Clause 57 - Levy on applications for building control approval in respect of higher-risk buildings

Part of Building Safety Bill – in a Public Bill Committee at 3:15 pm on 23 September 2021.

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Photo of Rachel Hopkins Rachel Hopkins Labour, Luton South 3:15, 23 September 2021

It is appropriate that I mention my entry in the Register of Members’ Financial Interests; I am a vice-president of the Local Government Association.

I welcome the opportunity to move this amendment. The Minister will recognise my deep interest in housing and in ensuring that everyone can live in a good-quality, secure, safe home that they can afford to live in. The amendment would place in the Bill, rather than in regulations, an exemption for social housing from the levy introduced by the clause.

The levy is designed to meet building safety expenditure. That expenditure is not the ongoing cost of the new building safety regime, which is met through the building safety charge; it is designed to cover the cost of Government support for the remediation of unsafe cladding. That support is provided to leaseholders in buildings with unsafe cladding systems, either through the Building Safety Fund or through a system of low-cost loans for buildings under 18 metres, the details of which are yet to be announced.

For the most part, that support is not available to social landlords, other than to alleviate costs that they may otherwise have to pass on to leaseholders. With the exception of buildings with aluminium composite material cladding, social landlords have been denied access to those funds. For councils, remediation costs therefore fall on the housing revenue account and must be recouped either through rent increases or by diverting funds away from improvements to council housing or the provision of new council housing.

In contrast to many private developers and freeholders, social and council housing providers were the quickest to react post Grenfell. Analysis has shown that housing associations have paid six times more than developers to remediate dangerous cladding. According to G15, the group of London’s largest housing associations, overall, associations have set aside nearly £3 billion for historical remediation costs, far more than the half a billion pounds that the private sector has provided.