Association of Residential Managing Agents

Members' Area

Government Announces Further Support to Help End the Cladding Crisis

Almost four years after the Grenfell Tragedy, ARMA welcomes the Secretary of State’s announcement today that an additional £3.5bn in funding will be provided to help remediate buildings over 18 metres with unsafe cladding to add to the £1.6bn already earmarked. The ‘exceptional intervention’ marks increased Government support for leaseholders trapped in unsellable flats that are at risk from potentially deadly fires. The culmination of an industry-wide effort, the announcement proves that ARMA’s extensive work with the MHCLG, industry bodies, cladding action groups, press and TV and engagement with scores of MPs over the years has played its part in ensuring that further action on cladding remediation has remained high on the Government’s agenda.

The announcement won’t solve the entire problem, however, and details on financial support for buildings with unsafe cladding in Wales has not yet been discussed. Buildings below 18 metres with dangerous cladding won’t benefit from the fund in the same way. Instead, a long-term loan scheme for 4-6 storey flats means leaseholders could still face bills of up to £50 a month for cladding remediation. Whilst this may be significantly less than their previous costs, many leaseholders will still find themselves paying to put right building defects which they did not cause, and these loans will likely crystallise upon the sale of a flat.

In addition, the new building safety regime will inevitably mean added fire safety costs in the form of compartmentation, fire doors and fire breaks, which may be equivalent to cladding costs and likely be required across the whole housing stock. These costs are not covered by the funding announced today.

For the first time, a new industry levy and tax for developers means those working within the construction industry will be set to contribute towards historical defects, helping to "right the wrongs of the past’. Whilst some developers have come forward to fix buildings, many have not. The task of chasing developers, who may be shell companies or now be long gone, is not a simple one.

Also, in today’s announcement, the Rt. Hon. Robert Jenrick hinted at the ‘freeing up’ of the EWS1 process for leaseholders – something we keenly await details on. 

Whilst the Secretary of State's speech will be met with overwhelming relief for leaseholders living in the highest-risk buildings over 18 metres, there will be plenty of others who will continue to criticise the Government for not going far enough. The reality remains that there is simply not enough money to go round to completely solve the hugely complex cladding and building safety crisis. Having said that, let us at least take a few moments to celebrate a massive intervention by the Government as we should be looking at it, at the very least, from a "glass half full" standpoint.

 

The Government’s five-point plan to bring an end to unsafe cladding

  1. Government will pay for the removal of unsafe cladding for leaseholders in all residential buildings 18 metres (6 storeys) and over in England
  2. A finance scheme to provide reassurance for leaseholders in buildings between 11 and 18 metres (4 to 6 storeys), ensuring they never pay more than £50 a month for cladding removal
  3. An industry levy and tax to ensure developers play their part
  4. A "world-class" new safety regime to ensure a tragedy like Grenfell never happens again
  5. Providing confidence to this part of the housing market including lenders and surveyors

To read the full Government press release, click here.