Cladding crisis: Flat owners living in fear of bankruptcy say billions promised isn't enough

A new £3.5bn fund to help remove unsafe cladding has been described as "utterly disappointing" by flat owners at risk of bankruptcy.

It's thought 143 buildings across Yorkshire are affected, with thousands of leaseholders facing hiked insurance costs, 24-hour fire wardens and flats which are now unsellable.

The fund will cover the removal of cladding for buildings over 18 metres, but buildings under that will be offered loans of "no more than £50 per month."

Jenni Garratt lives in the Wicker Riverside building in Sheffield, where dozens of residents were forced to leave their flats until 24-hour wardens were installed.

She said: "Today's announcement is utterly disappointing. We were hoping it would have taken into account all the issues that people have been screaming about for months and it's only addressed a very small part of the problem.

"When the Grenfell tragedy happened it exposed dangerous cladding, but when you ripped off the cladding, it exposed a huge array of other problems.

"This is about so much more than cladding and it feels like we've been completely ignored."

"There are hundreds of thousands of people who live in buildings under 18 metres which are just as dangerous, who can't sell their properties.

"Why should I, someone who happened to buy a flat in a 18 metre plus building be given a full grant, but if you bought a flat in a building one storey lower, you have to pay a loan back with interest?"

Earlier this month, ITV Calendar reported on one Leeds woman who has already gone bankrupt due to the hiked costs associated with cladded buildings.

In a Commons statement, Housing Secretary Robert Jenrick said the "exceptional" intervention means no leaseholders in high-rise blocks in England will face charges for the removal of unsafe cladding.

But his announcement drew a furious response, with critics - including some Tories - warning it fails to address the problems faced by residents living in unsellable flats in unsafe blocks.

Housing, Communities and Local Government Secretary Robert Jenrick Credit: Pippa Fowles/Crown Copyright/10 Downing Street/PA

There was no mention on covering other fire safety issues or interim measures, such as insurance hikes and increased service charge, which are currently costing many hundreds of pounds extra per month.

Sheffield South East MP Clive Betts said this money "will only go so far" and Leeds Central MP Hilary Benn added: "It seems the commitment to pay to make safe buildings above 18 m or six stories only covers the removal of dangerous cladding and not missing firebreaks and wooden balconies.

"So who is going to pay to fix these? It cannot and must not be leaseholders."

The Government did also announce a new levy on developers of certain high buildings in England and a £2 billion UK-wide tax on the residential development sector.

Mr Jenrick said that, without the Government's intervention, many building owners would have continued to pass on the costs of cladding remediation work to leaseholders.

Natasha Letchford, a campaigner for the End Our Cladding Scandal group, said the funding was "disappointing" and would not go far enough to fix all issues, highlighting estimates putting the total bill as high as £15 billion.

"We welcome more money, but the reality is it won't make buildings safe and it won't, we don't think, free up the housing market," she said.

"As long as there is outstanding bills on these properties they will be worthless and people simply won't want to buy them. I think essentially it won't go far enough."

Grenfell fire Credit: PA

She argued that the Government should "upfront fund" remediation of all issues on buildings of any height and then seek to claim costs from builders and developers.

She said loan-scheme plans to ensure leaseholders in lower and medium-rise blocks of flats will never pay more than £50 a month towards the removal of unsafe cladding would still be a "significant outgoing" for those on low incomes.

Ms Letchford said: "My fear is huge bills. Obviously some if it will be covered, but if they say for example, we're covering the cladding but we're not covering the fire breaks and we're not covering the internal compartmentation, we could still be face a bill of £20,000-£40,000."

She said she went to bed every night "not knowing how quickly the building would go up if there was a fire" and had been struggling with panic attacks and anxiety.

The House of Commons has previously heard how huge numbers of people, especially leaseholders, are “stuck in the middle” and living in “unsafe homes” which they cannot sell, but are being asked to “foot the bill” for remediation works.

Earlier this month, Labour demanded the creation of a national taskforce to “get a grip” on the cladding crisis, with their opposition motion supported by 263 votes to zero.

Residents of buildings with flammable cladding have said it has made their flats “worthless” and they are “trapped” and unable to sell the properties.

At last week’s Prime Minister’s Questions, Boris Johnson said: “We are determined that no leaseholder should have to pay for the unaffordable costs of fixing safety defects that they didn’t cause and are no fault of their own.”