Michael Gove has laid out his plans to rethink the government's current approach to the cladding crisis, scrapping current advice on low rise buildings and pausing plans for loan schemes.
The secretary of state for levelling up, housing and communities told MPs yesterday (November 8) he intends to withdraw a government consolidated advice note on low-rise buildings with cladding “before Christmas”.
Lenders have been waiting for the government to withdraw this note since it was published in January 2020. It called for building owners to check cladding systems on all blocks of flats, regardless of their height.
In July, the government declared there was "no systemic risk of fire" to blocks of flats under 18 meters. But the consolidated advice note was not revoked, which has meant lenders' risk appetites have remained largely unchanged.
In a meeting with the Housing, Communities and Local Government Committee, Gove also said he intends to “pause” government plans for leaseholders in low-rise buildings to enter into loan schemes, as his department continues to weigh up other options.
The loan schemes were designed to ensure leaseholders pay no more than £50 a month for cladding remediation, but details of the schemes are yet to be announced.
Asked when the government will announce them, Gove told the committee: “Can we just pause and see if this is a necessary way of dealing with it?
“Because I am still unhappy with leaseholders having to pay it all, no matter how effective a scheme might be in capping their costs.” He concluded: “Why do they have to pay at all?”
Currently, thousands of leaseholders are stuck in unmortgageable homes due to the cladding on them. Those in buildings between 11 and 18 meters, who are not eligible for government funding, are facing bills to the tune of tens of thousands of pounds to remove cladding, as lenders refuse to lend on flats which could bankrupt their owners.
Gove told the committee he wanted to justify a “polluter pays” approach, alluding to a Building Safety Bill amendment currently being mulled over by government which would see developers pick up the bill facing leaseholders.
FTAdviser understands leasehold campaigners behind the amendment will be conversing with Gove’s department as soon as next week.
The secretary of state admitted the government was “not dealing fast enough with some of the big issues” posed by the cladding crisis. “We collectively - the department, some in local government, others in the private sector - failed people by Grenfell," he said.
Gove also admitted the government has not been getting “the right response” from some in the private sector, and that “there are leaseholders who are being unfairly penalised”.
On how his department will characterise ‘risk’ posed to buildings with cladding going forward, Gove said: “There are some buildings where the real level of risk is less than had been feared.”
He went on to admit the current assessment that has been made of what is required in order to provide reassurance to lenders has seen leaseholders face “an excessive burden”. As a result, the secretary of state said he intends to shed greater clarity on what is “high” and “low risk”.