Policy volte-face to come under the High Court spotlight
This summer I shall be in the High Court. My Association is judicially reviewing a decision taken by Communities Secretary Eric Pickles. Such an action is appropriate if a minister is perceived as having acted irrationally, disregarding facts before them in a consultation that they themselves have initiated.
In January 2012 Mr Pickles launched a public consultation, which proposed that, when households erect extensions or convert garages, around ten per cent further of that cost should be spent on improving the energy efficiency of the original building.
Attached to the public consultation was the government’s official Impact Assessment, which examined the likely consequences of enacting these proposals. It identified well over £11bn in economic benefits to the economy. Plus the accrual of over 130m tonnes of lifetime carbon dioxide savings. Plus, in CLG’s estimate, some 2.2m Green Deals.
Working group conclusions
In 2011 I was appointed by the Communities Department to chair its working group 4, entitled “Retrofit and the Green Deal”, to advise on the proposed changes to Part L (conservation of fuel and power) of the Building Regulations. I presented the conclusions of that working group to a meeting of the standing Building Regulations Advisory Group, attended by the relevant Departmental officials on 11th July 2011. Many of the recommendations made by my working group were incorporated into the relevant parts of the consultation document issued by Mr Pickles.
Writing an article launching this consultation, Mr. Pickles’ then- colleague, the Buildings Minister, Andrew Stunell, said: “There are also moves to cut carbon in existing homes and boost the Green Deal. We’re doing this through the introduction of “consequential improvements”, something Labour bottled out of introducing twice. Where homeowners or businesses are carrying out works to their building (an extension, a loft conversion) they would be asked to undertake additional work to improve the energy efficiency of the building at the same time.
“They will only be obliged to do so if they are eligible for the Green Deal, to ensure that they are not forced to bear the upfront cost, which would be paid for by the savings in their energy bills. This regulatory nudge, coming into force in October 2012, will help boost demand for the Green Deal, whilst also cutting carbon emissions and delivering cheaper energy bills for households.”
Speaking at a conference that month at the BRE in Watford, Stunell acknowledged that the consequential improvements approach has featured on UK government policy agendas for existing homes before without being brought forward. He said: ‘It’s the grand old Duke of York of building regulations policy… but this time we’re going to do it.’
The consequential improvements approach is outlined in CLG’s consultation document on changes to Part L of the building regulations, and is considered to be integral to the Green Deal, as the new incentive will help fund the measures. Stunell explained: ‘There is a certain amount of consumer inertia to [improving energy efficiency] and that’s where consequential improvements provide an additional driver to success.’ ”
But on December 13 2012, Mr Pickles completely reversed his declared policy. Instead, he announced in Parliament that nothing at all would proceed. “Having considered all the representations and evidence, including the public reaction, I can inform the House that we will not be going ahead with such regulatory proposals in any way.”
I was very surprised that no reference to this widespread endorsement of his initial policy appeared in Mr Pickles’ statement. Instead, Mr Pickles cited just two research reports in order to justify his volte–face. On closer inspection, neither endorses the conclusions he officially draws from them. It is the wilful misinterpretation of these which forms the nub of our legal case.
His first justification was that some “exploratory research” from the Energy Saving Trust (EST) had established that such requirements would deter 38 per cent of householders from making any improvements. Within minutes of that statement the Trust had responded indignantly and publicly, stating that their figures had been wrongly quoted – errors that the Department unreservedly acknowledged in Parliament, albeit only once the judicial review process was underway.
The other study cited in justification was a review of focus groups run specifically for Mr Pickles by AECOM. According to his statement, the focus groups found that “it could increase dishonesty in the market. It would potentially present rogue traders with an opportunity either to not inform homeowners of the requirements (to keep costs down), or to inflate the requirements and ‘rip people off’.
While these were indeed isolated comments made by individual participants, the overall conclusions reached by AECOM were very different in tone and content.
Personally I want to begin to see each of the benefits realised which Mr Pickles stated last year would accrue from implementing his original “consequential improvements” strategy. These were the positive arguments which led to the consultation paper emerging, endorsed – as it had to be before being issued- by every other member of the Cabinet. And these are the benefits that the High Court should help us ensure are realised.
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