Leaseholders at a Manchester block who accepted huge loans to fund the removal of their dangerous cladding have said they are “heartbroken” over their exclusion from a government fund.
Residents of Skyline Central 1, which has combustible high-pressure laminate (HPL) cladding, accepted loans of up to £25,000 each in January to pay for the work – after being set an ultimatum which could have seen them lose their homes.
The cladding replacement work then began and is now nearing completion, but the cost of the loans has pushed some residents to the verge of bankruptcy.
They had hoped to recoup their costs through the £1bn Building Safety Fund – which covers materials such as HPL – but the prospectus released on Monday reveals buildings will be excluded from applying if work has already started.
A government spokesperson said the fund was targeted “at removing the financial barriers that are preventing building owners from remediating unsafe buildings quickly”. The spokesperson added that “there may be recourse through building owners through warranty or insurance claims” for leaseholders who have already paid.
However, a leaseholder at Skyline told Inside Housing this route had already been explored with the freeholder and an independent lawyer and was not available because the building was out of warranty. They said it was "truly baffling" that the government believed this would be possible.
The leaseholder added: “We’re extremely concerned to notice that the fund only seems applicable to remedial work that hasn’t started yet.
“While the work on replacing our HPL cladding and other fire safety defects is nearing completion, the financial burden that this brings will last a lifetime, with many of us now facing the very real possibility of bankruptcy. It seems completely abhorrent that the government has chosen to ignore leaseholders like ourselves and make us ineligible to apply to the fund.
“They have always said that work must be carried out as soon as possible and that leaseholders should not be responsible for the cost of remedial works, and yet it looks like we still are. All these terms and conditions do is penalise those living in buildings where the freeholder has already acted.
“It is truly heart breaking and we’d like urgent clarification on why government have chosen to leave us out of what, now more than ever, seems to be a cladding lottery.”
They had previously called on housing secretary Robert Jenrick to act to protect them from the costs.
Could I trouble you to email me on email@example.com— Robert Jenrick (@RobertJenrick)
Best wishes Robert
Could I trouble you to email me on firstname.lastname@example.org— Robert Jenrick (@RobertJenrick) July 25, 2019
Best wishes Robert
A spokesperson for HomeGround, which acts for building owner Adriatic Land, said it supported the residents’ call.
“We fully support the leaseholders in this matter,” a spokesperson said.
“The government has already acknowledged the regulatory failure that has caused this cladding crisis so it is not right that the Skyline leaseholders are being denied support from the government’s remediation fund. It is especially unfair in the case of Skyline that leaseholders are being penalised as a result of the proactive work that has taken place to remediate the building as quickly as possible. Had funding from government been made available earlier, this would not have happened.”
The Building Safety Fund offers £1bn of public money to remove HPL and other forms of dangerous cladding from high rises.
An estimated 1,700 buildings will need this work, but the fund will provide less than a third of the estimated cost – leaving leaseholders in buildings which miss out potentially facing the huge bills for remediation. The fund will be allocated on a first come, first served basis.
It follows £600m allocated for the removal of aluminium composite material cladding, as used on Grenfell Tower.
A spokesperson for the Ministry of Housing, Communities and Local Government added: “We’re determined to keep residents safe – that’s why this week we’ve published details of our £1bn fund to remove unsafe cladding from buildings and ensure this happens quickly.
“We expect building owners to take immediate action to make their buildings safe and we have reached an agreement with local leaders so that this important work can continue safely during the pandemic.”