SOCIAL HOUSING DECARBONISATION FUND

Rating: Compared to financial year 24/25, the NISTA/SRO Delivery Confidence Assessment (DCA) rating at 25/26 remains at Amber. This reflects sustained delivery progress across the programme, effective management of previously identified risks, and increased confidence in the programme’s ability to deliver its objectives within agreed parameters. In particular, the programme successfully launched a new scheme (Wave 3) and is forecasting to have delivered nearly all of its capital budget for 25/26. The overall programme reached a notable milestone, with the 100,000th energy efficiency measure installed during 25/26, demonstrating the scale and impact of the scheme to date. Wave 2 concluded delivery on the majority of projects, with residual activity focused on formal closure, reconciliation, and assurance processes agreed for the first quarter of 26/27. The Wave 2 project is on track to meet FBC targets. Wave 3 entered active delivery with all Grant Funding Agreements in place and projects progressing through delivery phases as planned. Delivery momentum strengthened during the year, evidenced by increased grant drawdowns and phase requests, demonstrating that projects are mobilised and delivering at scale. As at end of March, the delivery team are confident that close to the capital budget was successfully spent by grant recipients. Programme governance and controls continued to mature over the reporting period, with progress made in addressing assurance recommendations, improving data quality and reporting, and embedding lessons learned from earlier waves. The programme received a joint Amber at Gateway 3 assurance in Q4. Overall, the Green DCA rating for 25/26 reflects the demonstrable delivery progress on both outcomes and financial outturn. Sustaining this delivery confidence will only be possible if the programme receives strong support for resourcing needs, with proactive support as part of wider departmental transformation taking place in Q1/Q2.

Schedule: Compared to financial year 24/25-Q4, the project's end-date at 25/26-Q4 remained the same.

Cost: Baseline WLC remain unchanged as per the latest agreed business case.

Source: NISTA Major Projects Annual Report 2025-26 (data)

Rating: Compared to financial year 23/24-Q4, the Infrastructure Project Authority's Delivery Confidence Assessment rating at 24/25-Q4 remained at AMBER. This is primarily due to the following factors‚ Good progress has continued across the SHDF programme with SHDF Wave 2 in delivery and WH:SHF Wave 3 funding allocations announced in March 2025 for delivery through to 2028. Delivery confidence remains amber due to the programme’s high complexity and its dependency on a number of external factors.

Schedule: Compared to financial year 23/24-Q4, the project's end-date at 24/25-Q4 remained at 31/03/2030. This is primarily due to the following factors‚ The last programme business case from 2022 assumed delivery through to 2030. Data in this return has been amended to include business case information only to the end of Wave 3 delivery in 2028, as funded from the first phase of the 2025 spending review in Autumn 2024. Delivery beyond 2028 is subject to further spending review decisions.

Cost: Compared to financial year 23/24-Q4, the project's departmentally agreed Whole Life Cost at 24/25-Q4 (measured in £m) decreased from 4558 to 2226. This is primarily due to the following factors‚ The last programme business case from 2022 assumed delivery through to 2030. Data in this return has been amended to include business case information only to the end of Wave 3 delivery in 2028, as funded from the first phase of the 2025 spending review in Autumn 2024. Delivery beyond 2028 is subject to further spending review decisions.

Source: NISTA Annual Report 2024-25 (data)

Rating: Compared to financial year 22/23-Q4, the Infrastructure Project Authority's Delivery Confidence Assessment rating at 23/24-Q4 remained at Amber. This is primarily due to the following factors. The SHDF Programme is progressing well with projects at different points of the project life cycle. As at end of March 2024, SHDF Wave 1 is on course to conclude all closure activity during Q1 of 24/25, and is anticipated to achieve all of its benefits, including carbon reduction and treating a significant number of homes, thus contributing to the goal of reducing fuel poverty. The final evaluation of Wave 1's impact is due in Autumn 2025. Wave 2.1 has seen an increase in measures installed in households, however there is still work to do to ensure delivery reaches the necessary trajectory in year 2 of delivery to achieve scheme benefits. Successful applicants to SHDF Wave 2.2 were announced in March 2024, with grant funding payments due to commence in Q1 of 24/25. A GIAA Audit of the Programme's Lessons Learned approach took place in Q4 and returned a good or 'substantive' marking, demonstrating the success of the programme to date in learning and implementing lessons. SHDF Wave 3 is anticipated to progress to final approvals to commence delivery in 24/25, and received an Amber rating in March 2024 from an IPA Gateway 2 review.

Schedule: Compared to financial year 22/23-Q4, the project's end-date at 23/24-Q4 remained schedule to finish on 2030-03-31. This is primarily due to the following factors. Significant progress on the SHDF Programme included commencing project closure for Wave 1, delivery of Wave 2.1 and successful applicants into Wave 2.2. SHDF Is reasonably placed to deliver despite resourcing challenges. Wave 1 formally closed on 31 December 2023, with grant recipients closing projects through Jan-March 2024. By January 2024, there were c.27,000 measures installed in c.14,100 households under Wave 1. Wave 2.1, are working with finance and HMT to ensure accuracy on grant spend accounts. c.4,500 measures installed in c.2,500 households by January 2024. Following closure of the Wave 2.2 competition, 42 successful projects were announced, totalling 75.5m in grant funding. Wave 3 funding for 2025-28 was announced on 18 December 2023. Salix manage the Delivery Partner to enable delivery across Wave 2 and procurement of a delivery partner to support Wave 3. The Technical Assistance Facility contract was awarded to Turner and Townsend, signed in February 2024.

Cost: Compared to financial year 22/23-Q4, the project's departmental-agree Whole Life Cost at 23/24-Q4 decreased from 4721m. to 4558m. This is primarily due to the following factors. Whole Life Costs for SHDF have been updated to account for the addition of SHDF Wave 2.2 (4558.82)

Source: IPA Annual Report 2023-24 (data)