Department for Levelling Up, Housing and Communities head Michael Gove is expected to announce that the cost for the remediation of unsafe cladding on buildings between 11m and 18m will fall on the developers who built them.
The story was broken by the BBC and Times over the weekend and suggests that Mr Gove will address the House of Commons in a speech which will put building firms “on-notice” of his intentions.
“Those who knowingly put lives at risk should be held to account for their crimes. And those who are seeking to profit from the crisis by making it worse should be stopped from doing so.
“I am putting them on notice. If you missold dangerous products like cladding or insulation, if you cut corners to save cash as you developed or refurbished homes, we are coming for you.”
It is anticipated further detail will be announced about the way in which the remediation is to be funded, thought to be around £4bn, with indications that it could be collected through taxation or other legal means. The Sunday Times suggested Mr Gove has enlisted the support of a team of forensic accountants to “unpick corporate webs woven to evade responsibilities.”
In an indication of his intentions, Mr Gove appeared before the Housing, Communities and Local Government Committee in November 2021 saying that he was “unhappy with the principle of leaseholders having to pay at all, no matter how effective a scheme might be in capping their costs or not hitting them too hard at any one time. My question is why do they have to pay at all?”
At the time he paused the loans scheme which made funding available to leaseholders for properties below 18m and in December announced he would introduce measures to tackle the crisis in the New Year.
It is anticipated that Mr Gove will also withdraw advice that lenders will require an EWS1 safety certificate for sales and remortgages, following the announcement from RICS pre-Christmas that it would not be removing its requirement for EWS1 certificates while the existing guidance was in place.
In a draft copy of his speech Mr Gove will say “no leaseholder living in a building above 11 metres will ever face any costs for fixing dangerous cladding.”
Other measures introduced recently on top of funding already provided for cladding remediation include
- The Residential Property Developer’s Tax; a tax on the profits of major housebuilders to be used to tackle cladding remediation
- Increase in the window of opportunity for leaseholders to sue builders over defective flats. Initially increased from 6 years to 15, now further increased to 30 as part of changes to the Building Safety Bill.
One Response
Was not Thatcher’s scheme to make EFM housing mortgage-able after sale under the RTB more generous and convenient for owner occupiers?