Buildings with ACM Cladding

With permission, Mr Speaker, I wish to make a statement on the remediation of private sector residential buildings with aluminium composite material cladding.

In the wake of the tragic Grenfell Tower fire, the Government acted urgently to address the serious fire and public safety risks exposed by the tragedy. Throughout, the safety of residents has remained our priority. We have from the outset sought expert advice, which together with our own testing programme has highlighted the unparalleled fire risk posed by ACM cladding of the type believed to be present on Grenfell Tower. The Government are clear that the type of ACM cladding believed to be on Grenfell Tower, and present on hundreds of other high-rise buildings, is not safe. This type of ACM is exceptional owing to the high risk it poses as an accelerant of fire. It did not comply with building regulations and should never have been put up.

For many years, building regulations have included a requirement that exterior walls be constructed to resist the spread of fire. Since the Grenfell tragedy, we have taken action to put that beyond doubt. We have amended the law to explicitly ban combustible materials from use in the exterior walls of all high-rise residential buildings, as well as in hospitals, residential care premises, dormitories in boarding schools, and student accommodation over 18 metres. That ban applies to all new buildings in these categories and to those buildings when major works to the exterior walls take place. The long-standing requirement that exterior walls should adequately resist the spread of fire continues to apply to all other high-rise buildings, including commercial buildings, being developed or undergoing major works to exterior walls.

With the support of local authorities and fire and rescue services, we have identified a total of 433 high-rise residential and other buildings with unsafe ACM cladding. All these buildings have been assessed by fire and rescue services and interim safety measures are in place where necessary, and these measures are kept under review by fire and rescue services, but we recognise that residents will have true peace of mind only when unsafe cladding has been removed and replaced with safe materials. In those buildings owned by local authorities and housing associations, we are making strong progress. We have made £400 million available to pay for the remediation of ACM cladding, and remediation has started or been completed in 87% of social sector buildings, with plans and commitments in place to remediate all remaining buildings.

We have also seen some progress in the private sector. Some building owners have acted swiftly and responsibly to put plans in place for full remediation of the cladding on their buildings and committed to protecting leaseholders from bearing the costs. This progress has been supported by the work of a remediation taskforce chaired by Ministers. In addition, where necessary, the Government are supporting local authorities to use their enforcement powers to ensure that building owners take the required action.

That said, too many building owners have failed to take responsibility. Many building owners have been too slow to co-operate to enable the prompt identification of buildings with unsafe ACM cladding and have since dragged their feet in planning for remediation. The result is that, almost two years on from the Grenfell tragedy, an unacceptable number of residents are still living in buildings that, while benefiting from additional safety measures in the interim, will not be remediated fully within an acceptable timescale.

Moreover, many leaseholders face unfair, and often substantial, costs. The Government believe this to be completely unacceptable. Leaseholders find themselves in this position through no fault of their own, and this is not morally defensible. The Housing Minister, my officials and I have all met residents affected by these issues and heard their personal concerns. We all appreciate their anguish and we pay tribute to their resilience and strength. I also want to acknowledge the continued work of Grenfell United, the UK Cladding Action Group and others. Many people told us they lived in constant fear—fear for the safety of their home; fear of the possibility of having to find tens of thousands of pounds for remediation; fear that they could no longer sell their properties and may have to forfeit them if costs are not met.

Where building owners have failed to step up, it is now imperative that the Government act. We must ensure the long-term safety of the people living in these buildings. The Government are therefore announcing today a new fund to unblock progress in remediating private sector high-rise residential buildings. First and foremost, this fund is about public safety. It will allow remediation to happen quickly, restore peace of mind and allow residents living in these blocks to get on with their lives. It will also protect leaseholders from bearing the cost. Building owners or those responsible for fire safety should prioritise getting on with the work necessary to make their buildings permanently safe. The new fund, which is estimated at £200 million, will cover the full cost of remediating the unsafe ACM cladding systems in privately owned high-rise residential buildings. This funding is being provided entirely for the benefit of the leaseholders in the buildings.

Important reforms of leasehold and implementing the Hackitt review’s recommendations on the safety of high-rise residential buildings are already in train. I will update the House on implementation in the coming weeks. When the new system is in place, it will help to prevent leaseholders from being confronted with unaffordable one-off charges.

Several developers and freeholders have already agreed to fund the costs of remediation and not to pass them on to leaseholders. Many of them have already agreed to maintain their commitment. The owners or developers who have made those commitments include Taylor Wimpey, Legal & General, Mace Group, Lendlease, Barratt Developments and Aberdeen Standard Investments. I commend them for the responsible and moral position that they have taken.

The fund does not absolve industry from taking responsibility for the failures that led to the ACM being wrongly put on buildings. As a condition of funding, we will stipulate that building owners must pursue warranty and insurance claims and any appropriate action against those responsible for putting unsafe cladding on the buildings, with moneys to be repaid to the Government.

We will write to all potential fund applicants by the end of next week to start engaging them in preparation for formal applications. We will also make funding conditional on the building owner or responsible person agreeing a contract to start remediation works within a set period. We will provide further details on the application process; I urge those who intend to apply to start developing ACM remediation proposals and costings so that applications can be made and processed promptly.

Everyone has a right to feel safe in their home. We want to see building owners acting to ensure that unsafe ACM is replaced without delay. That is why we are taking this exceptional step today. I commend this statement to the House.

I thank the Secretary of State for advance sight of his statement. His announcement is welcome and needed; most important, it should start to relieve the worry of the thousands of people who live day and night in a high-rise block that they know is unsafe. But why on earth have they had to wait for nearly two years? For two years they have had their lives on hold. How long will the thousands more who live in tower blocks with suspect non-ACM cladding have to wait for Government action?

Like the Secretary of State, I pay tribute to those who, with Labour, have campaigned hard for the Government to act: Grenfell United, the UK Cladding Action Group, the Manchester Cladiators, Inside Housing and hon. Members on both sides of the House. But after the solemn pledges made by the Prime Minister and other Ministers in the aftermath of the terrible Grenfell Tower fire, who would have thought that nearly two years later there would still be Grenfell residents in hotels and temporary accommodation, not permanent homes; that Grenfell-type cladding would still not have been replaced in almost eight in 10 blocks; that in over half of them, no work would have started at all; and that no comprehensive testing programme would have been done on the estimated 1,700 high-rise or high-risk buildings with dangerous non-ACM cladding? The Secretary of State says that the Government acted urgently. The sorry truth is that in the face of these post-Grenfell problems, the Government have been frozen like a rabbit in the headlights—too weak and too slow to act at every stage and on every front.

On the detail of the Secretary of State’s announcement, is the £200 million new money from the Treasury to his Department, or will it be taken from other housing programmes? Is the fund simply a bail-out for block owners and developers who will not do their duty to replace dangerous cladding? How will he ensure that they pursue liability claims and repay the public purse? Will he consider emergency legislation to make block owners actually do this work and pay for it?

I thank the right hon. Gentleman for his support for our announcement. It is right that the Government have acted, but I underline the fact that the primary responsibility rests and rested with the building owners and with those responsible. We have now stepped in because of the failures we have seen in the private sector, although we acknowledge and recognise the many building owners and developers who have done the right thing by stepping up and agreeing to provide or maintain funding to address the need for remediation.

The right hon. Gentleman asked about urgency and timing. We did act with urgency in terms of the advice given. Indeed, I indicated in my statement the challenges in identifying some of the blocks affected and the work that was done at pace with local authorities. In some cases, local authorities had to take enforcement action to enable us to survey and identify those buildings, working with the relevant fire authorities, to which I pay tribute for their analysis and advice, and with the expert panel that was set up to advise Ministers.

The right hon. Gentleman asked several questions about the nature and manner of my announcement. One question was about non-ACM cladding systems. He will know that a testing programme is under way to assess non-ACM systems. That work is already happening. Advice was provided by the expert panel in December 2017 and updated in December 2018. That has been the focus, but clearly we will act on information and evidence provided as a consequence of the further testing programme. However, I urge the right hon. Gentleman to be careful not to prejudge the outcome or the results that we expect in the weeks ahead.

The right hon. Gentleman asked about funding. We intend to manage funding for the policy through our existing significant programme budgets. To put that in context, if the full amount were used, it would represent something like 3% of this year’s financial programming. We will keep the House updated through the supplementary estimate. The size of the new fund is informed by the public sector fund’s utilisation and drawdown, by the financial support that has been provided by some of the developers and builders, and by the insurance that has been activated for a number of the buildings.

I warmly welcome my right hon. Friend’s statement, and thank both him and the Minister of State. I know that achieving this result has required significant legal complexities to be overcome, and I appreciate the fact that the Government have listened. This will come as a great relief to the residents of Northpoint, in my constituency, who, along with many others, have suffered stress as well as financial loss.

Can my right hon. Friend confirm that the fund will cover all cladding systems which include ACM cladding? As he knows, some cladding systems consist of a mixture of ACM and other forms of cladding, and it is obviously right for all systems to be subject to this protection.

I commend my hon. Friend for his strenuous efforts on behalf of his constituents in relation to Northpoint. I understand the issue that he has highlighted. The fund is intended to provide capital support for the removal of ACM cladding systems, including insulation, as well as the removal and disposal of existing cladding, replacement materials and labour. As part of the process of writing to building owners and of the subsequent work, we will specify that in greater detail to give reassurance.

I thank the Secretary of State for giving me advance sight of his statement. Any announcement of help for those affected by the Grenfell tragedy, directly or indirectly, must of course be welcomed, but as the second anniversary of the tragedy approaches, it is incredible that the public and MPs are still having to push for that help.

The first thing to establish is whether the fund will be enough to help those affected. Can the Secretary of State confirm that the £200 million that has been released will pay for work on all private towers, or are the reports that it will not be enough correct?

The replacement work has been described by the UK Cladding Action Group as a “cladding lottery”, because it covers only ACM panels of the type that helped to spread the fire at Grenfell. Combustible non-ACM cladding, and other fire safety problems such as faulty or missing fire breaks in wall systems, will not be covered. What additional action can the Secretary of State promise affected residents to ensure that these safety measures are completed in a full and joined-up manner?

People have reported losing their life savings on interim measures, being forced to delay starting a family because of the financial uncertainty or turning to drink or drugs, along with serious mental health issues. Does the Secretary of State believe it is acceptable that freeholders and developers have been allowed simply to refuse to pay to make their buildings safe, and does he believe that if changes to the law are required to force them to take their responsibilities seriously, the Government will give that serious consideration?

I thank the hon. Gentleman for welcoming my announcement. I should, for his sake, make it clear that this applies only in England, because, as he knows, responsibility for housing policy and building regulations is a devolved matter.

I have already responded to some of the points that the hon. Gentleman has raised. As I have said, the £200 million represents an estimate of the cost, based on the existing experience of remediation—some of the work that has already been done—and taking account of instances in which developers, or insurance, are already in place. It is there to provide capital support. It is because of the need for urgency that we are taking steps to ensure, as a priority, that there is no need to rely on interim measures, because of both the nature and the cost of such measures.

I absolutely endorse the hon. Gentleman’s broader point about the need for developers and freeholders to stand up and do the right thing: I have stated that very plainly on a number of occasions, and I am hugely frustrated by the action—or lack of action—on the part of a number of those involved. He asked about changes in the law; that issue clearly flows from the Hackitt review, and, as I have said, I will update the House.

I welcome the statement, but does the Secretary of State share my concern about the difficulties that the Department has had to surmount in order to be in a position to make such a statement, and about the fact that it was necessary in the first place? As he has said, many in the industry have acted responsibly and swiftly, but too many have not. May I encourage him, as he finishes—quickly, I hope—the work involved in responding to the Hackitt review, to apply that learning and the experience of just how difficult it has been for him and his Department to put this programme together, and to reflect in his response the fact that many residents have the same issues, day in day out, with the owners of the buildings in which they live? We should all bear in mind that while those owners are quite happy to take the gains that come with owning a building, they must also take the responsibilities that it brings.

I entirely agree with the points that my right hon. Friend has made. I think that she senses my real frustration and, indeed, anger at some of the practice that I have seen. We are taking this exceptional step because of the nature of the material with which we are dealing, but it has also shone a light on some of the wrongful and damaging practice that is out there, including practice in the construction industry. We are continuing to pursue those issues, and will follow through on them in our response to the Hackitt review.

I very much welcome the money, although I have to say that the Department‘s idea of urgency is not quite the same as mine, two years after Grenfell. I think that the Secretary of State was wise to make his statement just under the wire, before the second anniversary of that disaster. If he will be writing to owners in the next week or so, he presumably already knows what steps he will be asking them to take to comply with the requirement to seek compensation from those who installed the cladding when that is possible. If he knows what steps will be taken, will he share that information with us, and will he also tell us who will decide whether those steps are sufficient?

In the case of an individual building, it will be up to the owners to set out what steps will be required. Obviously we will inform them of the nature of the information that we require about, for instance, assessments and the various bids and tenders that we would expect to have been undertaken. The differences between individual buildings, the nature of the system and the extent of the ACM cladding on each building have been very much in our minds in relation to the operation of the public sector fund, and we will apply that experience to the operation of the new scheme. However, I understand that sense of the need for continued pace, given that where substantial works are required, planning permissions will be needed, and given the nature of some of the construction work that will be necessary. It is precisely that work in which we will be engaged.

I think my right hon. Friend is properly fulfilling the words that he uttered on 30 April 2018, when he said that leaseholders would not be left in the lurch. Members in all parts of the House will be grateful for that.

We fully understand why the Minister of State was unable to make a statement of this kind yesterday, at a meeting which was chaired by the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) and attended by members of the UK Cladding Action Group and many other experts. I hope that what was said at that meeting will be passed on to the Department, because it is important for us to continue to make progress, and we are grateful for the lead that my right hon. Friend has given.

Let me also say to my right hon. Friend that it is vital that he, and his permanent secretary, acknowledge the role of those at Leasehold Knowledge Partnership, who were the first to identify the fact that there was no simple solution. It was they who caused the Government to ask the Law Commission to look into the problems of leasehold. I ask him to ensure that his officials and LEASE, the Government’s Leasehold Advisory Service, respect Martin Boyd and Sebastian O’Kelly, without whom no Member of Parliament would have been able to get as far as we have, together, across the Chamber.

My hon. Friend rightly points out the contribution of many people in the steps that have been taken and in providing the essential technical and other information to inform and assist in the taking of robust action where required, and we will continue to engage in that. I pay tribute to my hon. Friend: he has been a passionate advocate of the rights of leaseholders and others across the House, and that pressure and contribution has helped to make a difference.

This bail-out for unscrupulous freeholders and developers is welcome, especially to leaseholders such as mine at New Providence Wharf, so I thank the Secretary of State and his ministerial colleagues for the money, as will the UK Cladding Action Group, the Leasehold Knowledge Partnership mentioned by the hon. Member for Worthing West (Sir Peter Bottomley) and Inside Housing—this statement probably guarantees the Secretary of State a splash front page in its next issue, which cannot do him any harm. The steps the Government have had to take show the weaknesses of the unregulated leasehold sector. Can the Secretary of State confirm that his Department will redouble its efforts to fulfil the promises of comprehensive leasehold reform as soon as possible?

I thank the hon. Gentleman for his comments and for his campaigning on these issues of fire safety, as well as on leasehold, over many months. Regardless of whether I look forward to coverage in Inside Housing, I recognise the work it has done in assisting and helping to shine a light on a number of these factors. As the hon. Gentleman knows, there are programmes of work by the Law Society and other agencies, and the Law Commission’s overarching work on leasehold is a separate programme that we intend to continue. We will continue to engage with the hon. Gentleman and others in relation to progress on that.