HEATING and insulation specialist the Eaga Partnership has been named preferred bidder for a Government contract.

The Department for Environment, food and Rural Affairs yesterday announced the group was in line to operate the Warm Front programme, in the East of England.

This means that from June, Eaga will be running the scheme across every region of the UK.

The social enterprise company employs 300 people at its Newcastle base and another 450 nationwide.

James Grugeon, head of corporate affairs, said: "This is good news for us, but it is too early to say whether it will mean more jobs."

Warm Front is a grants scheme aimed at alleviating fuel poverty and nationally it will spend more than £250m during the next three years.

Last year, an estimated 1,000 elderly people in the region died from cold-related illness.

Mr Grugeon said contract negotiations were ongoing and he could not speculate on how much the deal would be worth to the group.

Eaga was set up in 1990, initially to administer insulation and heating schemes with Government grants.

It moved into commercial operations and has grown rapidly in recent years thanks to contracts with utility companies and local authorities on energy efficiency projects.