Several flats in the UK became unsafe or unsellable following the cladding scandal, causing the death of 72 people in the Grenfell House fire. The recent unveiling of a pilot scheme comes as a breather for many flat-owners struggling with cladding issues as their homes become unsafe or unsellable. The UK government will fund the pilot with the proposed developer-backed Building Safety Levy of 3bn.

Hundreds of thousands of flat-owners living in properties whose developers are not traceable are in constant fear of an untoward event. They cannot afford costly repairs to fix the cladding. The pilot scheme focuses on medium-rise buildings between the heights of 11m and 18m whose developers are untraceable for repairs. According to the Department of Levelling Up, Housing and Communities, buildings requiring interim safety measures are eligible to apply for the scheme.

Protecting affected homeowners

Homes England is contacting 60 blocks that qualify for the scheme. These are blocks bearing the cost of maintaining waking watches for warning of fire incidences.

The pilot scheme will help repair unsafe walls and replace flammable cladding materials. The fund comes as a lifeline to flat owners who will, due to the fund, not be liable to pay for remediation work to restore building safety where the developer is not traceable. The government plans to roll out the Medium-Rise Scheme in 2023 enabling responsible entities to apply for the scheme benefits. Persons accountable for property repairs are responsible entities. These are:

Freeholders

Head planetrent.co.uk/blog/proposed-amendments-to-the-leasehold-reform-planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>tribunal-judgments-and-legal-costs-bill'>Leaseholders

Registered Provider of Social Housing

Right-to-manage Companies

Resident Management Companies

The Responsible Entity should share progress updates and information with planetrent.co.uk/blog/proposed-amendments-to-the-leasehold-reform-planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>tribunal-judgments-and-legal-costs-bill'>leaseholders. The Department of Levelling Up, Housing and Communities expects planetrent.co.uk/blog/proposed-amendments-to-the-leasehold-reform-planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>tribunal-judgments-and-legal-costs-bill'>leaseholders who feel they qualify for the Medium-rise Scheme to contact their responsible entity.

Cladding-hit leaseholders appreciate the move

The Medium-Rise Scheme received a positive response from flat owners living in unsafe homes who view it as a welcome move. Many planetrent.co.uk/blog/proposed-amendments-to-the-leasehold-reform-planetrent.co.uk/blog/could-a-tax-tribunal-ruling-mean-btl-investors-avoid-3-stamp-duty-surcharge'>tribunal-judgments-and-legal-costs-bill'>leaseholders waited over two years for remediation after facing rejection from the Building Safety Fund (BSF). There is skepticism about the fast-paced implementation of the scheme. It is because some flat owners did not receive funding despite qualifying for Building Safety Fund, as the building owner refused to sign the agreement. The pilot has renewed the hopes of flat owners living in 'orphaned' buildings because administrative bottlenecks impacted the original Cladding Fund. The pilot will help flat owners living in 60 buildings with interim safety measures.

Obstacles to levy-funded remediation

Since the government announced Building Safety Funds to remove ACM cladding in 2020, only fifty buildings benefitted from the scheme within the first two years. Buildings that are shorter than 11m may not receive any support despite unsafe cladding. Besides, there will be a long wait for the remediation of buildings not in the pilot. The medium-rise scheme will exclude buy-to-let landlords with over three properties who will be left to foot their share of the bill.

To address building safety risks on a priority basis, the government must remove bottlenecks. The government must continue to address the issues that caused regulatory disruptions leading to the building safety crisis. This is what the various 'start' and 'stop' gateways of The Building Safety Act 2022 seek to amend. Immediate release of funding to address fire safety risks is crucial, in addition to making it available to freeholders who cannot bear the crippling costs of remediation.

House builders oppose the levy

The house builders' lobby does not favor the Building Safety Levy describing it as an 'anti-development' tool.Housebuilders argue that The Building Safety Fund unfairly targets innocent people and victimizes them for the mistakes of others. The housebuilder's lobby wants the government to consider some facts before penalizing builders. These being:

1. To date, 49 builders have promised to remediate blocks over 11 meters. This is if they had any involvement in the development or refurbishment of the buildings in the last three decades.

2. They also agreed to pay back money if they received government funding. All owners must bear the entire cost of remediation of their buildings if their net worth is over 2m.