A “botched” scheme to insulate England’s draughty homes collapsed after six months because officials rushed its design, put in place an undeliverable timetable, and failed to heed industry warnings, Whitehall’s spending watchdog has found.

The National Audit Office (NAO) blamed the government for scuppering the opportunity to help households to improve the energy efficiency of their homes, reduce carbon emissions, and create tens of thousands of jobs by rushing the flagship scheme.

The GBP1.5bn green homes grant was considered a centrepiece of Boris Johnson’s pledge to “build back greener” and a pivotal part in the government’s bid to reduce carbon dioxide released by heating homes and buildings, which makes up about 19% of the UK’s total emissions.

Gareth Davies, head of the NAO, said the government’s focus on creating an “immediate economic stimulus” through the grants, in the midst of the Covid-19 pandemic, had meant that the programme had been rushed.

The government set a 12-week timescale to design the scheme, which it hoped would enable up to 600,000 households to save up to GBP600 on their energy bills by upgrading their energy efficiency, and support up to 82,500 jobs over six months.

It pressed ahead with the ambitious timetable “even though no bidder thought it was possible” to fully prepare the application system in time for the scheme’s launch, according to the NAO, leading to lengthy delays in processing grant applications and about 3,000 complaints between October 2020 to April 2021.

“As a result, its benefits for carbon reduction were significantly reduced and ultimately, it did not create the number of jobs government had hoped for,” Davies said.

If all current applications were processed the scheme would have undertaken less than 10% of the home upgrades planned. About 47,500 homes are expected to receive grants, at a cost to the taxpayer of about GBP314m. This includes GBP50.5m for managing and administering the programme, or a cost of more than GBP1,000 per upgrade.

The NAO has called on the government to set out how its various home energy efficiency plans fit together within its overarching plans for decarbonisation by the end of the year, including detailed timetables.

Meg Hillier MP, chair of parliament’s public accounts committee, said the green homes grant had been “set up to fail” due to the “undeliverable timetable and overly complex design which took little account of supplier and homeowners’ needs”.

Philip Dunne MP, chair of the environmental audit committee, said the NAO’s “sobering assessment of the failures of the scheme” shows that it was a policy “made on the hoof without proper consultation”.

Climate campaigners said the damning verdict on the scheme risked undermining the UK’s credibility ahead of the Cop26 climate talks in Glasgow in November.

Doug Parr, Greenpeace UK’s policy director, said: “The green homes grant failed to deliver because of cowboy politicians, not cowboy builders, or because energy efficiency improvements are a bad idea.”

He said the scheme’s “shoddy handling” has left “homeowners disappointed, businesses out of pocket, job promises unfulfilled and the UK no closer to decarbonising its housing. Parr called for Chancellor Rishi Sunak to commit GBP12bn in cash to help cut carbon emissions from our homes in the upcoming Spending Review.

A government spokesperson said: “As the NAO recognises, the green homes grant voucher scheme was designed as a short-term economic stimulus and was delivered during an ongoing pandemic.”

The spokesperson added that the government would spend GBP1.3bn this year to upgrade an additional 50,000 homes, while supporting hundreds of thousands of skilled green jobs.