Rachel Reeves has faced warnings from energy firms, fuel poverty charities, and environmental groups regarding potential cuts to funding for home insulation in the upcoming budget. Over 60 organizations and companies, including Age UK and Friends of the Earth, expressed concerns in a letter to the Chancellor, urging against what they termed a “short-term fix” that would hinder efforts toward energy-efficient homes while adversely affecting low-income households.
The potential budget adjustments include a multibillion-pound energy support package that could reduce green levies dedicated to funding energy efficiency improvements, potentially leaving the average household bill lower by approximately £170. Among the specific areas under review is the energy company obligation (ECO), which financially assists in enhancing energy efficiency for vulnerable households.
The letter highlights that cuts to the ECO could jeopardize the UK’s targets for fuel poverty and carbon emissions, potentially risking thousands of jobs in the energy efficiency sector. The signatories reaffirmed their support for measures aimed at lowering energy bills but stressed that such initiatives should not undermine investment in energy efficiency, as this approach offers sustainable solutions to high energy costs.
The context of these discussions follows remarks from Keir Starmer at the Cop30 climate conference, where he emphasized the UK’s commitment to addressing climate issues and fostering green employment. Additionally, key stakeholders have warned that previous reductions in ECO funding led to job losses and increased energy bills for families.
Government officials, including Darren Jones, the chief secretary to the prime minister, have indicated their ongoing commitment to green initiatives amidst calls for fiscal reform. Meanwhile, a Treasury spokesman remarked that details regarding future tax policy changes would be clarified during the upcoming budget announcement. Further tax adjustments are also anticipated concerning pension contributions, which may affect employees’ national insurance obligations.
Source: https://www.theguardian.com/environment/2025/nov/08/cutting-home-insulation-funding-imperil-uk-climate-goals-reeves-told