Bowing to mounting cross-party and media pressure, on 10 February 2021 the government announced further support to aid those worst affected by the post-Grenfell costs of remediating unsafe cladding.  Speaking in the House of Commons, the Housing Secretary, Robert Jenrick announced:

  • A further £3.5 billion is to be made available to replace ACM cladding on residential blocks over 18 metres (or above 6 storeys) in height, in addition to the £1.6 billion Building Safety Fund already made available for that purpose. The government has promised that no leaseholders of properties in this category will face any costs for such remedial work;
  • For what were described as “low to medium rise blocks” (those between 4 and 6 storeys in height), where the government considers remediation is less likely to be required, the government intends to develop a long-term scheme whereby government-backed, low interest loans will be made available to fund any necessary remedial work. The aim of such loans, which will attach to buildings rather than individuals, will be to ensure that no affected leaseholder in low to medium rise blocks has to make repayments of more than £50 per month towards the costs of necessary remedial work.  Further details will be published “shortly”.
  • The government will seek to recover some of the costs borne by the taxpayer in funding what was described as an “unprecedented intervention” in the housing market, by the introduction (in England) of a “Gateway 2 Developer Levy”, which will form part of the Building Safety Bill (currently working its way through Parliament). The levy will apply to those seeking permission to construct high-rise buildings in England.
  • In addition, a new tax will be introduced for the UK residential property development sector, with the aim of raising £2 billion over a decade. The government will consult over the exact details.

Mr Jenrick also commented on ongoing issues with EWS1 forms, noting that the government endorses the ongoing work of the RICS, which is consulting with its members and the public over the circumstances in which such forms should be required and when they are not necessary. In addition, the government announced that it is working towards a state-backed indemnity scheme for qualified professionals who are unable to obtain professional indemnity insurance for the completion of EWS1 forms.

Whilst the above developments have been favourably received by financial institutions, it seems to us that many questions remain to be answered, including:

  • Funding arrangements for cladding that has been deemed unsafe but is not ACM cladding.
  • Funding arrangements to resolve other building safety issues, including defective or missing fire breaks, and the ongoing costs of waking watches.
  • How will prospective purchasers of apartments in low to medium rise blocks view the prospect of long-term £50 monthly outgoings, and what effect will that have on the value of such properties?
  • How will the Gateway 2 Developer Levy work and, in particular, what “high-rise buildings” will be caught by it?
  • Will a similar levy be introduced by the devolved administrations?
  • How will a new tax work and who in the “residential property development sector” will be affected by it?

Our Building Safety Team will continue to monitor developments in this important and fast-developing area.  Please contact Joe Brightman, Ian Seeley, Molly Frankham or James King for more information, or email us on