Government gives developers six weeks to sign contract to fix unsafe cladding

Published on 01.02.23
Published on 01.02.23

There has been a major development in the ongoing building safety crisis triggered by the Grenfell Tower fire in 2017. The government announced on 30 January 2023 that developers and not leaseholders must pay to remediate unsafe buildings and cladding issues. Any developers refusing to pay to repair defects could be banned from selling new homes. Christina Antonas examines the government’s plans.

Since the cladding issue began, building owners had been charging leaseholders to pay to fix cladding problems and defects through excessive service charge bills, in some cases making their flats unsellable.

The announcement by the Department for Levelling Up, Housing and Communities (DLUHC) that developers have six weeks to sign a legally binding contract committing them to repair unsafe buildings is a significant step towards resolving the crisis.

Developers have until 13 March to agree to what the government describes as a “fully funded plan of action including remediating unsafe cladding on 11-18 metre buildings”. The government plans to bring forward legislation in the spring giving the Secretary of State powers to prevent developers from operating freely in the housing market if they fail to sign and comply with the remediation contract.

Under the contract, developers will commit an estimated £2bn for repairs to buildings they developed or refurbished over the past 30 years. The contract also requires developers to reimburse taxpayers where public money has been spent fixing unsafe buildings.

Secretary of State for Levelling Up, Housing and Communities Michael Gove says:

“Our home should be a source of security and pride. For too many of the people living in properties your industry has built in recent years, their home has become a source of misery. This must change. It is neither fair nor decent that innocent leaseholders, many of whom have worked hard and made sacrifices to get a foot on the housing ladder, should be landed with bills they cannot afford to fix problems they did not cause.”

This long overdue action being taken by the government on building safety is part of a wider programme to create a fairer housing system.

If you require further information on this article, please contact Christina Antonas at [email protected].

Disclaimer: The above is merely general guidance and should not be relied on as formal advice. We suggest you take professional advice before taking any action in relation to the issues discussed above.