Home builders will pay £ 5bn to rectify faults in newly built homes

Home builders will pay £ 5bn to free tenants caught in the lining scandal that erupted after the 2017 Grenfell fire.

Under a new agreement drawn up by Housing Minister Michael Gove, home builders will pay a total of at least £ 2bn to repair fire safety problems in their own buildings and will contribute £ 3 billion by extending the tax to new homes.

So far 35 of the 53 greatest British builders they have committed themselves to fixing problems in all buildings higher than 11 meters and in which they have played a role in development over the last 30 years.

They will pay £ 2bn to fix problems in their blocks and recoup all the taxpayer cash so far spent on the work, through government subsidies such as the Building Security Fund.

House builders will then also contribute £ 3bn over a 10-year period with tax on all new apartment buildings in England.

Previously, this building security levy was levied only on new high-rise buildings. Under initial conditions, it is expected to raise £ 2 billion in 10 years.

The money from the building security tax will be used to repair cladding on buildings 11 to 18 meters high, where the responsible person cannot be identified or acted upon by law.

This money will be in addition to the £ 5.1 billion building safety fund – a pot of state funding to cover the cost of renovating the cladding for blocks higher than 18 meters that do not have a responsible builder.

However, there is still the issue of financing the work without lining the so-called “orphan” blocks.where the developer no longer exists.

Martin Boyd of the charity Leasehold Knowledge Partnership said: “We will be watching to see if the government announces protection for these blocs soon. If not, these are the buildings at the bottom of the government waterfall of restoration protections. It would be very disappointing if those at the very bottom of the waterfall were the only ones left without a lifeboat. “

Gove noted that builders who did not sign up for the promise will be blocked from planning and government funding. He said: “I welcome the move of many of the biggest developers to do the right thing. But this is just the beginning. We will do whatever it takes to hold the industry accountable and, in line with our new measures, there will be nowhere to hide. “

Liam Spender of End Our Cladding Scandal said: “Today’s agreement requires intense scrutiny by the government. If that doesn’t happen, then this agreement will not work.

“Until the buildings are repaired, people will still pay for waking hours and higher insurance premiums. That’s money they won’t get back with today’s announcement. “

The government has also told lining and insulation manufacturers that they need to take their share of responsibility for the crisis and make a proposal on how to contribute to the costs.

Laws proposed in February will protect tenants from paying for any linings-related faults. Non-cladding repair repair costs will be limited in cases where the responsible party cannot be identified.

All tenants are eligible for this protection at their main residenceif they live in the affected property. But protection does not apply investors with large portfolios. If tenants owner of more than three propertiesthey will not be protected except for their main residence.