The government has promised that it would be delivering £3.5 billion in extra funding to pay for the replacement of unsafe cladding for all leaseholders in high-rise buildings 18 metres (6 storeys) and over, at no cost to residents.
Housing Secretary Robert Jenrick announced today (10 February 2021) that £3.5 billion will be committed to pay for the removal of unsafe cladding, adding to the £1.6 billion invested in the removal of cladding last year. Accompanying the announcement, the government unveiled its new 5-point plan to bring an end to unsafe cladding, which is intended to provide reassurance to homeowners and confidence to the housing market.
The Housing Secretary confirmed that the government would fully fund the replacement of unsafe cladding for leaseholders in residential buildings 18 metres (6 storeys) and over in England. The government claims this is to ensure that funding is targeted towards the highest-risk buildings.
For buildings below this threshold, the government announced that buildings between 11 and 18 metres will be protected from the costs of cladding removal with a new scheme that will pay for cladding removal, where necessary, through a long-term, low interest, government-backed financing arrangement. Under the scheme leaseholders will not have to pay more than £50 a month towards the removal of unsafe cladding.
In addition to the public funding, a new tax will be introduced for the UK residential property sector in 2022, intended to raise at least £2 billion over a decade to help pay for cladding remediation costs.
Five-point plan to bring an end to unsafe cladding
- Government will pay for the removal of unsafe cladding for leaseholders in all residential buildings 18 metres (6 storeys and over) in England.
- Generous finance scheme to provide reassurance for leaseholders in buildings between 11 and 18 metres (4 to 6 storeys), ensuring they never pay more than £50 a month for cladding removal.
- An industry levy and tax to ensure developers play their part.
- A world-class new safety regime to ensure a tragedy like Grenfell never happens again.
- Providing confidence to this part of the housing market including lenders and surveyors.
All buildings 18 metres and over will be covered by the fund. See further detail on building eligibility
Housing Secretary Rt Hon Robert Jenrick MP said:
“This is a comprehensive plan to remove unsafe cladding, support leaseholders, restore confidence to this part of the housing market and ensure this situation never arises again. Our unprecedented intervention means the hundreds of thousands of leaseholders who live in higher-rise buildings will now pay nothing towards the cost of removing unsafe cladding. Remedying the failures of building safety cannot just be a responsibility for taxpayers. That is why we will also be introducing a levy and tax on developers to contribute to righting the wrongs of the past.
These measures will provide certainty to residents and lenders, boosting the housing market, reinstating the value of properties and getting buying and selling homes back on track. We are working with lenders and surveyors to make this happen. Our landmark intervention will make homes safer and free those who did the right thing – saving for years to get on the property ladder – to enjoy the homes in which they have invested so much.”