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GDHIF pay delay hitting suppliers

Businesses fitting properties with eco-friendly upgrades under the Green Deal Home Improvement Fund (GDHIF) are apparently experiencing financial problems due to late payments. 

The Department for Energy and Climate Change (DECC) should pay GDHIF vouchers for work worth up to £7,600 within a ten-day period. 

However, the BBC has reported that contractors talking to the broadcaster's Radio 4 You & Yours programme are seeing delays of up to four weeks. 

According to DECC, payments are being delayed because the department needs to verify applications. 

Nevertheless, companies working on Green Deal projects are claiming they have had to lay off staff because of these problems. 

Paul Mann, managing director of Insulation Render Solutions in Sheffield, told the BBC he was forced to let go five renderers, a plumber and two scaffolders. 

"Suppliers won't give us new materials until they've been paid, so we're stuck - the knock-on effect has been massive and we've had no clarity from DECC," he stated. 

The government has already come under fire after the GDHIF scheme was abruptly closed overnight in July. DECC had put aside £120 million for the initiative, which allowed people to apply for up to £7,600 for energy efficient modifications. 

However, it announced it would be cutting this maximum allowance after the first £50 million of the budget was taken. This sparked a rush on the scheme, with the remaining £70 million worth of applications being snapped up in just a few days, causing the government to close the scheme. 

The energy efficiency industry is now worried some of this money may go unspent if householders fail to redeem their vouchers. 

Jonathan Reynolds, shadow minister for energy and climate change, appears to share these concerns, claiming more investigation into applications is required. 

"To receive that many applications so quickly, there must have been a speculative element to it, with some people applying who may not be able to get the work done," he told the BBC. 

Posted by Paul Taylor