No backsliding: Developer safety ‘pledges’ must be turned into unambiguous legal contracts without further delay
In April, Michael Gove announced that the biggest UK homebuilders had ‘pledged’ to fix all unsafe buildings over 11 metres in height that they had played a role in developing in the last 30 years.
The Department for Levelling Up, Housing and Communities (DLUHC) press release declared this ‘a victory for leaseholders’ – although we think leaseholders will be the judge of that, and the devil is still very much in the detail.
In January, Michael Gove’s letter to the Residential Property Developer Industry had originally called for a clear fully-funded plan of action that could be made available to the public and affected leaseholders by the end of March; over seven months have passed since that initial deadline and no clear plan of action has yet emerged.
The Government’s deadline for turning developer pledges into legally enforceable contracts came and went three months ago – but a trio of Secretaries of State have insisted there will be ‘no backsliding,’ which is welcome news. Developers must finally be made to focus on our safety ahead of their profits.
Homes cannot be made half-safe
It is essential that all building safety defects are fully remediated and that all work will meet consistent and transparent standards.
DLUHC has repeatedly told leaseholders that, where a developer has ‘pledged’ to take responsibility, this means all cladding and non-cladding safety defects are covered. Despite this, ever since the Building Safety Act prevented them from passing costs on to innocent leaseholders, we have seen developers and their industry body, the Home Builders Federation, pushing back in an attempt to minimise the potential scope of work, with a focus on defining what is ‘life critical’.
It is essential that commitments are not watered down – homes cannot be made half- safe. There must be true certainty that no further work to fix safety defects will be required at a future point, otherwise confidence will not return to the market for flats. Homes will permanently lose value and leaseholders will continue to struggle to remortgage or sell, while building insurance premiums will remain sky-high indefinitely.
Contracts must commit to an end-date that frees leaseholders as soon as possible
Where developers are taking over responsibility for remediation projects, there has been a clear and detrimental impact with delays to ongoing works or planned works. Once contracts are finally signed, we hope to see this translate into work happening on the ground at a far quicker pace.
Leaseholders have already been trapped in homes that are unsafe for more than five years since the Grenfell tragedy, unable to sell or remortgage their homes until there is true certainty about future costs and the remediation timetable. It cannot be reasonable for leaseholders to remain trapped for years longer, unable to move on with their lives. How many years should we have to wait to finally get the product that we bought and paid for – a safe home?
Developers must prioritise making their existing homes safe ahead of building new homes; leaseholders want to see consequences for developers where they do not.
All developers must be held to account
Many leaseholders feel abandoned by the Government because it has only asked a portion of developers to sign up to the pledge so far.
There are still many homebuilders that have not made any commitment to sign the pledge – including
Lendlease, Galliford Try and many more developers who have benefited from generous taxpayer subsidies over the years.
All developers who played a role in developing or refurbishing properties with building safety defects should be held to account – and there must be commercial consequences for those who refuse to step up, do the right thing and take responsibility for making their homes safe.
Developer responsibility must apply to buildings of all heights
The scope of the pledge is currently restricted to buildings over 11 metres in height, but many low-rise buildings were constructed using unsafe materials, including the same cladding that was on Grenfell Tower. Those buildings also suffer from unfit internal compartmentation that allows fire to spread rapidly.
We know from serious fire incidents since Grenfell – such as at Richmond House in Worcester Park and the Beechmere care home in Crewe – that low-rise buildings will sometimes be high risk and require significant remediation or mitigation works to make them safe.
In some cases – which both we and the affected leaseholders have detailed directly to the Government – leaseholders in low-rise blocks with safety defects are facing remediation costs that far exceed the maximum cost enshrined in the Building Safety Act for ‘qualifying’ leaseholders. Some of these blocks were developed by homebuilders that have already signed the pledge – but they are refusing to take any moral responsibility below a still-arbitrary height threshold.
Any developer that wishes to call itself responsible, as they all repeatedly tell us they are, should be stepping up to make all their homes safe, regardless of height. It will be essential to rebuilding market confidence in low-rise properties, otherwise we will see a two-tier market develop with all low-rise flats remaining very difficult to sell. No one will want to buy a low-rise flat if it comes with the potential for uncapped liability for safety defects.
The Government’s current approach, based on a vague promise to look at low-rise buildings on a case-by-case basis by then Housing Minister Stuart Andrew on 20 April, is an ineffective, inappropriate and deeply unfair way to resolve this issue. Leaseholders in buildings under 11 metres are equally as blameless as those in taller buildings. If it is morally wrong for leaseholders to pay the price for a national building safety crisis from which others profited, as Michael Gove clearly stated in the House of Commons in January, then that logic applies to all leaseholders.
As Lord Young of Cookham noted during the passage of the Building Safety Bill, if there are so few examples of low-rise buildings that need extensive work, then it follows that “the cost of putting this inequity right is so small.” If the Government is truly “on the side of leaseholders and residents”, there must be firm, defined action to support these warm words.
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