What is this coat?

Dear all,

We are currently stripping wallpaper in our single solid walled 1930 property. Can you please tell me what this orange layer under the wallpaper is? Is that primer?
Further,we are replacing it with a "insulation" layered wallpaper - should we apply PVA or should we leave it? I am a little worried that it may interfere with the wall "breathing".

Any help would be very much appreciated
View media item 87366 View media item 87367

Looks like it was painted with Tangerine colour Emulsion very popular in the 1960`s

Read the Instructions with the Insulation Wallpaper it normally recomends Wallpaper adhesive NOT PVA.

Ahhh,thank you! I should have perhaps mentioned that we will put on wallrock KV600 (insulation material) and they specifically mention to "size" the wall with PVA or flake adhesive (whatever that is).