Cladding crisis: committee calls on government to scrap cladding loan scheme and prioritise most at risk

An influential committee of MPs has called on the government to abandon its loan scheme for residents trapped in apartments with unsafe cladding.

Ministers have repeatedly said leaseholders should not have to pay for repairs, which often run into millions of pounds.

But many are already receiving bills, and the fund from the government only covers flammable cladding and not a range of other building safety defects.

Giles Grover from the Manchester Cladiators, gave Granada Reports his reaction to calls for a re-think in government support.

In February billions of pounds of extra money was promised to help flat owners and leaseholders tackle the cladding crisis.

The cash was announced more than three and a half years after the Grenfell Tower disaster.

But now the Housing, Communities and Local Government Committee has urged the Government to re-commit to the principle that leaseholders should not have to pay for the removal of unsafe cladding from their homes.

It comes as many affected by unsafe cladding were left out of funding due to the height of their building.

The funding is only available on only high-rise buildings of 18 metres and above, leaving those living in buildings up to six storeys footing the bill still.

The Committee says residents who are most at risk should receive funding support first - rather than using building height and materials to work out help.

It added that proposals to fund cladding remediation on buildings below 18 metres through a loan scheme, requiring leaseholders to pay up to £50 a month, should also be abandoned.

What is the Committee calling for?

  • An enhanced Comprehensive Building Safety Fund - paid for by Government and industry.

  • The fund would be open to all buildings with existing fire safety issues with no barriers based on height, types of tenure or the nature of fire safety defects.

  • Priority should be given to buildings where residents are most at risk, assessed through holistic, evidence-based processes.

Committee chairman and Labour MP Clive Betts says: "In the years since the Grenfell tragedy, we have been shocked by the reality of the danger that flammable cladding poses, by how pervasive these materials are in modern buildings and by the frequency with which fundamental fire safety measures, including fire breaks and sprinkler systems, are simply not there.

"£5 billion in funding is significant, but just cannot match the ongoing legacy of these fire safety failings."

The approach has been welcomed by the Manchester Cladiators campaign group who say they should not have to pay for mistakes developers made.

In a statement they said: "Boris Johnson needs to listen to the advice of his own MPs and abandon plans for the cladding tax on hardworking leaseholders, many of whom are first-time buyers.

"The Prime Minister has already broken his promises to make sure no leaseholder pays to make their home safe. We won’t let him break that promise again."

The Department of Housing, Communities and Local Government maintains their approach "strikes the right balance".

It said: "This report is deeply flawed – we’re already prioritising making the tallest buildings with the most dangerous cladding safer, backed by £5 billion Government funding.

"We have been clear throughout that owners and industry should make buildings safe without passing on costs to leaseholders - and we will ensure they pay for the mistakes of the past with a new levy and tax to contribute to the costs of remediation.

"For lower-rise buildings which have a lower risk, our generous capped finance scheme will ensure bills are a maximum of £50 per month.

"Our approach strikes the right balance in protecting leaseholders and being fair to taxpayers."


Understanding the scale of the problem

  • The Committee claims the Government is not collecting sufficient data to understand the full scale of remediation needed for buildings.

  • This means the Government cannot know the true cost of remediation, timescales for buildings to be made safe, or the capacity of the industry to carry out the work.

  • The Government should include data of buildings of all those more than 11m high.

Comprehensive Building Safety Fund

  • The additional £3.5 billion funding towards cladding remediation announced in February is welcome but more money is needed to meet the costs of fire safety remediation.

  • A Comprehensive Building Safety Fund should be established which prioritises occupants most at risk

  • It should also cover all fire safety defects, including combustible insulation

  • Social housing providers should also have full access to funding.

Loan scheme

  • The Government's proposed loan scheme, whereby leaseholders contribute up to £50 a month to pay for cladding remediation works on buildings between 11m and 18m high, fails to satisfy the principle that leaseholders should not have to pay for fire safety remediation work.  

  • The loan scheme should be abolished. Instead, costs should be fully met by the Comprehensive Building Safety Fund, paid for by the Government and the industry.

Health of residents

  • The Government is not doing everything it can to support the physical and mental health of residents of affected buildings.

  • The Government should work with local authorities to ensure that affected residents have access to the physical and mental health support they need. 

Developer levy

  • Developers can and should be expected to make a greater contribution to the costs of remediation.

  • The developer levy tax should be extended and serve as an additional contribution to the Comprehensive Building Safety Fund. The Government should also work with stakeholders to ensure that no costs recovered through this scheme are passed on to house buyers, including housing associations.

  • Further work should also be carried out to examine how other sectors of the wider building industry, such as product manufacturers and suppliers, can contribute to the costs of fire safety remediation.

Social Housing

  • The exclusion of social housing landlords from the Building Safety Fund risks negative consequences for the wider social housing sector.

  • They should have full access to funding support.