Examination of Witnesses (Questions 120-139)
MS SARAH
WEBB AND
MR RICHARD
BAINES
19 NOVEMBER 2007
Q120 Mr Olner: Wait a minute! I have
got a motorcar and I have to have an MOT after three years, so
if you are going to talk about an MOT for housing stock, what
are we talking about in years—five years, ten years—or
is it when the house comes up for sale?
Mr Baines: I do not have an answer
for that yet. That would need debating.
Q121 Chair: Mr Baines, without having
a settled view, what are the kinds of issues that should be taken
into account in deciding how often it should be, or at what point?
Mr Baines: Firstly, you need to
decide whether it is about sustainability, about environmental
impact or just about energy. When you have decided on that, then
you can have an idea of what you are measuring. Let us just stick
with energy, which is to do with climate change and say if it
is only energy, every year we know what the fuel bill is, so you
could use the fuel bill as the trigger for saying: "We know
how big the house is; we have the council tax banding; we know
how much that sort of house should use in the range, in terms
of people." Therefore, we have a view, by reviewing the fuel
bill on a running basis, as to whether the building was efficient
or not.
Q122 Mr Olner: That is very rough
and ready, is it not? Mrs Olner tells us she washes six white
shirts too many per week, but if we had had eight to ten children,
then our energy needs would be much greater. There is nothing
on my council tax bill and nothing on the energy bill that says
where the energy is going.
Ms Webb: You have to separate
out: both are important but you have to separate out the use that
you make of the house and the appliances within the house (which
we have commented should be part of this inquiry but is not, as
we understand your terms of reference) and the energy that you
are using in your house every time you put the central heating
on, and whether there is one of you in the house or ten of you
in the house.
Q123 Mr Olner: To get back to the
original question, how often should the MOT certificate be sought,
or is it only sought when the property is exchanged?
Ms Webb: The absolute simplest
thing to do is to do it at the point of sale because we have to
be pragmatic about the extent to which we can make these changes.
However, we also have to recognise that if you only do it at the
point of sale it will take us a very long time to reduce the carbon
emissions of our existing housing stock. There is no right answer;
it is a trade-off between the practicality of doing it and the
cost to individual owners versus the overall impact on climate
change.
Q124 Chair: Can I disentangle this
a bit? The sustainable homes code is not just about energy efficiency.
Mr Baines suggests that presumably your energy utility would send
you a little reminder at the end of every year and say, "Your
bill looks very large for a property of its size; would you like
to look seriously at whether you have done this, this and this?"
That does not really relate to the code, does it?
Ms Webb: The code is to do with
the standard of the physical house, the level of CO2 emissions
that come from the house, irrespective of the appliances that
are inside the house.
Q125 Chair: Are you suggesting an
MOT, possibly via a fuel bill, would be one mechanism and then
a mandatory sustainable code when the house was sold, which I
am reminded would be roughly once every seven years?
Ms Webb: Yes, that approach would
certainly work.
Q126 Mr Olner: Before we completely
leave this issue, I am a very firm supporter of smart metering
and I think the Government ought to go further and make them mandatory
in new properties. Do you have any views at all that we should
and you should be putting to Government about retro-fitting smart
meters, because that will give the consumer a lot of the answers
they require whilst actually using energy?
Mr Baines: Absolutely. I was talking
only last week to a manufacturer of a new metering system which
can be retro-fitted to the house, and they are actually targeting
wealthier households with this as a vehicle to communicate with
them about how they are using their energy, so that they can start
to see where the energy is going and therefore what they can do
about reducing it. This kind of metering is essential, but whether
you sell it as a fringe benefit or whether you make it a mandatory
requirement and place the onus on the energy provider to retro-fit
these meters is to be debated. However, I think both mechanisms
could be applied. For example, social landlords could be in harness
with the utilities to retro-fit, and the private sector could
be motivated through the benefits of reducing their fuel bills
by buying their own monitoring equipment. The two could go together.
Ms Webb: It is quite important
to recognise that although we are using a crude analogy of MOTs,
we do understand that there is a difference between somebody's
home and somebody's car, so if your car fails its MOT you take
it off the road—
Q127 Mr Olner: If your car fails
its MOT you cannot sell it.
Ms Webb: Yes, but we have to accept
the practicality of the number of houses in this country that
would fail that MOT as of today, and we simply cannot go kicking
people out of their houses because we would have other problems.
Q128 Mr Olner: That is a fairly good
inducement for them to get—
Ms Webb: Well, I live in a house
that would fail and I would prefer to—
Q129 Mr Olner: What are you doing
about it?
Ms Webb: Well, that is a very
good question, but I would prefer to have incentives and support
and help to do what I can to make it pass its MOT rather than
be put in a situation where I was not allowed to sell it, or I
was evicted from it. We are talking about the concept of getting
more people in this country to understand the emissions that come
from their existing housing, not in the business of throwing everybody
out of their housing because it fails.
Q130 Mr Betts: You say there should
be a sustainable homes code that identifies rough categories of
property and what their energy use ought to be in ideal circumstances.
Then they have the Energy Performance Certificate, which looks
at where they are now, but also, as I understand it, it is an
indication to householders as to what they should be doing to
improve their performance. Does that get us a bit further forward
from where we are now? In a way they are doing that, are they
not? They are saying where we are at and where you can get to
with some reasonable investment?
Mr Baines: The difference is that
with the MOT you can fail; with the EPT there is no failure; it
just says where you are. I think there needs to be some sort of
onus on improving property, not just voluntarily so that you can
sell the house.
Q131 Mr Olner: So there is going
to be a penalty.
Mr Baines: But actually to save
carbon—some compulsion. The question is how you do that
without evicting people from homes, which was Sarah's point. One
way you could look at this is the energy services approach. If
fuel suppliers were to say, "We are big buyers and can provide
a cost-effective solution to your energy losses, and make it more
energy-efficient—your fuel bill will not change over the
next 10 years but what we sell you is going to change; we are
going to sell you 75% fuel and 25% insulation over the next ten
years", the bill does not change but you use less fuel and
you will emit less carbon, and you will achieve your Code for
Sustainable Homes on existing homes.
Q132 Mr Betts: Presumably, it would
be the householder, the purchaser rather than—
Mr Baines: It could be the existing
householder. If there is compulsion for the existing householder
to improve the performance of their building, rather than saying,
"If you do not do it we will condemn your house and you cannot
live in it", we could say, "Here are mechanisms by which
we can help you to achieve what you have to do."
Q133 Mr Betts: You are asking someone
who has sold their house to put insulation in it.
Mr Baines: This is not about changing
tenure; this is about saying—
Q134 Mr Betts: If you are only going
to do this at the point where someone has put a house up for sale,
then in reality you cannot sell it until you have done it—or
"We are selling you a package of insulation and energy, as
opposed to just energy, for the next ten years", in which
case you are asking someone to pay for something that they probably
have already got rid of.
Mr Baines: I am trying to get
away from doing this at point of sale, to say that if you own
a house, like your car, if it is energy inefficient, you need
to do something about it.
Q135 Mr Betts: When will this assessment
be done, then? You have just told us it would be at point of sale.
Ms Webb: No, we thought that was
one way of doing it that would have—it would be the longest
way of doing it but in some respects it would be the easiest,
because you have a mechanism to go in. If you do not do that,
you need to create a point of mechanism to go in, and that is
harder to do. That is why you probably need to look at a programme
of bringing in existing housing. The MOT is a way of judging how
far you are towards pass or fail but the programme is a better
approach to—
Q136 Mr Betts: A programme linked
to what?
Ms Webb: Linked to the code for
existing housing.
Q137 Mr Betts: Paid for by whom?
Ms Webb: The issue of properties
is the big one in all of this, is it not?
Mr Baines: It would depend on
who owned the property as to who paid for it. If it is a registered
social landlord you would expect the registered social landlord
to pay for the improvements. If it is a private home-owner, then
you expect, where reasonable, that the owner and occupier would
improve the building. You could have a degree of compulsion, which
said: "This is the standard you have to achieve; this is
the code for existing housing; your house does not achieve that.
It is going to take these measures to make it achieve that and
they are going to cost this much. You can do nothing about it,
and at a certain point we are going to have to take some action
against you." The analogy with the car is that we can take
their car off the road but of course we are not saying that you
can do that with houses, but there has to be a point at which
you do something about it to compel people who will not do it
to do something about it. Most people will be reasonable and say,
"Hang on a minute; if I do this, my fuel bill falls in the
long run." If all houses are meeting the code at a point
in the future, fuel bills will be smaller. The way we have described
doing it was to say the fuel bill could have an element of fuel
and an element of energy efficiency, and that over a period of
time would enable the investment to be taken with no extra costs
to the householder. There would be grants for people who cannot
afford to pay as there are now with Warm Front and the Energy
Efficiency Commitment. There is a raft of mechanisms about us
to help people to implement this so that it is not draconian.
It will be hopefully revenue-neutral but we would get to the zero
carbon neutral level much sooner in the existing housing stock.
Q138 Mr Betts: Who pays for the MOT
itself—the householder?
Mr Baines: Yes, the householder.
It could be through the fuel bill or it could be a very small
addition within the fuel bill, part of the standing charge. These
need not be huge costs. If we can do it on the basis of how much
fuel is being used, that information is already held and it is
only a matter of interrogating the database. That is not a huge
cost. A lot of this information does come on the fuel bill already.
Q139 Martin Horwood: I want to come
back to something that Mr Olner said, shortly after he made the
jaw-dropping suggestion that wives should wash their husbands'
shirts for them, but I will not go into that! He asked you about
the issue of benchmarking these standards and you gave a slightly
glib answer, but it is actually rather crucial, is it not? Basically,
it affects the price at which you can sell your house. You could
have two identical houses with completely different families next
door to each other—there is a single man living next to
me and we have a very similar house but with four people in it,
with two small kids and we are often there during the day because
someone is working from home. Do you aim for a scheme that tries
to be very, very complex in its effort to be fair, or do you prefer
something that is just simple and a bit unfair?
Mr Baines: You have introduced
under-occupancy, which is quite a difficult subject.
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