Who should pay the UK’s housing repair bill?

“After the Grenfell fire: who should pay the UK’s housing repair bill?”, Jonathan Ford, Financial Times, 30 March 2021.

The cost to make buildings safe can only yet be guessed at, but research by a parliamentary select committee suggested that it might run to more than £15bn. Under pressure from its own backbench MPs, the government has tried to appease angry homeowners. Last month, Robert Jenrick, the housing secretary, announced £3.6bn of extra cash for its Buildings Safety Fund to strip flammable cladding from buildings more than 18 metres high, taking the total to £5.1bn. Those in lower buildings could be offered long-term loans to make repairs with monthly payments capped at £50. Part of the extra money will come from a tax on the building industry designed to bring in £2bn over 10 years. A levy on high buildings has also been proposed.

Yet campaigners have decried these plans as unfair for leaving much of the burden on owners. “If you bought a car and all its wheels fell off, would you really expect to have to pay to put the problem right?” says Dean Buckner of the Leasehold Knowledge Partnership, a body that campaigns for flat residents. “It’s those who caused the problem — and that’s in great part the industry — who should be made to pay.”

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The Leasehold Knowledge Partnership has now devised its own solution. It would replace the loan scheme with a levy on developers, landlords and manufacturers to raise a fund sufficient to bankroll the cost of remediation, including non-cladding defects, beyond the proposed government grants. It would include a 1-2 per cent levy on all new-build properties over the next 10 years. “Firms need a clear message that if they are part of an industry that created this problem, then they need to take ownership of it,” says Dean Buckner of the LKP.