‘Retrofit salary sacrifice scheme’: a funding approach to improve privately-owned housing stock

Panel: 2. Policy innovations to ensure, scale and sustain action

Authors:
Marina Topouzi, ECI-CREDS, University of Oxford - Environmental Change Institute, United Kingdom
Mallaburn Peter, University College London, United Kingdom

Abstract

During the pandemic Governments around the globe have introduced measures that limit the use of offices and public spaces. Working from home has become – and to some extend will continue to be – the new normal for employees and employers. Views from real estate investments and national statistic trends show a longer-term shift from co-working space platforms to home offices. The downsize of office space puts home environment into a different perspective.

Houses often are not prepared either to provide adequate space for multiple functions or indoor environmental qualities (IEQ) related to users’ health and wellbeing. The lack of adaptable layout, insufficient lighting, air quality and heating together with damp conditions and inefficient services have an impact to utility costs in disfavour to the employee/occupant. The low-carbon retrofit rate in private-owned domestic sector requires additional incentives to deliver fast and at scale.

This paper discusses a policy idea that will complement current schemes and enforce retrofit decision making by adopting a ‘Retrofit salary sacrifice scheme’ arrangement between the employers and employees to support improvement measures in private-owned houses.

Tax-energy efficient benefit approaches and successful cases studies in the UK and EU from other sectors (e.g. transport, childcare) are reviewed, and policy transfer opportunities and their implications for companies (employers), private home-owners (employees) and green recovery of the construction sector are explored.

The paper concludes with suggestions on how a non-cash arrangement between companies and homeowners initiated by COVID19 restrictions can be an opportunity for EU and national policy for subsidise a trade-off between non-domestic and domestic buildings to: enforce assessment of the building condition, the planning and adoption of low-carbon measures improving homeworking conditions, and increase demand of current renovation schemes boosting supply chain.

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