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Alberto Costa MP

Member of Parliament for South Leicestershire

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Cladding, Leaseholders & The Fire Safety Bill

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Decisive action is precisely what is needed to end the cladding scandal, which is why it is very encouraging that a further £3.5 billion has been recently announced toward cladding remediation, bringing the total funding to £5 billion.

The Housing Secretary confirmed that the Government will fully fund the replacement of unsafe cladding for all leaseholders in residential buildings 18 metres and higher in England, which have been independently judged to be the highest risk buildings. For leaseholders in lower-rise buildings between 11 and 18 metres, a new scheme will protect against unaffordable cladding removal costs through a financing arrangement where leaseholders pay no more than a maximum of £50 per month toward remediation when the building owner cannot pay for the work.

I welcome this reassuring announcement, which will provide security to leaseholders and protect against excessive costs. This funding should mean that banks and mortgage lenders have certainty that remediation costs for these buildings will be paid for, and balances the Government's commitment to helping leaseholders with a responsibility to taxpayers.

Indeed, remedying the failures of building safety cannot just be a responsibility for taxpayers. That is why plans to introduce a new Gateway 2 developer levy have also been announced, which will apply to developers seeking permission on certain high-rise buildings and is expected to raise £2 billion over a decade. This will help ensure that taxpayers do not foot the bill for remediation and ensure large property develops contribute to the national remediation effort.

These measures will provide certainty to residents and lenders, boosting the housing market, reinstating the value of properties and getting to buy and selling homes back on track. Work is underway with lenders and surveyors to make this happen.

Looking towards the future, new legislation is expected to be brought forward this year to protect future generations from similar mistakes by tightening the regulation of building safety and reviewing the construction products regime to prevent malpractice arising again.

Taxpayer funding should not be the only means used to remediate buildings. In more than half of cases where ACM cladding is present in private sector residential blocks, the original developer or building owner has agreed to pay, or such costs are covered through an existing warranty.

I welcome the new £30 million Waking Watch Relief Fund to cover the cost of fire alarms to reduce dependence on costly waking watches. The National Fire Chiefs Council has been clear that building owners should move to install common fire alarm systems as quickly as possible, which will reduce costs for affected leaseholders.

The Building Safety Bill will introduce a new era of accountability, making it clear where the responsibility for managing safety risks lies throughout the design, construction and occupation of buildings in scope. There will be tougher sanctions for those that fail to meet their obligations.

The Bill also includes provision for the building safety charge which is designed to give leaseholders greater transparency about the costs incurred from maintaining a safe building. These costs would otherwise be recovered from the annual service charge as per the terms in most leasehold agreements. The Bill includes a number of protections, including allowing the Government to limit the scope of what can be recovered from leaseholders. 

Parliamentary scrutiny of any legislation is vital and I will bear in mind points raised by colleagues about this important Bill.

Under the new statutory terms, the landlord commits to the leaseholder to carry out the necessary measures, apply for any available financial support and observe the statutory requirements in relation to raising charges. In return, the leaseholder commits to the landlord to pay a fair share of reasonable charges and co-operate with the building safety regime. I was glad to learn that Ministers are particularly committed to looking further at the question of costs throughout the process of scrutiny and as the Bill is finalised for introduction.

Leaseholders should not have to worry about the unaffordable costs of fixing safety defects in high-rise buildings that they did not cause – and should be protected from large-scale remediation costs wherever possible.

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Alberto Costa MP Member of Parliament for South Leicestershire

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