Government says ‘not a penny’ of new remediation unit will be passed on to leaseholders

An MHCLG spokesperson has now confirmed to Inside Housing that “not a single penny of the cost of the REU is passed onto leaseholders”.

MHCLG highlighted Section 20F of the Landlord and Tenant Act 1985, which sets out that any costs incurred solely as a result of a penalty imposed or enforcement action taken by the BSR cannot be passed to leaseholders through service charges.

However, End Our Cladding Scandal (EOCS) has pointed out that certain measures and costs can still be billed to leaseholders under Section 30 of the act. If an enforcement notice determines mitigation is needed, such as a waking watch patrol, these measures can be passed on.

The government also believes that all leaseholders in relevant buildings are protected from non-cladding fire or structural remediation costs on their principal home under the leaseholder protections set out in the Building Safety Act.

Plus, any cladding remediation work is covered by grant funding schemes like the Cladding Safety Scheme, or through developers who have signed the government’s post-Grenfell building safety remediation contract.

This remediation contract, first published in January 2023, commits developers to pay for “life-critical fire safety” remediation work on blocks they built that are taller than 11 metres regardless of whether they still own them.

But Inside Housing reported earlier this year how leaseholders in a Manchester block are still facing a bill of tens of thousands of pounds due to gaps in funding for a waking watch patrol.

Leaseholders at Zinc Court, Radius Apartments in Prestwich have been hit with a bill of more than £67,000 for a waking watch, even though the developer signed up to the government’s contract.

An EOCS spokesperson said: “After the debacle of costs for compliance relating to the BSR regime being marketed by government and the HSE as a cost to industry, when leaseholders were, and still are, clearly on the hook, it is a step forward to see that lessons have been learnt and leaseholders will not be forced to pay for the Remediation Enforcement Unit itself. 

“However, as always, questions remain, particularly in terms of what enforcement will actually look like on the ground and the harm this will cause leaseholders and residents. In recent years, we have seen an increasing number of buildings where enforcement has led directly to people being kicked out of their homes, or their being forced to pay thousands of pounds for a waking watch to avoid this.

“The focus on cladding and only life-critical safety risks remains a huge concern and there is still little consideration of resident-managed buildings, where remediation is often reliant on a developer and/or freeholder. 

“It is also unclear how buildings below 18 metres will be made safe if the BSR remains focused on a subset of the thousands of unsafe buildings across the country. Sadly, the piecemeal approach to people being and feeling safe in their homes looks set to continue.”

Building owners that do not meet the government’s new target for removing unsafe cladding could face unlimited fines or imprisonment.

In July, the government set strict deadlines as part of its Remediation Acceleration Plan, which will include new legislation that will be brought forward as soon as the parliamentary timetable allows.

However, EOCS and other industry figures told Inside Housing last month about their concerns about capacity and a perceived lack of focus on non-cladding defects.