Housing Minister, Robert Jenrick, has announced this afternoon that the government will provide extra funding towards the cost of removing unsafe cladding on buildings over 18m tall.
The new funding package is in addition to a £1.6bn building safety fund which was announced in 2020 and prompted by the deadly Grenfell fire three and a half years ago, which killed 72 people in Kensington, west London.
The government has faced mounting pressure and criticism surrounding the issue, in particular, the speed at which it has responded which experts estimate has left thousands of homeowners unable to sell their properties and others hit with bills exceeding £150k to fix cladding issues.
As you would expect, there was a quick reaction to the news.
Mark Hayward, Chief Policy Adviser, Propertymark, said: “Following the disaster of the 2017 Grenfell fire it is welcome news that the Government is finally increasing funding for residents stuck in buildings with unsafe cladding in England.
"We hope that extra funds announced today will make the process quick, efficient and cover the work needed to resolve any safety concerns residents face. Today’s announcement is just a start and the Government must now also commit to completely eradicating this type of cladding to ensure the safety of all properties and residents, not just in England but across the United Kingdom. Supporting and challenging our industry to deliver change is more vital now than ever, and it is encouraging to be one step closer to ensuring that people are safe within the confines of their own homes, as standard.”
Nicola Kravitz, partner at Memery Crystal, said: “The cladding scandal has caused severe hardship and stress to homeowners. We have had queries on this issue every day for the last 9 months and seen many transactions not proceed. It’s not just slowing down the property market, but it is causing real fear and worry in residents. People should feel safe at home, and we need real action to make sure residents across the country can feel truly ‘at home’, not in a state of worry.
“We welcome the news today that the government is pledging an extra £3.5 billion to remove unsafe cladding from high-rise buildings over 18 metres at no cost to homeowners, and that low-interest loans will be available for residents of buildings under 18m to cover the costs of recladding but await further details to see if these proposals go far enough and the proposed timescales to roll out these measures.”
However, the news was not greeted with warmth by everyone.
Shadow housing secretary, Thangam Debbonaire, was less impressed and slammed the announcement, saying: "Why should this arbitrary 18-metre height limit mean the difference between a safe home and financial ruin?"
Labour's MP for Barking, Margaret Hodge, said: "The announcement of loans for cladding remediation below 18m is an outrage. Leaseholders should not be hit with debt for fixing safety defects that they didn't create. Fire does not discriminate between height, neither should the Government. They are failing leaseholders."
Jonathan Frankel, head of the Property Litigation Dept at Cavendish Legal Group, said: “The £3.5bn announced today is completely insufficient to deal with even a fraction of the blocks up and down the country where these repairs must take place.
“But the fact that it only applies to buildings over 18 metres will cause even more uncertainty for those residents and leaseholders living in lower-rise blocks where they feel insecure and unsafe. It may be considered a lower risk, but it’s a risk nonetheless which will impact the saleability of their property.
“The leasehold protection scheme capping payment for repairs at £50 a month for leaseholders which has also been announced will bring little comfort to many who feel they shouldn’t have to pay for somebody else’s mistakes.”
At present, it is estimated that as many as 650,000 people in the UK are living in flats with potentially deadly cladding.
Housebuilder, Persimmon, makes £75 million cladding provision
Persimmon says it has made a provision of £75 million in its 2020 results to pay for its contribution to any necessary work on 26 buildings that may be affected by the cladding issue, in which materials were used which met regulations at the time but may now be considered unsafe and require removal.
The firm has identified 9 high-rise buildings over 18 metres built by the group where in-line with government guidance, cladding may need to be removed. Persimmon says it does not own any of these buildings and the legal responsibility and duty to ensure the building is safe rests with the current owners.
The firm says it will provide technical support to ensure the building is made safe. But, if a building owner fails to accept their responsibilities, Persimmon “stands ready to provide the support necessary to make sure the work is done”.
Persimmon adds: “For buildings below 18 metres in height the government has recommended a risk-based approach. The group has identified 17 buildings below 18 metres that may be fitted with cladding requiring detailed investigation. Where Persimmon owns the building it will, of course, lead this work. Where the group no longer owns the building, it will support the owners and other parties in their efforts to ensure the buildings are safe for residents. Once again, should a building owner fail to meet their obligations, Persimmon stands ready to provide the support to make sure this happens.”
Roger Devlin, chairman of Persimmon, said: "The concern around now banned cladding is affecting many thousands of homeowners who live in high-rise buildings right across the country.
"At Persimmon we believe we have a clear duty to act to address this issue. So today we are setting aside £75 million towards any necessary cladding remediation and safety work in 26 developments we built. Where we still own the building we will act. Where we no longer own them we will work with the owners to make sure they meet their legal responsibilities and duty. If the owner does not step up then we will act to remove uncertainty and anxiety for residents and make the buildings safe.
"This is a decision which we believe is not only right for residents but also the right thing for us to do as one of the leading housebuilders in the UK. We want Persimmon to be a business with a long-term, responsible and sustainable future and hope our actions today demonstrate a clear commitment to these values."
