Measures under consideration include a £5bn grant for leaseholders and £2bn levy on developers

Ministers are poised to announce billions of pounds in extra support to address the cladding crisis that has left homeowners bankrupt and distraught, though key questions remain over how much leaseholders will be expected to contribute.

Robert Jenrick, the communities secretary, will announce the new measures in parliament on Wednesday after reaching a deal with the Treasury, the Guardian understands.

Ministers will be under intense pressure, including from Conservative MPs, to stop hundreds of thousands of flat owners being forced to pay vast sums to replace flammable cladding.

The measures follow more than three years of uncertainty since the fallout of the 2017 Grenfell Tower disaster, which exposed the dangerous defects in thousands of apartment blocks, and the ensuing building safety crisis rendering homes unsellable, unmortgageable and uninsurable.

The scale of new support has not been confirmed, but measures under consideration include a £5bn grant in addition to the existing £1.6bn building safety fund that leaseholders can apply to. The existing fund has been widely acknowledged as too small, as investigations uncovered a wider range of fire safety defects beyond combustible cladding.

Around 274,000 flats are estimated to have dangerous cladding, according to the Association of Residential Managing Agents, equating to more than 650,000 people, although that figure is likely to reach into the millions when those living in lower rise structures where problems have also emerged are taken into account.

One industry source told the Guardian they expected the funding to only cover the replacement of cladding rather than other safety faults. They said grants were expected to cover remediation of buildings over 18 metres and loans are likely to be offered for shorter buildings.

The charity Leasehold Knowledge Partnership said such a policy would be a “bitter disappointment for leaseholders everywhere” and it would be “shameful to treat leaseholders differently depending on an arbitrary factor like building height”.

It said: “Leaseholders in tens of thousands of buildings less than 18 metres have been told they will pay 100% of the costs of fixing others’ mistakes. Leaseholders in buildings above 18 metres may still face ruinous costs of fixing non-cladding defects.”

The government has also considered a £2bn levy on property developers and builders over the next decade, charged at £200m a year. Discussions have reportedly been under way about boosting the amount of money available with long-term government loans to leaseholders.

Over the past two years, the government has announced a series of measures to try to fix the problem, including a £1bn building safety fund to help with the cost of removing cladding and £30m to pay for alarm systems.

The government is also keen to swerve a parliamentary defeat after more than 30 Conservative MPs signed an amendment to the fire safety bill now being passed between the Commons and Lords, which would bar building freeholders from passing the costs of removing cladding or other fire safety work on to their leaseholders.

Ministers have been under increasing pressure in parliament to act on the crisis, which leaseholders have said left them bankrupt and suicidal. Labour and a significant number of Tory backbenchers have warned ministers that not enough is being done to help leaseholders. Last month Labour called for an independent taskforce on cladding and guaranteed funding for work to make buildings safe.

Asked by the Conservative MP Bob Blackman last year whether he would guarantee that leaseholders did not pay “a penny piece” towards the safety measures, Boris Johnson said he did “not want to see leaseholders being forced to pay for the remediation”. Blackman told the Guardian on Tuesday that the prime minister must “stick to his promise”.

Rituparna Saha, the co-founder of the UK Cladding Action Group representing thousands of affected leaseholders, said the measures should be the full £15bn, which is the estimated cost of all required work – “a substantial proportion of that recovered from the construction companies”.

Leaseholders have been hit with huge bills not just for fixing their homes, but also with soaring insurance premiums and costs such as paying for 24-hour waking watch patrols. Homes have been left unsellable and tenants and leaseholders have reported a wave of financial and mental health problems as a result of the crisis.

Saha said she feared the announcement would not go far enough: “We need once and for all substantial measures. The government has been dragged kicking and screaming into making these announcements and it is not good enough any more because people are being made bankrupt.”

Labour’s shadow housing secretary, Thangam Debbonaire, said: “Whatever is announced will be too late for those first-time buyers who have already gone bust. Ministers have promised 17 times leaseholders wouldn’t have to pay for a crisis they didn’t cause. A cladding tax on leaseholders would break that promise. The government should protect leaseholders and the taxpayer, by providing upfront funding and pursuing those responsible.”

source: Jessica Elgot 

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