The UK’s biggest businesses are warning Andy Burnham that slashing funding for heat pumps “in the middle of a gas crisis” threatens even higher energy bills for households.
Firms including Ikea, EDF and Mitsubishi and charities such as Age UK are urging the Government to drop an announcement expected in the Budget that hundreds of millions will be cut from public subsidies for heat pumps.
At the moment, people wanting to replace their boiler with a heat pump can apply for grants from the Boiler Upgrade Scheme (BUS) – a key pillar of the Government’s £15bn Warm Homes Plan, which aims to lower households’ energy bills by kitting them out with green technology.
NHS Mounjaro roll-out plan deemed ‘unambitious’ by MPs
Current plans for rolling out weight-loss drug Mounjaro on the NHS “are unambitious” and reach a “woefully small number of people”, MPs have said.
What you need to know
6%
Only around 6 per cent of eligible people will get or currently receive Mounjaro on the NHS in its first three years, with millions more turning to private firms, according to the Commons Health and Social Care Committee.
MPs also used their report to call for obesity to be treated as a long-term condition like diabetes, and said people suffer relapses.
- They pointed to the “two-tier system” that has developed for access to drugs, adding: “The Government must urgently reassess the pace of roll out of Mounjaro.”
As a first step, the department should hold a summit on GLP-1 access with a range of providers and healthcare professionals to open a dialogue on how best to improve the roll out.
A closer look at the detail
- In June 2024, the National Institute for Health and Care Excellence (Nice) recommended Mounjaro as an option for managing overweight and obesity.
- The NHS has also approved semaglutide (Wegovy) for obese people, though many get their prescriptions privately due to a lack of access on the NHS.
- With Mounjaro, the NHS estimated 2.8 million patients would be eligible and, if all presented within the first year of availability, the cost would be £15.2bn over five years.
The gradual roll out of Mounjaro
As a result, Nice agreed to NHS England’s request that the roll out of Mounjaro should be done gradually, MPs said.
The NHS has been giving access to 220,000 people over three years, with the Health Foundation saying this makes up only around 6 per cent of those who would be eligible based on Nice’s recommendation.
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- In their report on obesity, MPs said a new framework is needed to “include ambitious targets for the proportion of a local population that should be able to access GLP-1s”.
- Data suggests more than 2.37 million packs of GLP-1s are being prescribed every month in the UK, “with the vast majority of these being accessed privately”, the study said.
to give NHS doctors ‘second pair of eyes’ on MRI scans
A number of AI programmes are set to be used by the NHS in England to help doctors spot prostate cancer on MRI scans.
The technologies would act like a “second pair of eyes” for medics, the National Institute for Health and Care Excellence (Nice) said.
What you need to know
The NHS spending watchdog has recommended five tools in new draft guidance, which will be used on the health service for two years while evidence is gathered on how they work.
The technologies are designed to help radiologists by highlighting areas on prostate scans where cancer may be present.
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Pressure on radiologists
- According to Nice, demand for prostate MRI has increased, as pre-biopsy scans are now included to confirm or rule out the disease.
- This has put pressure on radiology teams, which are already stretched because of workforce pressures.
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The expert view
These AI technologies have the potential to act like a second pair of eyes, helping radiologists review prostate MRI scans. They have the potential to make MRI reporting more accurate and could help identify people whose scans need priority review.
Dr Anastasia Chalkidou, programme director for HealthTech at Nice
All the options for lower energy bills that could be in the Budget
Energy bills remain a major concern for families across the UK. The PM has asked ministers “to look at whether we can remove standing charges from gas bills” and has already cut VAT from electricity bills. However, experts argue that’s not enough.
So, what measures could Chancellor John Healey announce at the Budget to make energy more affordable?
Abolish the standing charge
- Andy Burnham has asked the Chancellor and Energy Secretary Miatta Fahnbulleh to remove standing charges from energy bills.
- This would remove the component of households’ dual fuel bills which is charged regardless of how much energy is being used.
- According to energy research centre Nesta, the typical household would save £27 a year under this system.
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VAT removed from energy bills
VAT on household electricity was cut from 5 per cent to zero from 1 October, but only until the end of the 2026-27 financial year on 31 March.
It is saving the typical household £45 a year on their bills.
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Targeted support
- Some experts have called for the Government to deliver targeted support above the current Warm Home Discount which provides a one-off £150 rebate on energy bills for low-income or pensioner households.
- Energy UK said this could come in the form of an increased amount for those eligible or as a debt relief scheme for billpayers – not penalising those who fall behind on bills.
Expand support to people on benefits
Citizens Advice has called for expanded support for people in receipt of child benefit and personal independence payments (PIP).
This, the charity says, will protect households with children and disabled households who need help over the coldest months of the year, but currently fall outside the means-tested benefits criteria.
Under the BUS, eligible households in England and Wales can receive £7,500 towards an air-source or ground-source heat pump, rising to £9,000 for qualifying homes heated by oil or liquefied petroleum gas.
Chancellor under pressure to fund defence spending
However, sources from the clean tech sector have said they are expecting a cut “in the order of hundreds of millions” to the scheme in next week’s Budget to help cover increased defence costs.
The Chancellor is under immense pressure to fill a £4.7bn gap in the Defence Investment Plan left by Rachel Reeves, and to meet the commitment to spend at least 3 per cent of GDP on defence, amid new threats from Russia.
Equally, however, the Government wants to bring down the cost of living, particularly energy bills, which have increased since the Iran war.
Now, more than 100 businesses, industry bodies and charities have written to Burnham, as well as the Chancellor John Healey and Energy Secretary Miatta Fahnbulleh, warning them against raiding the Warm Homes Plan budget.
The list of signatories includes companies such as E.ON UK, Octopus Energy and Vaillant, charities such as Independent Age and WWF, the trade union Unison, and the New Economics Foundation think-tank, which until 2024 was led by Fahnbulleh.
A number of the businesses involved in the letter manufacture or install heat pumps and therefore have a financial stake in the BUS.
Calling for the Warm Homes Plan funding to be retained “in full”, the letter warns that “in the middle of a gas crisis, cutting any part of the plan that reduces Britain’s dependence on imported gas would work against the Government’s ambitions, and would be the wrong decision for homes, bills and for investment across the UK”.
The letter argues that cutting funding would leave households more exposed to volatile gas prices and see them missing out on long-term savings from switching to heat pumps.
Heat pumps are much more energy efficient and environmentally friendly than gas boilers, but their running costs and the potential savings on offer depend on the type of dwelling they are installed in, the standard of insulation, what tariffs are used and whether they are paired with other green technologies such as solar panels.
There are hopes that in the years ahead the expansion of renewable energy generation in Britain will help lower the price of electricity by decoupling it from the gas price, increasing the financial returns from moving to a heat pump.
Danger of cutting grants
The letter claims that an increase in energy prices over the last five years has already resulted in Britain paying “an extra £100bn for gas”, and that a previous decision by David Cameron to scale back energy efficiency improvements for homes ended up adding an estimated £22bn to households bills.
Camilla Born from Electrify Britain, the pro-electrification campaign group who co-ordinated the letter, said: “The Prime Minister has pledged to make people’s lives easier and [the BUS] is one obvious way to do that.
“Cutting it now would keep households locked into rocketing oil and gas prices and threaten thousands of jobs right across the country.”
In the letter, the companies also warn that cutting the Warm Homes Fund would deter investment in the UK by sending “the worst possible signal to the businesses building Britain’s electric heating and home upgrade supply chain”.
“Manufacturers, installers and suppliers waited 18 months after the election for a plan they could invest against,” it says. “They have invested, trained and planned on the strength of it”.
It adds: “Cutting the plan back within a year would tell every investor that Britain’s spending commitments are provisional, just as many of our competitors are sending the opposite signal.”
Some critics of public subsidies argue that they can end up inflating prices if retailers to decide to charge more. However, the letter says that heat pump installation costs have fallen 11 per cent in real terms since the BUS was launched.
The Department for Energy Security and Net Zero has been contacted for comment.