Paul Rivett, Managing Director Heatrae Sadia, is BMBI’s Expert for Water Heating.

The uncertainty leading up to the Brexit referendum has continued, stifling investment in current and new projects. Many businesses, including merchants and distributors, have lowering stock holding to reduce working capital.

Theresa May’s recent departmental changes have brought energy, commerce and industry back together after an 8 year separation. We think the reuniting of these areas makes perfect sense. It’s an opportunity for the Government to introduce a more joined up approach to policy, and cut out the administrative red tape which naturally occurs when responsibility is spread over multiple departments.

One such area is compliance and the enforcement of product performance and safety standards. Under the previous Government, energy related regulation could be decided by the Department of Energy and Climate Change, set by the Department of Communities and Local Government and enforced by a contracted out under-resourced National Measurement and Regulation Office which sat within the Department of Business Innovation and Skills. It’s not surprising that the enforcement of Building Regulations and Energy Efficiency Regulation in the UK has been somewhat lacking in recent years.

Unfortunately this shortfall in enforcement has led to a worrying decline in compliance across some parts of the heating and hot water sector. This includes products placed on the UK market that haven’t got third party approval, which ensures they’ve undergone all the necessary Safety and Performance requirements for UK installation. Or, products being placed on the market which claim higher efficiencies than they have in reality achieved.

Who cares, some may ask? However a disregard for the enforcement of standards undermines their credibility, reduces the
competitiveness of those companies that do invest in compliance, and ultimately results in consumers being placed at risk of receiving products which the UK Government has deemed unfit for purpose. The new Department of Business, Energy and Industrial Strategy brings back together those who set the regulations and those who enforce them. With this reunion comes a fresh opportunity to ensure that the standards set by the Government are realised in the marketplace.

Looking forward, I believe the market will be subdued next year, either flat or up to 2-3% down on 2016.