Response from CIOB to the announced proposals on cladding remediation

This afternoon the Government announced a package of measures intended to help with the remediation of potentially unsafe cladding on high-rise buildings. Robert Jenrick MP, Secretary of State for Housing, Communities and Local Government, outlined what he called an “unprecedented intervention” with four key proposals: 

1.             Leaseholders in high-rise residential buildings will not face costs for cladding remediation works, with the Government making funding available to pay for removal and replacement of unsafe ACM (Aluminium Composite Material) cladding for all leaseholders in high rise residential buildings 18m or above (or over 6 stories). 

2.             On low and medium rise blocks of flats, where the risk is deemed to be lower, Government will develop a long-term financing scheme with support for cladding remediation for buildings between 4 and 6 stories, on a long-term low interest basis. The Secretary of State said this will mean leaseholders will not pay more than £50 a month towards the removal of unsafe cladding. 

3.             A new “gateway to developer levy” will be implemented via the Building Safety Bill, to be targeted at larger developers when they seek permission for certain types of high-rise buildings in England.  

4.             A new tax will be introduced for the UK residential property development sector in 2022. It was suggested that this will raise at least £2bn over a decade to help pay for cladding remediation costs, with the proposal intended to ensure that the largest property developers make a contribution in relation to the money they make. The Secretary of State added that Government shall consult on the policy design in due course. 

The CIOB issued a call last week to the Government, to commit to acting immediately on finding a funding solution which does not penalise leaseholders and leave them burdened with paying, even in part, for historical building safety remediation works, whilst also ensuring that these costs are excluded from the proposed building safety charge. 

Today’s proposals are clearly still placing a burden on leaseholders and are unacceptable. 

Caroline Gumble, CEO of the CIOB, said: “The CIOB has been monitoring the issue of cladding and building safety for some time now – it is clearly a matter of public interest and relevant across the breadth of the construction industry. While there is no doubt that the construction industry has a role to play in ensuring that a situation such as that which led to the Grenfell tragedy can never happen again, there is also leadership required from government to work with the industry and residents impacted by this issue. It must be remembered that up to 11 million people in the UK are in accommodation that is potentially unsafe and this is causing unnecessary distress to so many, especially with the current lockdown and people literally being stuck in high risk flats. The proposals outlined today will only help to alleviate the distress of a fraction of those affected and we need to see a more practical and targeted response from Government, with a solution ensuring that no leaseholders will bear any financial burden for remediation.” 

There is still further detail required on today’s announcement and the CIOB has already highlighted concerns about the impact of the proposals on leaseholders, particularly those living in buildings under 18 metres. The CIOB submitted evidence to the Housing, Communities and Local Government Committee's pre-legislative scrutiny of the Draft Building Safety Bill last year and its recommendations were incorporated in the Committee's final report. The Government has not yet formally responded to this report. 

The CIOB has observed that work to improve safety and drive up quality has already started among key industry stakeholders, with the CIOB and many of their sister professional bodies being present to support the Hackitt Review and the work that has come out of that. The industry has responsibility to help find the solution to this crisis and we are pleased to see that some companies in the housebuilding sector are taking steps in the right direction.  

More information on today’s announcement can be found here: https://www.gov.uk/government/news/government-to-bring-an-end-to-unsafe-cladding-with-multi-billion-pound-intervention.