Michael Gove, the housing secretary, has set out new measures that include targeting companies that manufactured defective cladding, which could see them picking up a large portion of the £9bn bill to resolve the long-running building-safety crisis in England.
On Monday, Gove put forward a series of proposals that would force cladding companies and housebuilders to pick up the tab for historic defects, putting substance on the hardline rhetoric he has used towards the industry in recent weeks and crystallising a pledge to protect leaseholders from the costs of the crisis.
Among the proposals is a rule enabling building owners and landlords to take legal action against manufacturers who supplied defective materials for any home built in the last 30 years that has since been declared unfit to live in.
That would potentially put cladding companies on the hook for the cost of any repairs linked to their materials, even where those have already been paid for by the landlord or leaseholders.
Gove has also proposed expanding the powers of a new product regulator. Any manufacturer found to have breached regulations will face a “cost contribution order”, forcing them to pay towards fixing any building that has used that product.
The proposals would legally protect leaseholders in any building higher than 11m — which are those deemed at the highest risk of a deadly fire — from paying anything towards remedial work. And they would prevent developers from setting up shell companies to oversee individual blocks in order to avoid future liability.
They will be added to the Building Safety Bill, which is scheduled to pass into law within the next few months.
“These measures will stop building owners passing all costs on to leaseholders and make sure any repairs are proportionate and necessary for their safety . . . All industry must play a part, instead of continuing to profit whilst hardworking families struggle,” said Gove.
Last month, the housing secretary said he expected industry to fork out an additional £4bn to fix blocks between 11m-18m in height, on top of £2bn being raised through a levy as part of an estimated £5.1bn bill for fixing taller buildings.
He has also threatened to freeze rogue developers out of housing funds and the planning system.
“We cannot allow those who do not take building safety seriously to build homes in the future, and for those not willing to play their part they must face consequences,” he said on Monday.
The announcement was welcomed by leaseholder groups who have campaigned against costs falling to blameless residents.
“Today’s announcement is the most positive step forward we have yet seen in the building safety crisis. Finally, nearly five long years after the Grenfell tragedy, the penny seems to have dropped with the government that leaseholders are the innocent party and that the polluters who caused this crisis must be the ones to pay to fix it,” said campaign group End Our Cladding Scandal.
But the group said there was still work to be done. According to Monday’s proposals, where a building’s owner cannot pay, leaseholders may still be on the hook for costs of up to £10,000, or £15,000 in London, a measure EOCS said was unfair.
The Home Builders Federation, an industry body, said it was committed to working with the government on a solution to the crisis and that it “remains fully committed to the principle that leaseholders should not have to pay for necessary remediation costs”.