Government funding for safety repairs in tall buildings
Michael Gove has announced an agreement which will see the industry contribute £5 billion to address the tall building safety scandal (which will benefit leaseholders). This agreement will result in developers committing to a minimum of £2 billion to fix buildings that they have constructed. Through an expansion to the Building Safety Levy, industry will also pay up to a further £3 billion.
What will happen under the new agreement?
Following the new agreement more than 35 of the UK’s biggest developers have pledged to repair all buildings 11 metres and higher, that they have played a role in developing in the last 30 years. This agreement will become legally enforceable.
Secondly, the Secretary of State has announced that companies who are still yet to make the pledge, do not have long left to sign up. Those who continue to refuse will face consequences.
Moreover, this new scheme will see industry pay for the repairs to the buildings, if the people responsible cannot be traced. Or they will be forced by law to repair the building by law. This closely follows previous confirmation that the plans for a 30-year loan scheme, paid for by leaseholders, would be abandoned.
Funding for the new scheme
This scheme is funded through an extension to the Building Safety Levy. Additionally, this will be made chargeable on all newly built residential buildings in England. It is predicted that this will raise up to a further estimated £3 billion, over the course of 10 years from developers. Subsequently, this will ensure that no leaseholder in medium-rise buildings would be liable for a large bill. Even if the developer can’t be located.
Following on from the announcement back in February regarding the new proposed laws under the Building Safety Bill. It ensures that any qualifying leaseholders are protected and safeguarded from any safety defects, which have happened in the past. Furthermore, with the deal today it states that it would not be the leaseholder who would pay for the repairs. It would be the industry responsible.
Michael Gove said:
“Today marks a significant step toward protecting innocent leaseholders and ensuring those responsible pay to solve the crisis they helped to cause”
“I welcome the move by many of the largest developers to do the right thing”
“But this is just the beginning. We will do whatever it takes to hold industry to account, and under our new measures there will be nowhere to hide”
What is in the agreement:
- Developers to move as quickly as possible to fix their buildings
- To put into effect new guidance on the safety of buildings
- Regularly keep in contact and reporti to the government and leaseholders on any progress that has been made
- Respect any independent dispute resolution process which has been undertaken or initiated by the government
- To make sure that they refund any money that they have already received from the taxpayer to fix their buildings
Have any further questions?
Please contact a member of the team here or alternatively call the office on 01903 234094