Author : Maryanne Bowring
More on cladding today. Leaseholders must not pay cladding costs, says the select committee which has been scrutinising the Government’s draft Building Safety Bill. MPs have reported their findings and there are two key points which give hope to leaseholders in blocks with dangerous cladding.
The Housing Select Committee is urging the Government to stick to the principle that leaseholders should not pay anything towards the cost of remediating historical building safety defects. In order to provide leaseholders with the peace of mind they deserve, they are recommending the draft Bill is amended to explicitly exclude historical costs from the building safety charge.
As it stands, the draft Bill allows landlords to recover the cost of building safety measures through a new building safety charge. This charge means landlords can pass on the cost to leaseholders of putting right historical building safety defects for which they were not responsible. And to add insult to injury, the Bill includes a provision that payments must be made within 28 days. MPs consider this unacceptable – and so do we and many others in the industry. The select committee describes this as “an abdication of responsibility on the part of government”. We couldn’t agree more.
In order to tackle the problem of building safety remediation work once and for all, the committee is calling on government to announce, before it publishes the Bill, its proposals for funding these works. The committee’s report specifically says that the proposals should impose “no costs on leaseholders”. They should also explicitly acknowledge that in the short term the Government must foot the bill, until other mechanisms for cost recovery have been developed.
At present, the financing of remediation works remains unresolved, despite the allocation of £1.6 billion in the building safety fund. This situation has gone on far too long and is impacting the lives of thousands of leaseholders to an unacceptable degree.
The select committee report falls firmly on the side of leaseholders and says that if the costs are not to be borne by flat owners the Government must propose an alternative source of funding. Only two viable and acceptable options exist, they say: central government and industry. We agree.
However government ultimately chooses to fund the work, the committee insists it must publish these proposals with the draft Bill. Its argument is that “no future building safety regime can be adequate that does not also remedy historical defects”. That’s a view that is hard to find fault with, as we move into a whole new era for building safety. Public confidence in the safety regime has been badly damaged by the findings that followed Grenfell and by the faults in the system unearthed by the ongoing inquiry. If faith is to be restored, government must act.
Mary-Anne Bowring FIRPM FRICS FARLA FCABE Founder/Head of Asset Management
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