had the Government continued to invest in home insulation measures at the rate they had been in 2012, a large proportion of the funding spent on heating people’s homes and subsidising their heating would not have been necessary.

The third win is, of course, in the reduction of emissions. Given the concerns that the Government might not reach their net zero target by 2050 and that the world might not meet the target of reducing temperature rises by 1.5^°, we absolutely have to be concerned about reducing emissions, too. Heating homes, saving money and reducing emissions are all things that can be achieved with cavity wall insulation done properly.

It is of course a pleasure, Mrs Latham, to serve with you in the Chair. I join colleagues in thanking my hon. Friend the Member for Halifax (Holly Lynch) for securing this very important debate.

My hon. Friend quite rightly pointed out the importance of this debate, as did my hon. Friend the Member for Blackburn (Kate Hollern) and other hon. Members. Indeed, it is very important to many of our constituents, who are suffering the results of some of the scandalous actions that we have heard about. Many of them are having sleepless nights and are threatened with financial ruin, which I will say more about a little later.

As other hon. Members have said, with the promise of reducing energy bills and with the Government’s stamp of approval, cavity wall insulation schemes were an attractive proposition that were readily signed up to by many people, including many of my constituents in Bradford East. However, the reality was a far cry from the promise of warmer homes and lower bills. Cavity wall insulation has now left many of them facing financial ruin, because, after it was installed, they began to notice, as many other hon. Members have said already, damp and black mould was growing on walls, ceilings, window ledges and floors in their homes, and their electrical systems were compromised. Their homes became harder to heat and in some cases skin conditions increased. Also, many experienced mental stress, because they constantly had to deal with the problem. It is important to mention the real-life consequences for our constituents.

The cavity wall insulation that was supposed to keep their homes warm instead acted as a bridge to draw in the moisture from the external walls and transfer it inside their homes. Although cavity wall insulation was an excellent way to improve energy efficiency in many homes, which it is if it is correctly installed, in those cases it was discovered tragically that those homes were never suitable for cavity wall insulation or that the work that had been carried out was defective.

I congratulate my hon. Friend the Member for Halifax (Holly Lynch) not only on securing this important debate but on making the detailed case that needs to be made about his scandal. The contributions of hon. Members from across the Chamber have added to her exemplary presentation, and have underlined the urgent need to do something about the issue. My hon. Friends the Members for Blackburn (Kate Hollern) and for Bradford East (Imran Hussain) and the hon. Members for Tiverton and Honiton (Richard Foord) and for Strangford (Jim Shannon) all made first-class contributions to the debate.

Cavity wall insulation has played, and will continue to play, a tremendous role in keeping people’s homes warm, reducing bills, fighting fuel poverty and uprating homes so that they are fit for a low-carbon future. Indeed, the vast majority of cavity wall insulations work perfectly well and do a good job for the homes where they are fitted. Of course, cavity wall insulations need to be done with the right materials, by the right people, in the right places and according to the right standards. I regret to say that there are circumstances—rather more in the early days than now—where those criteria were not adhered to, and problems arose with properties in which cavity wall insulation had been placed.

Order. Could you face this way?

I am sorry, Mrs Latham. One would think that, in a reasonable world, there should be speedy recognition that the problem has arisen and an equally speedy arrangement whereby the person in whose home the problem has arisen can get restitution for what has happened, in terms of both compensation and putting right what has gone wrong with the cavity wall insulation.

The Cavity Insulation Guarantee Agency came into being in 1995. As hon. Members have mentioned, it provides guarantees for cavity wall insulation. There have been 6 million since it was set up, over a 25-year period. The agency has a good record of ensuring that redress is carried out speedily and properly, where problems have arisen.

Unfortunately, not everybody knows about the agency or has had their wall insulations guaranteed through CIGA. Indeed, they might have had cavity wall insulation installed before guarantees came into place. The picture today is quite good regarding guarantees, but that does not remotely address the problem before us this afternoon. As my hon. Friend the Member for Halifax said, this is essentially a scandal on a scandal. It is the problem of cavity wall insulation going wrong in a certain area. When it does go wrong, several cases often appear in certain areas because the installer—

Order. Could the Opposition spokesperson address the Chair?

Yes, I am sorry; I keep doing that. The appearance of a number of problems in a particular area might relate to a particular company carrying out faulty insulations or using the wrong material, whereas in other areas no such events will occur.

Scandal one is that a relatively high number of deficient cavity wall insulation arrangements came to light in a particular part of the country. Scandal two is that a parasitic law firm decided to make a good living by zealously pursuing people it thought might conceivably have a claim for failed cavity wall insulation, and tried to push those people down a path to restitution in a wholly cynical and unacceptable manner. I am pleased to hear from my hon. Friend the Member for Halifax that the Solicitors Regulation Authority is investigating that company, SSB Law, but that does not address the fact that other firms also pursued that practice. Ironically, SSB Law took over a number of claims from a company that had pursued this model and gone bust in the process. One might say, therefore, that it is a scandal, upon a scandal, upon a scandal.

The way this worked is set out in a letter from CIGA to my hon. Friend the Member for Halifax, which describes how the model operated.

“Claims lead generator often unqualified promises large payouts if homeowner signs up to pursue a claim for failed cavity wall insulation.

Details passed to a RICS surveyor who does not visit the property but prepares a claim schedule based on detail provided by the lead generator.

Claim is handed to a claims solicitor”.

SSB Law, as mentioned, was a claims solicitor that took on a number of these cases, including those of another company operating this model, Pure Legal, having apparently been offered the opportunity to do so by the Solicitors Regulation Authority itself.