Government forces developers to fix cladding crisis

January 18, 2022

Secretary of State for Levelling Up, Housing and Communities Michael Gove has warned developers that they must pay to fix the cladding crisis that they caused as he overhauls the government’s approach to building safety.

Mr Gove wrote to developers last week, giving them a deadline of early March to agree a fully funded plan of action including remediating unsafe cladding on 11-18 metre buildings, currently estimated to be £4 billion.

He warns he will take all steps necessary to make this happen, including restricting access to government funding and future procurements, the use of planning powers and the pursuit of companies through the courts. He adds that if industry fails to take responsibility, the government will if necessary impose a solution in law.

In the letter, the Secretary of State asks companies to agree to:

• make financial contributions to a dedicated fund to cover the full outstanding cost to remediate unsafe cladding on 11-18 metre buildings, currently estimated to be £4 billion

• fund and undertake all necessary remediation of buildings over 11 metres that they have played a role in developing

• provide comprehensive information on all buildings over 11 meters which have historic safety defects and which they have played a part in constructing in the last 30 years

The vast majority of 11-18 metre buildings are safe and others that do have combustible cladding may also be safe or can be made safe through effective use of existing or new fire safety measures, such as sprinklers and alarms. There are, however, a small number of residential buildings with unsafe cladding which must be addressed.

Mr. Gove says developers must take forward all necessary remediation work at pace – prioritising those with greatest risks first and in all cases finding the quickest and most proportionate solution to make buildings safe.

He calls on industry to enter an open and transparent dialogue with the government to hear their proposals, starting with a roundtable with the largest residential developers and trade bodies. The government will invite leaseholders and those affected by the Grenfell Tower tragedy to the table to discuss solutions at appropriate junctures to ensure discussions are not taking place behind closed doors.

The government will announce a decision on which companies are in scope for funding contributions following discussions with industry but expect it to cover all firms with annual profits from housebuilding at or above £10 million.

Following Mr. Gove’s letter to industry, the old proposed loan scheme for leaseholders in medium-rise flats will be scrapped, with industry given two months to agree to a financial contributions scheme to fund the new plan, otherwise, if necessary, the government will impose a solution in law.

In addition, a new dedicated team is being established to pursue and expose companies at fault and to force them to shoulder the burden of making buildings safe.

Mr. Gove revealed a 4-point plan to reset the government’s approach:

• Opening up the next phase of the Building Safety Fund to drive forward taking dangerous cladding off high-rise buildings, prioritising the government’s £5.1 billion funding on the highest risk

• Those at fault will be held properly to account: a new team is being established to pursue and expose companies at fault, making them fix the buildings they built and face commercial consequences if they refuse

• Restoring common sense to building assessments: indemnifying building assessors from being sued; and withdrawing the old, misinterpreted government advice that prompted too many buildings being declared as unsafe; and

• New protections for leaseholders living in their own flats: with no bills for fixing unsafe cladding and new statutory protections for leaseholders within the Building Safety Bill.

 

This is valid as of 18th January 2022.

 

Secretary of State for Levelling Up, Housing and Communities Michael Gove has warned developers that they must pay to fix the cladding crisis that they caused as he overhauls the government’s approach to building safety.
Mr Gove wrote to developers last week, giving them a deadline of early March to agree a fully funded plan of action including remediating unsafe cladding on 11-18 metre buildings, currently estimated to be £4 billion. He warns he will take all steps necessary to make this happen, including restricting access to government funding and future procurements, the use of planning powers and the pursuit of companies through the courts. He adds that if industry fails to take responsibility, the government will if necessary impose a solution in law. In the letter, the Secretary of State asks companies to agree to: • make financial contributions to a dedicated fund to cover the full outstanding cost to remediate unsafe cladding on 11-18 metre buildings, currently estimated to be £4 billion • fund and undertake all necessary remediation of buildings over 11 metres that they have played a role in developing • provide comprehensive information on all buildings over 11 meters which have historic safety defects and which they have played a part in constructing in the last 30 years The vast majority of 11-18 metre buildings are safe and others that do have combustible cladding may also be safe or can be made safe through effective use of existing or new fire safety measures, such as sprinklers and alarms. There are, however, a small number of residential buildings with unsafe cladding which must be addressed. Mr. Gove says developers must take forward all necessary remediation work at pace - prioritising those with greatest risks first and in all cases finding the quickest and most proportionate solution to make buildings safe. He calls on industry to enter an open and transparent dialogue with the government to hear their proposals, starting with a roundtable with the largest residential developers and trade bodies. The government will invite leaseholders and those affected by the Grenfell Tower tragedy to the table to discuss solutions at appropriate junctures to ensure discussions are not taking place behind closed doors. The government will announce a decision on which companies are in scope for funding contributions following discussions with industry but expect it to cover all firms with annual profits from housebuilding at or above £10 million. Following Mr. Gove’s letter to industry, the old proposed loan scheme for leaseholders in medium-rise flats will be scrapped, with industry given two months to agree to a financial contributions scheme to fund the new plan, otherwise, if necessary, the government will impose a solution in law. In addition, a new dedicated team is being established to pursue and expose companies at fault and to force them to shoulder the burden of making buildings safe. Mr. Gove revealed a 4-point plan to reset the government’s approach: • Opening up the next phase of the Building Safety Fund to drive forward taking dangerous cladding off high-rise buildings, prioritising the government’s £5.1 billion funding on the highest risk • Those at fault will be held properly to account: a new team is being established to pursue and expose companies at fault, making them fix the buildings they built and face commercial consequences if they refuse • Restoring common sense to building assessments: indemnifying building assessors from being sued; and withdrawing the old, misinterpreted government advice that prompted too many buildings being declared as unsafe; and • New protections for leaseholders living in their own flats: with no bills for fixing unsafe cladding and new statutory protections for leaseholders within the Building Safety Bill.   This is valid as of 18th January 2022.  

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