Home Energy Scotland (HES) Grant and Loan Scheme: EIR release

Information requested

1. Can you please confirm the number of instances where a signed grant & loan funding agreement through Home Energy Scotland has been reneged following completion of works?

2.  Can you advise the process for debt recovery for those who have fallen on financial hardship and can no longer repay the loan?

3. Of the grant & loan scheme, how many cases have been passed to debt recovery?

4. Are debts fully recoverable?

5. How many have been fully recovered?

6 - How many have been waived?

Response

The information relating to total number of loans in default spans the period from December 2022 which is when the Home Energy Scotland (HES) Grant and Loan Scheme began, up to the end of December 2023. Loans that have only been part paid have been excluded as you have requested information on loans where work has been completed.

The HES Grant and Loan Scheme is administered and managed on behalf of the Scottish Government by the Energy Saving Trust (EST). EST are Financial Conduct Authority (FCA) accredited in relation to Consumer Credit regulated activity including:

• Entering into regulated credit agreements as Lender.
• Debt administration.
• Debt-collecting.

1. There were a total number of 40 loans issued under the HES Grant and Loan Scheme recorded as having at least one missed repayment since the introduction of the scheme in December 2022. Of these, 36 are recorded as having missed one repayment only.

2. Up to three letters are issued as part of the debt recovery process:

• 1. A failed payment notice is issued by EST on the first occasion a repayment is missed.
• 2. A repeated failed payment notice is issued where a second and third payment is missed

Annual statements continue to be issued to all customers who have an outstanding loan balance but this is separate to the debt recovery process. A repayment holiday or an extension to the loan term may be considered where a customer is in financial difficulty.

3. Loans are classed by EST as ‘impaired’ after three months. A total of three loans under the HES Grant and Loan Scheme are classed as ‘Impaired’. All three continue to be administered by EST and none at the present time have been passed to a debt recovery agency.

4. Loans issued under the HES Grant and Loan Scheme by EST are FCA regulated credit agreements. As unsecured personal loans, they are low in the hierarchy of debt and not always fully recoverable.

5. Of the 40 loans issued under the HES Grant and Loan Scheme which have at least one missing payment recorded since the schemes introduction in December 2022, four have arranged for their missed payment to be added to the end of their loan term.

6. No one who has received a loan under the HES Grant and Loan Scheme and who has missed one or more payments has had their arrears or full loan debt waived.

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