Government ‘looking very carefully’ at ‘Polluter Pays’ proposal for building safety crisis

Asked about it in the House of Lords last month, building safety minister Lord Greenhalgh said: “We are very aware of the Polluter Pays Bill and the work that is being led by Steve Day of RAQ. We are looking at it very carefully to see whether it could further enhance the proposed Building Safety Bill.

“Of course, we have already looked at strengthening redress by extending the statutory limitation period in the Defective Premises Act 1972 from six to 15 years, applied retrospectively. This could provide further support to ensure that it is the polluter who pays. We are looking at that very carefully, as I said.”

Mr Day said the proposal is based on legislation covering contaminated land and had attracted the support of some key industry players, including mortgage lenders and builders. The proposal has been written by parliamentary counsel Daniel Greenberg, who is acting in a private capacity for the campaigners.

For blocks where no breach of building regulations or no responsible party could be found campaigners propose remediation costs should be covered through the public purse, topped up by a series of levies on industry. The government has already announced £5.1bn in funding for remediation.

Many attempts at legal challenges have stalled due to difficulties finding a clear breach of regulations or a party to sue.

This is because pre-Grenfell guidance permitted the use of combustible materials in various ways, for example combustible materials were permitted for use on balconies and ‘Class 0’ cladding was allowed in certain combinations, despite potentially being highly combustible. Buildings below 18 metres meanwhile were not subjected to any restriction on the combustibility of materials on their facade.

Many blocks that complied with these rules are now believed to be dangerous and require expensive remediation, which developers have insisted they are not responsible for.

However, Mr Day told Inside Housing that while many materials choices complied with the guidance, the botched installation of systems still opened the door to find a breach of the rules.

He said: “The materials may be compliant but they installed them not to manufacturers instruction, which breaches regulations. People don’t realise that so many buildings are defective and the developers have hidden that very well.

“The government are interested because they know how much money we can get for them through this.”

There have also been difficulties tracking down responsible parties, with many blocks built by special purpose vehicles (SPVs) which were immediately dissolved when blocks were sold. Many buildings are now owned by opaque investment funds which take no responsibility for construction standards.

“The SPVs will have a parent company who we can go after,” said Mr Day. “There is clear European Human Rights case law on that point.”

The Polluter Pays proposal comes as a group of backbench Conservative MPs, led by Stephen McPartland and Royston Smith, seek support for a separate amendment which would prevent costs being passed on to leaseholders.

Giles Grover, a spokesperson for the End Our Cladding Scandal campaign, said the proposals from Mr Day and Mr Greenberg were “welcome” and that “finally and fairly protecting leaseholders” was “long overdue”.

However, he added that even if the measure was adopted, protections would still be needed to prevent bills being passed on to leaseholders in any instances where the polluter pays principle could not recover the cost.

“It is vital that amendments to prevent leaseholders from picking up the tab for this collective state and industry failure pass, and we would still need the support of MPs of all parties, but particularly the Conservatives, to ensure they do,” he said.