Property developers will be forced to cover the cost of removing dangerous cladding from buildings taller than 11 metres, under new plans announced by the Levelling Up Secretary, Michael Gove.
In a letter to the residential property development industry on 10 January 2022, Mr Gove set out the government’s new approach to building safety aimed at protecting leaseholders by placing the financial burden of fixing the cladding crisis on developers.
Under rules introduced in England after the Grenfell Tower fire killed 72 people in 2017, only leaseholders living in buildings of more than 18 metres can access grants to replace unsafe cladding. The resulting ‘cladding crisis’ is seeing leaseholders facing vast remedial bills and unable to sell their homes.
Under Gove’s plans, the old proposed loan scheme for leaseholders in medium-rise flats would be scrapped and leaseholders living in their own flats will not face any costs to fix dangerous cladding, with developers and cladding companies paying instead. The remediation costs are currently estimated to total £4 billion.
A new Building Safety Bill is expected to introduce new statutory protections for leaseholders and allow the Government to introduce a levy on developers of high-rise buildings to help pay for building safety remediation.
New measures are also being planned to hold firms to account and restore common sense to the market, with a new dedicated team being established to pursue and expose companies at fault and to force them to shoulder the burden of making buildings safe.
Mr Gove has given the industry two months to agree to a plan of action to fund the remediation costs, or has warned the government will take action to impose a solution in law.
Housing campaigners and MPs have cautiously welcomed the plans as a step in the right direction, but warn they do not go far enough.
Approval for funding applies only to fixing cladding, and will not be available to leaseholders facing bills for defective fire compartmentation, fire doors and other non-cladding faults.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services - a Marketing Agency for the Professional Services Sector.
