‘Hasty politics’ forces insulation firm to axe 670 jobs
One of the UK's largest insulation installers, Mark Group, has confirmed that it is to cut up to a quarter of its UK staff, prompting calls for political parties to put their differences aside and focus on stabilising the energy industry.
Up to 670 Mark Group staff potentially face redundancy, with the firm putting it down to a significant drop in demand for energy efficiency caused by the Government’s controversial decision to water down the Energy Companies Obligation (ECO) scheme.
Mark Group’s chief executive Bill Rumble said: “We had geared our workforce up to meet the expected demand for insulation and other energy efficiency installation work as a result of the ECO scheme, but changes to its structure have had knock-on effects that we can no longer avoid.
“Our core UK business remains robust and the need for effective energy efficiency solutions is as significant as ever. However, we recognise that we will need to operate with a smaller workforce until there is a clear and consistent approach to energy efficiency policy.”
The ECO scheme, which requires energy utility firms to fund energy efficiency installations for fuel-poor households, was attenuated last year after Prime Minister David Cameron indicated that green levies could be ‘rolled back’ following the public debate on the cost they add to household energy bills.
Construction firms installing energy efficiency measures through the ECO scheme and manufacturers which make products such as solid wall insulation feared that over 10,000 jobs could be lost if ECO is scrapped or scaled back.
Official statistics released last month showed the work under the ECO scheme had sunk to its lowest level in over a year, with the number of ECO measures installed falling for the third month in a row to 30,550 across the UK.
Dave Sowden, chief executive of the Sustainable Energy Association (SEA), believes these jobs at Mark Group have been put at risk as a direct result of short-term changes in Government policy, driven by ‘hasty politics’.
“This is a very sad day indeed,” said Sowden. “As we head towards the election, it is crucial that energy efficiency is no longer used as a political football, and that party politics are removed from the equation.
“Instead, it’s vital to establish a stable, long-term policy framework for energy efficiency – one that delivers the cleanest and most cost effective way to meet all of our energy objectives. As part of our 2015 Manifesto, we appeal to all political parties to support our ambitious programme for change. This will provide policy stability so confidence can be rebuilt in the sector leading to a more affordable and secure energy future for the UK.”
A spokesperson for the Department of Energy and Climate Change (DECC) countered Sowden’s view, arguing that the Government’s ECO and accompanying Green Deal energy efficiency financing scheme were set to support around 35,000 jobs in the insulation industry in 2015/16.
“The Government announced a £540m, three-year energy efficiency package to make Britain’s homes and public buildings more energy efficient,” said the spokesperson. “With the Green Deal Home Improvement Fund, we’ve created a pipeline of up to £120m worth of work to be carried out by the industry in the coming months. Since January 2013 around 700,000 homes have benefitted from ECO and a further 600,000 homes will be warmer as result of scheme being extended to 2017.”
The Government closed its Green Deal Home Improvement Fund – which incentivises people to undertake energy efficiency work in their homes – in July, just six weeks after opening, as nearly all of the £120m funding pot had been allocated.