The following Acts were given Royal Assent:
Counter-Terrorism and Sentencing Act,
Air Traffic Management and Unmanned Aircraft Act,
Non-Domestic Rating (Public Lavatories) Act,
Forensic Science Regulator Act,
British Library Board (Power to Borrow) Act,
Education and Training (Welfare of Children) Act,
Domestic Abuse Act,
Prisons (Substance Testing) Act,
Botulinum Toxin and Cosmetic Fillers (Children) Act,
Education (Guidance about Costs of School Uniforms) Act,
Animal Welfare (Sentencing) Act,
Financial Services Act,
Overseas Operations (Service Personnel and Veterans) Act,
Fire Safety Act,
National Security and Investment Act.
The following Measures were given Royal Assent:
Diocesan Boards of Education Measure,
4M: Because the issue of remediation costs is too complex to be dealt with in the manner proposed.
My Lords, I express my thanks once again to everyone for their contributions to this important debate. The other place has now consistently voted against four different amendments on the issue of remediation. It is a vital issue but it is not for this Bill. This House has a choice about whether to prioritise finalising this important Bill or to delay it to the point where it falls.
The Government’s position on the Fire Safety Bill has not changed. I will repeat our key points. We are all in agreement about the importance of getting the Fire Safety Bill on the statute book. Residents have a right to be safe and feel safe in their homes. As I have said repeatedly, without this Bill the legal ambiguity around the fire safety order will continue.
Let me be clear about what is at stake if we do not resolve this: responsible persons for multi-occupied residential buildings will be able to continue to argue that it is lawful to ignore the fire safety risk of the structure, external walls and flat entrance doors; and fire and rescue services will lack the legal certainty to support enforcement decisions taken to keep people safe.
Failure to get this Bill to the statute book will lead to a delay in delivering the Grenfell recommendations. This is not a political point. This Bill must come first as it provides the legal certainty that I have just referred to. That certainty will enable the Secretary of State to make regulations with reduced risk of challenge to place duties on responsible persons in relation to the external wall structure and flat entrance doors, as the inquiry recommended.
It might help the House if I provided an example. The inquiry recommended a frequency of checks on fire safety doors, including flat entrance doors and communal fire doors. That cannot be done easily and in a way that is relatively free from legal risk if we have not identified that flat entrance doors are within the scope of the fire safety order. Equally, enforcing authorities would not be able to take appropriate action in this regard.
I thank your Lordships for recognising the substantial government support—to the tune of £5.1 billion—for leaseholders for remediation of unsafe cladding. Our five-point plan to bring an end to this cladding crisis helps provide certainty to the housing market. Noble Lords yesterday raised some points about uncertainty in the housing market and about the concerns of lenders and insurers. Our five-point plan addresses these.
More needs to be done to ensure that those responsible for fire safety defects should contribute to paying the costs of remediation. Industry must play its part and pay its way, and through our high-rise levy and developer tax we will make sure that developers with the broadest shoulders pay their contribution.
I agree that leaseholders need stronger avenues for redress and I made that clear yesterday. The building safety Bill will bring forward measures to do this, including making directors as well as companies liable for prosecution. We are bringing about the biggest changes in a generation to the system through the building safety Bill.
Finally, I reiterate the comments I made yesterday about forfeiture. It is a draconian measure that should be used only as a last resort. This measure should be considered as part of our wider programme on leasehold reform. I beg to move.
Motion A1 (as an amendment to Motion A)
My Lords, I first draw the attention of the House to my relevant interests as a vice-president of the Local Government Association, a non-executive director of MHS Homes Ltd and chair of the Heart of Medway Housing Association.
It is disappointing and frankly outrageous that the Government are doing nothing and not delivering on their promises to the innocent victims of the cladding scandal. The noble Lord, Lord Greenhalgh, has gone through various points. He said that the other place had consistently voted against our amendments. That is a matter of much personal regret. Most Members of the governing party do not seem to recognise the plight of the innocent victims in this scandal.
What also irritates me about this issue is the point made by my noble friend Lord Adonis. The Government are now saying, “Well, of course, the Session finishes tomorrow and we need to get the Bill on the books”. The fact is that the Government, when the House of Commons rejected our amendments some weeks ago, left them sitting there and did not bring them here. They could have done so and I do not know whether that was deliberate or incompetent. The fact is that the amendments just sat there and were not brought here. For the Government then to claim, “We cannot go any further because of where we are” is irritating, to say the least.
It is fair to say that one could never accuse this Government of acting in haste when it comes to the Grenfell Tower inquiry recommendations. This is the first piece of legislation since the fire happened four years ago this summer. The Government have not acted in haste at all. The noble Lord, Lord Greenhalgh, is right: I want to see the people who built defective buildings and put cladding on improperly pay. I do not want to see the innocent victims pay. I also want the companies that provided insurance honour it. They were clearly happy to provide the insurance and they should pay up. I also want to see the professionals who signed the buildings off and who pay for their professional indemnity insurance, come forward, recognise and be held to account for what they have done.
It is even more outrageous when one considers what our Prime Minister—the Prime Minister of the United Kingdom—been saying for the past 18 months. I shall remind the House of one or two of his quotes—not all because there are loads of them. There are many examples and I suggest that noble Lords, particularly those on the Government Benches, would do well to reflect on some of those comments, read what he said, think about them and consider what they will do in terms of the how they are being whipped to vote. The PM said on 30 October 2019:
“I know that progress is not as fast I should like, but I am pleased to say that all such buildings owned by central and local government have now had their cladding removed, are undergoing work to remove it, or, at the very least, have such work scheduled. In the private sector, progress is slower, and too many building owners have not acted responsibly.”—[Official Report, Commons, 30/10/19; col. 379.]
He also said:
“My hon. Friend is absolutely right to draw attention to this injustice and what is happening with leaseholders at the moment. That is why we have put £1.6 billion into removing unsafe cladding. I do not want to see leaseholders being forced to pay for the remediation, and I can assure my hon. Friend that we are looking now urgently—before the expiry of the current arrangements—at what we can do to take them forward and support leaseholders, who are in a very unfair position.”—[Official Report, Commons, 9/12/20; col. 842.]
That was the Prime Minister on 9 December 2020. He subsequently said:
“We are determined that no leaseholder should have to pay for the unaffordable costs of fixing safety defects that they did not cause and are no fault of their own.”—[Official Report, Commons, 3/2/21; col. 945.]
Everyone would agree with that. That was the reply of the Prime Minister to the Leader of the Opposition on 3 February this year. That is just three quotes but there are many others that noble Lords should look at. Those are the quotes but we then come back to the reality of where we are, which is something different, is it not? It goes on and on.
What is shocking for me is that whenever the Government are provided with the means, through the Fire Safety Bill, to do what they promised—what the Prime Minister promised—they vote against it. We get excuse after excuse after excuse from the noble Lord, Lord Greenhalgh, or at the other end about why the Prime Minister cannot do this and why the Government cannot deliver on their promises.
Frankly, some of these excuses are feeble. “It’s not the right Bill” is regularly trotted out. I have been in this House for 11 years and have seen some absolutely dreadful Bills from the Government. Look at the dreaded Housing and Planning Act: appalling legislation, poorly put together on the back of a cigarette packet and pushed forward by then Prime Minister David Cameron, only to be dumped virtually completely by Theresa May when she assumed office. Or the useless Fixed-term Parliaments Act that proved totally pointless and delivered nothing. Or the ridiculous decision not to go for higher building standards to make homes carbon-neutral, only to completely reverse the position a couple of years later and actually want to do that. Or the rogue landlords database that the Government repeatedly refused to let the public have access to, only then to change their mind but say, “We’re really sorry but we can’t find the time to actually make the change.”
I fully respect the conventions of this House and the primacy of the other place, but that does not prevent us keeping on raising this scandal and speaking up for the innocent victims—the people who play by the rules, pay their taxes, pay their council tax, go to work, work hard and expect better from their Government. They are not getting that today.
This issue will not go away. In this House and the other place we will confront the Government with the reality of their absurd position. With the victims of this scandal, we will force the Government to honour their promises and pledges. People in this country have had their eyes opened to the actions of the Prime Minister and his Government, and they are not going to be fooled by all the pledges, promises and desire to do things when they actually do nothing. Yes, we have finally found them out. The country has found them out. I beg to move.
My Lords, I remind the House of my interests as a vice-president of the Local Government Association and a member of Kirklees Council.
Throughout the course of this Bill, I have said that I support its contents and purpose. I cannot support the unintended consequences that will have a devastating impact on individual leaseholders and a very damaging effect on the housing market. Those are the reasons for my asking again for the Government to take responsibility for the consequences of this Bill, which despite the Minister’s best efforts has been totally underwhelming so far. Promises have been made by the Government and not kept.
The Government’s response to date is to provide grant funding of £5 billion while knowing that the total cost is estimated at £16 billion. The grant includes only blocks over 18 metres and only removes the flammable cladding. For those in lower blocks, there is the prospect of paying up to £50 per month for years to come.
Conveniently, the Government fail to take into account the non-cladding issues that are a result of construction failure of immense proportions. These non-cladding issues are the ones that will finally push individuals over the edge. Meanwhile, those who have literally built this catastrophe walk away with their billions of profit. The Government have a duty to protect their citizens—it is their prime duty—yet here we are today with perhaps a million of our fellow citizens being thrown to the ravages of financial bankruptcy, and the Government wash their hands and look the other way.
The Government will argue that the Bill is a vital response to the Grenfell tragedy. It is so vital that it has taken four years to get to the statute book. The Bill’s purpose is to include external walls, doors and balconies in the fire safety order of 2005, so that action is taken to protect people from another Grenfell tragedy. However, a Bill is not now needed to force action to remove cladding; that is happening. It is not needed to get fire alarms put in; that is happening. Those who own the buildings, and those who are leaseholders and tenants, already know that action has to be taken to make their buildings safe. It is no longer urgently necessary to get legislation to force the issue and it is no longer possible to force construction firms to take the necessary action; there is not capacity to do so. If, though, the Bill does fall, this provides a breathing space for the Government to develop a package of further measures that will protect the interests of leaseholders and save them from penury.
The amendment in my name seeks to achieve that breathing space. It is based on the original one in the name of the right reverend Prelate the Bishop of St Albans and has been adjusted to include the various very valid points that have been made during the passage of the Bill. We must all recognise that passing this Bill will not magic away the crisis that individual leaseholders are facing. It will not remedy the construction scandal. It will not provide stability for a foundering housing market. It will be the beginning of a scandal of individual bankruptcies, homelessness, intense stress and mental illness. It will become a public scandal and I for one will at least have on my conscience that I have done all in my power to prevent it. Leaseholders have done everything right and nothing wrong. Liberal Democrats will stand by them. I give notice that I wish to test the opinion of the House on the amendment in my name.
My Lords, as we seem to be in the last chance saloon, I will try not to repeat myself too much, but declare my interests as both a property professional and a vice-president of the LGA. As I said yesterday, the House seems to be presented by the Government with a choice. On the one hand is the evident desirability of implementing fire safety measures in pursuance of the valuable recommendations in the report by Dame Judith Hackitt into the Grenfell tragedy, plus a partial solution to some of the effects of cladding replacement on a limited class of taller buildings, as we have heard. On the other is what I am afraid I must describe as the effective hanging out to dry of hundreds of thousands, if not millions, of other home owners. It should not be a question of either/or in dealing with a growing and pressing social and economic disaster. I too support improved fire safety, but not on the basis of creating further untold, and probably unquantified, problems.
Yesterday, the Minister endeavoured to persuade us by saying that this brief and simple Bill merely clarified the Regulatory Reform (Fire Safety) Order 2005. I am afraid to say that, on my own rereading of that, he is plainly mistaken. This Bill amends the scope of the fire safety order by inserting an exception to paragraph 1a, referring in turn to two newly inserted paragraphs, 1A and 1B, that substantially expand the scope of the order. The fact that anything was attached to the named elements means the Bill has far wider implications than might be supposed. So I am afraid to say that the Minister’s assertion really did it for me. I felt it was misleading and what my late father would have described as an exercise in intellectual sharp practice. My distinct impression is that I am being taken for some sort of fool. The indisputable fact that must be regarded as plain is that this Bill makes the changes that by direct chain of causation have created the issues and caused the results that the noble Baroness, Lady Pinnock, and the noble Lord, Lord Kennedy, seek to resolve.
Another issue appears to be one of definition. The Government are concerned that any scheme that might be put in place could be used to avoid regular maintenance and routine upgrades. The amendment of the noble Baroness, Lady Pinnock, in particular, seeks to address that. In my experience there may be grey areas, but I do not have any difficulty in my work in distinguishing repairs and the like, or like-for-like replacements, from those items that are improvements. Nor do most leaseholders and property owners.
Let us be clear—and here I take a cue from the noble Lord, Lord Kennedy, for a bit of historical background—that it was on the watch of a Conservative Government that the 1984 Building Act brought in the approved inspector regime and the effective privatisation of the regulatory oversight of construction quality, previously exercised by local authority building control. Despite indicators of shortcomings and shortcutting, this process continued, without adequate checks on who was doing the inspection of the works, or how good the oversight was in practice. It is on the basis of the subsequent 37 years of construction and its legacy of known and unknown deficiencies, scattered randomly about the nation’s housing stock, that modern housebuilding, construction warranties, lending and home ownership have been founded.
If the Government consider that they need to take steps to protect the valiant and much-abused postmasters from system failure, how can they, with it any cogency or conscience, make a distinction concerning a far greater number of home owners who are affected at least as severely? So, while I note that the Minister in the other place this afternoon sought to point the finger at the unelected Lords blocking the democratic decision of the Commons, I simply say that the exercise of raw political power vis-à-vis the party whip to procure a majority in the Lobby does not endow the Government with a moral superiority, or indeed the social advancement of justice and ethical treatment of citizens. I note the reasons for rejecting our amendments, which simply translate as “too difficult”. I suspect not half as difficult as picking up the bits after this has rolled itself out.
At one point I believed the Government had it hand to corral all the potential damage, but I believe they have not done so. It would not concern me if this Bill fell, so unreasonable do I believe its true effects to be, and so lacking is the willingness of the Government to deal with it. What it has proposed will roll out far too slowly: eight months to do the highest-risk buildings, and how much longer to deal with the far greater number in future stages? What about capacity in terms of manpower, training and so on?
I took note of the comments from the noble Lord, Lord Cormack, but I find that sitting on my hands, signifying my acceptance of the Government’s position here, does not sit comfortably with my conscience—knowing, as I do from professional experience, just what harm the Bill is likely to do, alongside its undoubted good.
I suspect that the Bill will ultimately pass into law, even if the Parliament Act has to be invoked—but I am afraid I cannot agree to it as it stands. I fear that Lobby fatigue may mean that this is the end of the matter for now. Either way, I shall return to this subject in the new Session—as, doubtless, will the noble Lord, Lord Kennedy, and the noble Baroness, Lady Pinnock. Meanwhile, I have absolutely no hesitation in supporting the thrust of the amendments—any one of them, whichever might gain approval. And I hope I will sleep with my conscience clear as a result.
My Lords, the following Members in the Chamber have indicated that they wish to speak: the noble Baroness, Lady Fox of Buckley, the right reverend Prelate the Bishop of Rochester and the noble Lord, Lord Newby. I call first the noble Baroness, Lady Fox.
I remind the House of my interests: I am a leaseholder. Like the noble Lord, Lord Kennedy, I heard Boris Johnson telling Parliament in February that
“no leaseholder should have to pay for the unaffordable costs of fixing safety defects that they did not cause and are no fault of their own.”—[Official Report, Commons, 3/2/21; col. 945.]
To be honest, I cheered. Maybe I was being naive, but I sort of took him at his word—and I sort of still do. But can I? Has anyone briefed the Prime Minister on how his promise to leaseholders is being broken by his own Government as we speak?
In the other place the Minister, Chris Pincher, said that the amendments lacked clarity and prohibited minor costs from being passed on to leaseholders. That was so disingenuous. This is not a load of whiny leaseholders whingeing about minor costs. People are utterly desperate. As we have heard from other noble Lords, this Bill almost guarantees that major costs will be passed on to them—unless the Minister thinks that remediation costs of up to tens of thousands of pounds each, or 400% hikes in service charges, are minor. Those are not minor in my world, nor in the world of so many leaseholders who, as I have stressed here before, bought into that nirvana of home-owning democracy. They were often first-time buyers, who became leaseholders as part of affordable housing schemes.
The Minister in the other place said that the amendment would not help leaseholders. But leaseholders do not feel that way. What they do feel is exasperated. They have been told about the loans scheme, and that this issue can be sorted out by the passage of the building safety Bill. Even then, if there were an assurance from the Government that they would prioritise that Bill as an urgent piece of legislation at the start of the next Session, it might be some consolation. But of course, we do not know when it will appear.
As one group of leaseholders noted in an email to me, the reality is that they are accruing costs now. They are not allowed to postpone paying them until a new parliamentary Session. They cannot say, “Sorry, won’t pay until the building safety Bill’s got through.” They fear that by the time that legislation is passed, many of them will already have lost their homes—and, as one said, “I will certainly have lost my mind.”
Earlier today I heard a Minister here justify imposing a set of regulations on the Northern Ireland Assembly, although that would undermine the devolution agreement. He justified that decision because he said that the Government had a duty to ensure that women’s rights were addressed, and legal abortion services were made available. I was anxious at this procedural and technical fix to solve a complex constitutional and moral problem. But now, if only the Government would come up with some procedural and technical fix to solve what is undoubtedly a complex problem, but one, in this instance, of leaseholders’ rights. There seems to be a sort of stubbornness, which is so unbecoming—a kind of evasiveness, which is kicking this problem down the road, where it will get worse, and letting the most blameless take the hit in the meantime.
I have a lot of respect for the Minister, but I feel as though the Government must know in their heart of hearts—with Tory rebels in the other place, noble Lords from all sides of this House and all the devastating personal testimonies we have shared over the last few days—that what is being asked for here is modest. We are asking for any mechanism, however technical, or any scheme that would actually help leaseholders and save them from bankruptcies now, as is so urgently needed.
We have heard about the £5 billion scheme, and we have all welcomed it, but it really applies only to those in buildings over 18 metres. Leaseholders in buildings of 17 metres or 15 metres are still being asked to pay sky-high costs. As we have heard, it is estimated that the £5 billion scheme still leaves at least £10 billion unaccounted for, and maybe more.
I want to test whether the Government are true to their word—true to the Prime Minister’s word that I started with—and ask the Minister a simple question. If this Fire Safety Bill were to pass, what will the Government do in the interim between its passing and the building safety Bill to stop leaseholders’ bankruptcies and the negative equity crisis that this Bill undoubtedly helps to create?
Finally, I take this opportunity to say to the leaseholders: you have allies in the other place and here who will continue to stand up for you and keep raising awareness of your plight. I am still hopeful that the Minister and the Prime Minister might be among those allies too.
My Lords, the right reverend Prelates the Bishop of St Albans and the Bishop of London have both been involved in earlier stages on the Bill and, regretfully, neither is able to be in your Lordships’ House this evening. However, I come with my own background and interests, as a former board member of various housing associations over 25 years and as the former chair of the charity Housing Justice.
As noted by the noble Baroness, Lady Pinnock, the right reverend Prelate the Bishop of St Albans has been heavily involved in this matter and has been persistent. He said yesterday that none of us wanted to be in this position at this stage. But while so much of the Bill is welcome—not least the £5 billion which has been referred to—there are continuing and serious concerns, some of which have already been expressed in the debate this evening, about the position of leaseholders and tenants, and particularly certain groups of leaseholders and tenants.
Yes, remediation is a complex matter, but I am sure that it is not so complex that it cannot be worked out. I want to believe that Her Majesty’s Government are sincere in the express desire to protect leaseholders and tenants. The proposed amendments, including one here tonight, are designed to provide time for the Government to bring forward their own statutory scheme. It is the absence of clarity about that scheme and the timetable for it which is the cause of continuing regret on these Benches. Mention has been made already of the loan scheme in relation to buildings under 18 metres and the fact that that is likely to come forward in the context of another Bill. But, of course, that leaves open the questions of the detail and timescale and, as the noble Baroness, Lady Fox, has just observed, there are leaseholders facing those bills today.
We have heard many tragic stories of people with unpayable bills and crippling insurance and service charges. One concern of Members of these Benches is the effect of all that on people’s health and well-being, as well as on their financial capacity. These are important matters; they affect people’s daily lives, mental state and financial futures. While the Bill tackles a number of really important things, it leaves open some others which leave people facing uncertainty and potentially very significant liabilities.
Whatever happens this evening, I know that many in this place and elsewhere will continue to make the cause, because this issue will not go away. I dare to hope that if the Bill does pass this evening, Her Majesty’s Government will bring forward their proposals as soon as possible in the new Session to remove the uncertainty from those who are finding it really difficult to live with. These Benches continue to hold out hope for a more empathetic attitude towards leaseholders.
My Lords, I begin by declaring my interest as a leaseholder affected by fire safety remediation costs.
This afternoon, I decided to listen to the debate on the Bill in another place to see whether I had been missing something, by just hearing debates here, about the Government’s real reasons for not taking any appropriate action. Instead, I found that the key challenges that have been set out by noble Lords this evening were being made most eloquently by Conservative Back-Benchers. Bob Blackman made the key point that leaseholders have no luxury of time to deal with the demands dropping on their doormats today. Sir Robert Neill made the logical and consequential point that bridging provisions to fund remediation were needed, until the Government had put in place measures to recoup the costs from developers and builders—costs to be met, in the interim, by the Government. As a former Minister, he also made the telling point that the Government would have had time to produce their own amendments, if they had put their mind to it.
The response from the Government was from the right honourable Christopher Pincher, who replied with all the empathy and grace of a Victorian miller faced by workers’ demands to install expensive safety equipment on all the machinery. He also put the noble Lord, Lord Greenhalgh, to shame in his ability to ape Sir Humphrey. Unlike the noble Lord, who at least shows a certain lack of conviction in some of his adjectives, Christopher Pincher had none. In describing this amendment, as we have heard before, he mentioned the uncertainty that it would cause, the lack of clarity and the litigation that would flow, which would be voluminous. He had us almost in tears at the prospect of these terrible consequences.
There was not a word of explanation as to why, given that the Government allegedly want to do what is right, in the seven months since this Bill’s Second Reading they have made no progress whatsoever in bringing forward their own proposals to deal with the issues now. There was not a scintilla of a suggestion, from him, of when there would be certainty for leaseholders. He said that the building safety Bill would be brought forward as quickly as possible and that it would protect leaseholders “as far as possible”. Those two statements are of literally no comfort to somebody facing a bill today. We all know that those phrases “as far as possible” or “as quickly as possible” allow the Government to do whatever they want or not very much at all.
He also had the temerity to say that the Bill should now pass,
“so that people can get on with their lives.”
The one thing certain is that, if this Bill passes unamended, hundreds of thousands of people will not be able to get on with their lives, because overwhelming uncertainty will remain over their financial position and their ability, if they wish to do so, to sell the property in which they live.
The truth is that the Government have shown themselves indifferent to the mental and financial anguish faced by these people today, or else they would have made a meaningful commitment to the timetable for lifting the burden of costs and uncertainty from them. In these circumstances, how can we, in all conscience, pack up our tents now and let the Bill sail into the night? We on these Benches will not do so, and I urge Members across the House to vote for my noble friend’s amendment to bring tenants the relief that they so richly deserve.
My Lords, in Alice in Wonderland, Humpty Dumpty says:
“ ‘When I use a word, … it means just what I choose it to mean — neither more nor less.’ ‘The question is,’ said Alice, ‘whether you can make words mean so many different things.’ ‘The question is,’ said Humpty Dumpty, ‘which is to be master — that’s all.’ ”
That is exactly the position we find ourselves in today. It is an argument about the meaning of words, which the noble Lord, Lord Newby, in an excellent speech, has just pointed up. If one took the Government’s statements and sought to give the usual meaning to the words, then there would not be a problem here this evening.
I noted down what the noble Lord, Lord Greenhalgh, said in his opening remarks: these are just some of the statements he made. My writing is not fast enough to recite his whole speech, but if one took his whole speech, one would think there was no disagreement between us at all. “More needs to be done”, he said. “Industry must play its part and pay its way,” he said. “I agree that leaseholders need more protection,” he said. “Forfeiture,” he said—the fact we are talking about forfeiture is a sign of quite how serious a crisis we are facing—“is a draconian measure”; my writing was not fast enough here, but I think he said, “which is to be discouraged.” He also said, as the noble Lord, Lord Newby, just said, that these measures will be further addressed in the building safety Bill.
All those statements that the noble Lord made go to the heart of the protection we have been seeking to provide for all of those categories of people affected, not just those who live in buildings of more than 18 metres and not just those with costs directly attributable to cladding if they fall in the category of remediation costs which are essentially post Grenfell. This is the key point, because assessments that have been made about fire risks which are not just restricted to cladding are in the wider areas, some of which are in the expanded fire safety order which the Minister referred to.
The issue then is whether the scheme that the Government have said they will introduce to implement the principles that the Minister himself has set out to the House this evening is adequate to the task. We take the Minister at his word that it will be adequate to the task. There is some disagreement about how far it needs to be legislative and how far not legislative, though the fact that he constantly refers to the building safety Bill leads us to think that it will be substantially legislative. In so far as it is not legislative, these measures could be put in a legislative form, or he could make a categoric statement about when the Government will come forward with a comprehensive scheme.
So far, so good. What happens is that the right reverend Prelate the Bishop of St Albans and his understudy who is here this evening, if I may so describe him—anyway, he seems to be maintaining the line of the right reverend Prelate the Bishop of St Albans—and other noble Lords then consistently, on now about 10 occasions during the passage of the Bill, have come forward with proposals to put into legislative form what the Government themselves have told us they want to do. What happens, because we are now back in Alice in Wonderland, is that we pass amendments saying that remediation costs should not be passed on to leaseholders which are attributable to the additional costs which have come post Grenfell, and then the Government come along and say, “Ah, but this does not take account of the following five concerns.”
These are the concerns that the noble Baroness, Lady Fox, just mentioned about small costs, concerns about defining costs, concerns about costs which might be attributable to leases which applied and which tenants willingly engaged in before there were any additional costs put forward—we had a whole list of issues that were raised. What then happens is that the ever-receptive Bishop of St Albans, and other noble Lords change the amendments to take account of the Government’s concerns. Indeed, the amendment of the noble Baroness, Lady Pinnock, this evening meets most of the concerns that have been raised by Christopher Pincher in the House of Commons and by the noble Lord, Lord Greenhalgh, here.
It is worth dwelling on this, because these are hugely important issues potentially affecting millions of people, so we ought to be clear about it. Under the noble Baroness’s amendment, proposed new subsection (1) states:
“The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act”—
so defining clearly what should and should not apply. Proposed new subsection (2) states that the prohibition on remediation costs being passed on to tenants will have effect
“only until a statutory scheme is in operation which ensures that leaseholders and tenants of dwellings are not required to pay more than £50 per month during the course of the lease”,
but it does not apply to a cost that
“is permitted under a lease or tenancy agreement that was made before this Act is passed, and … does not exceed £500, whether as a one-off cost, or in total across a 12-month period.”
This meets the concerns that the Minister has raised, unless he does not propose to bring forward a scheme that meets his commitments in due course, which is the reason why we go round in circles again.
We then come out of Alice in Wonderland and into the real world. In the real world, we all know what is happening. It is not a secret to those of us who are politicians what arguments have now been happening for two months. Two things are happening. First, a battle royal is going on between the Minister’s department and the Treasury about what costs the Treasury will meet and how narrowly defined they need to be. The Treasury is already concerned about the size of the fire safety fund, the £5.1 billion fund which the Minister referred to, and whether the costs even under that scheme will end up being significantly higher. It certainly does not want more costs to be recognised. The second thing going on of which we are all well aware is that, although the Government say—because huge numbers of people are affected by this, many of them first-time buyers, many of them who have, under Conservative schemes, bought council properties and are leaseholders —that they want to see them fully protected, they do not at the moment either have a plan to fully protect them nor, to be blunt, do they want to protect them any more than they think is politically necessary to get this and subsequent legislation passed, presumably in the run-up to the next election, in a judgment they make on the salience of the issue.
We then come to the role of this House, which is unusual in this case. We had a lecture from the Chief Whip earlier about the supremacy of the House of Commons, which we all recognise, but the supremacy of the House of Commons is in this instance qualified in two respects. The Salisbury convention is clear that the supremacy of the House of Commons applies to all matters which the Government have placed in their manifesto. This House does not seek to cut across clear manifesto commitments which the Government have made when they want to realise them. The Government’s commitment at the election was to sort out this issue; it was not not to sort out this issue. If we take that reading of the role of this House, we will actually be implementing the Salisbury convention this evening if we pass the amendment of the noble Baroness, Lady Pinnock. We are seeking to hold the Government to their manifesto commitments to the people, not going against them.
The other reason why we are back in Alice in Wonderland in respect of the role of this House is that, when the Minister and the Chief Whip said this evening that the Bill will fail, it will fail only if, in response to the amendment being carried, the Government choose to let it fail rather than accept an amendment that puts into law the very commitments that they have said that they propose to meet.
We are in a conundrum as to what to do. If we vote for the amendment of the noble Baroness, Lady Pinnock, we be voting for something that will indeed send the measure back to the House of Commons and could, if the Government refused to give way, lead to the fall of the Bill. That is entirely in the hands of the Government. However, it is manifestly not the case that we are breaking the Salisbury convention, it is manifestly not the case that we are going against the commitments that the Government themselves have given, and it is manifestly not the case that we would be the cause of the Bill falling. The Government would be the cause of the Bill falling, because they were not prepared to accept the amendment.
We all have judgments to take as to how to vote, and I respect people who take different views on this issue, but it is very clear to me that this is not about the supremacy of the House of Commons. As the noble Earl, Lord Lytton, said, in what I have to say is the most impassioned speech I have heard him deliver to the House, this is a matter of the good faith of the Government and whether, when they say something, they mean it. If this House has any role to play, it is to see that high standards of conduct in public life are maintained, that Governments are held to commitments that they give and that the ordinary meaning of words should be taken to apply when they are uttered by Ministers.
My Lords, I will not trade Alice in Wonderland anecdotes with the noble Lord, Lord Adonis, but I take issue with the point made by the noble Lord, Lord Kennedy, and the noble Baroness, Lady Pinnock, that this Government and Prime Minister have done nothing or sat on their hands.
The reality is that I was appointed a Minister, a little over a year ago, into this role. The previous Government had first committed £400 million and then, very reluctantly, an additional £200 million towards the costs of remediating the same cladding that was on Grenfell Tower—aluminium composite material. In the month I was made a Minister, the Chancellor committed a further £1 billion. Now this Chancellor and Prime Minister have committed a further £3.5 billion, taking the total funding to an unprecedented £5.1 billion. It is simply not correct to say that we are doing nothing; that is a considerable sum of money and a massive commitment to recognising that we need to dampen the impact of the costs of remediating the unsafe cladding—the major fire accelerant on these buildings—so that a tragedy like the Grenfell Tower fire never happens again.
I also take issue with the noble Earl, Lord Lytton, whose contributions I really enjoy; he is a property professional who speaks with great passion. The reality is that I spent the last year at the coalface, dealing with the tail of building owners who do not want to get on with the remediation—even when the funding is in place. There are two enforcement routes to get them to move even when they do not want to: one is the Housing Act 2004 and the other is the current fire safety order of 2005. It is recognised as an enforcement route, even for external cladding systems; it is just that some fire and rescue authorities feel that it is too ambiguous. That ambiguity, lack of clarification and operational disagreement between different fire and rescue services—I say this as Fire Minister—is a significant problem. However, one reason that remediation is happening today is that enforcement options are in place and this modest three-clause Bill is a very sensible clarification of the fire safety order of 2005.
We are at an impasse. I hope that we may get this vital Bill through, because it is important to get that legal clarity I have referred to. The safety of leaseholders and residents is paramount, and it will be compromised if we do not ensure that this Bill is placed on the statute book by the end of this Session. Tonight is the moment to decide that very fact. The Bill falling will not help leaseholders or make homes safer.
I turn to the amendment from the noble Lord, Lord Kennedy. It lacks clarity in prohibiting all kinds of remediation costs being passed on to leaseholders. It means that, where costs are minor, as a result of wear and tear, or even where leaseholders are responsible for damage, they would still not be expected to pay, which is not a proportionate response. I think all Members would agree that the taxpayer should not pay for all and every cost associated with remediation. The scope is far too broad to be a sensible solution.
In several ways, this amendment has the potential to make things worse for leaseholders; for example, it is unclear who should take responsibility for remediation works until a statutory funding scheme is in place to pay for the costs. This would result in all types of remediation being delayed, which is an unsatisfactory outcome for leaseholders. Practically speaking, on the amendment’s requirement to deliver particular requirements to Parliament within 90 and 120 days, we must be mindful that drafting legislation is a complex matter, which cannot be dealt with in the timeframe proposed. I note that the noble Lord is unlikely to press for a Division this evening, so I will not go any further, but to impose an arbitrary deadline, as stated, is neither helpful nor practical.
I turn to the amendment proposed by the noble Baroness, Lady Pinnock, who has indicated that she wishes to test the will of the House. We see the same key elements of this amendment time and again and the other place has voted it down time and again. The same issues apply with this amendment. It lacks clarity, which will lead to delay. The scope is too broad and there are practical issues. For instance, regardless of blame and whether it is remediation or wear and tear, it seems like no leaseholder will ever have to pay more than £600 a year. What if a leaseholder is responsible for an attempt at renovations that is picked up in a fire risk assessment and has damaged part of the structure of the building? Is the noble Baroness really suggesting that the leaseholder should not pay for that?
A number of noble Lords have asked the Government to come up with their own wording to deal with this issue but, as I have stated before, the Fire Safety Bill is simply not the right place for these amendments. It does not have the legal underpinning to carry them. This issue does not belong here.
I place on record once again this Government’s commitment to an unprecedented sum of £5.1 billion to protect leaseholders from the costs of remediating unsafe cladding. We are committed to developing stronger avenues for redress and we are ensuring that developers contribute through our high-rise levy and developer tax.
In answer to the right reverend Prelate the Bishop of Rochester, it is quite clear that the ability to deliver and provide grants will be via the building safety fund, which is in operation today. If it is helpful, I can put on record that the financing scheme does not have to await any statutory passage of the building safety Bill and will be available as a very important way of protecting leaseholders in medium-rise buildings.
The only thing that would require statutory underpinning in terms of supporting leaseholders is the high-rise levy that would form part of the regime to collect a levy for those buildings that would be considered high risk at that point. That would form part of the building safety Bill. The vast majority of this does not have to wait for the building safety Bill to be passed. The building safety Bill will be helpful to strengthen redress and make it clear what charges can passed through to leaseholders to protect them from charges that they should not be paying for.
This Government always have been and will continue to be committed to delivering the recommendations of the Grenfell Tower inquiry. I respectfully urge noble Lords to reject the noble Baroness’s amendment. I reiterate that if we do not move forward with the Fire Safety Bill and get it passed tonight, it will fall and the Government will not be able to deliver the inquiry’s recommendations in relation to external walls and flat entrance doors. Ultimately, this means that the safety of residents and leaseholders could be compromised. I beg to move.
My Lords, I thank all noble Lords who have spoken in this debate tonight. It is worth pointing out that for the second day in a row debating these issues not a single Member of the Government Benches has come forward to support the noble Lord, Lord Greenhalgh, or the Government’s position. As I said yesterday, I am not surprised because the position of the Government, frankly, is a disgrace and is totally outrageous.
The Government claim that we have not got this amendment right, it lacks clarity and we do not have the time. If we were going to accept that as a serious proposition, we would not have had this Bill just sitting there for weeks and weeks not being tabled by the Government. After it was rejected by the Commons it could have been brought here. They chose not to table it. They left it sitting there. I really do not think that point holds water.
Of course, the problem for the noble Lord, Lord Greenhalgh, is that the sums of money pledged—and I accept that they are considerable—do not deliver the Prime Minister’s pledges, or do his pledges count for nothing? I will leave that there. He makes a lot of promises and pledges. I hope they count for something or do they count for nothing?
If voting again for this amendment would change anything, I would divide the House, but I am also not prepared to mislead those affected that we can force the Government to change this Bill. Sadly, the Government are not listening and the House prorogues tomorrow.
This issue, however, will not go away. The Government will be forced to do the right thing by the leaseholders, by the campaigners, by the Cladiators and by Members of this House and the other place. They will be dragged kicking and screaming to do what the leader of their party, the Prime Minister of the UK, pledged to do. I quote the Prime Minister—I think that the House will hear this quote time and again, until the Government do what he promised. He said:
“We are determined that no leaseholder should have to pay for the unaffordable costs of fixing safety defects that they did not cause and are no fault of their own.”—[Official Report, Commons, 3/2/21; col. 945.]
That was the Prime Minister of the United Kingdom and leader of the Conservative Party, the right honourable Boris Johnson MP, in response to a question put to him by the Leader of the Opposition on 3 February. That statement was made after this Bill had been through both Houses and three weeks before the Government, in the other place, rejected our amendments for the first time. The PM’s Government voted against the PM’s pledge—his promise—at every opportunity. The position is, frankly, ridiculous; what complete and utter nonsense has come from the Government.
As I said, I will not test the opinion of the House on my Motion tonight. This issue, however, will not go away, and the Government will have to deliver on their pledges and promises. I beg leave to withdraw the Motion.
Motion A1 withdrawn.
Motion A2 (as an amendment to Motion A)
4N: After Clause 2, insert the following new Clause—
“Prohibition on passing remediation costs on to leaseholders and tenants pending operation of a statutory scheme
(1) The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act on to leaseholders or tenants of that building.
(2) This section has effect only until a statutory scheme is in operation which ensures that leaseholders and tenants of dwellings are not required to pay more than £50 per month during the course of the lease in respect of remedial work attributable to the provisions of this Act.
(3) Subsection (1) does not apply to a cost that—
(a) is permitted under a lease or tenancy agreement that was made before this Act is passed, and
(b) does not exceed £500, whether as a one-off cost, or in total across a 12-month period.
(4) Subsection (1) does not apply to a leaseholder who is also the owner or part owner of the freehold of the building.””
I thank all noble Lords for another excellent debate—the fourth in the series—and their contributions tonight.
Again, the tune from the noble Lord, Lord Greenhalgh, the Minister, has not changed—it is the same old record: “This is not the right Bill”. Well, if it is not the right Bill, where is the Government’s Bill to address the horrendous problems that are going to be faced by leaseholders? Where is the Bill that will keep the Government’s pledge that leaseholders would not have to face the unaffordable consequences of fire safety defects? Where is it? Its absence tells us more than anything else about the Government’s commitment to help leaseholders.
To pledge, as the Minister has done, that the building safety Bill will pave the way, forgets the fact that bills are landing on doormats as we speak. Time is of the essence, and still the Government refuse to move. It is a thoroughly depressing moment when people can be thrown to the wolves in order to save the Treasury from paying what it ought to pay and extracting what it ought to extract from those who have caused the problem. The construction scandal—the cladding crisis—is the Government’s, and the Government’s alone.
I thank the Minister for his criticisms, once again, of the amendment I have proposed today. I just wish he would do something about it rather than saying that he cannot do this and cannot do that. What is he going to do?
I have taken heart from the impassioned speech by the noble Earl, Lord Lytton. He is an expert in the housing field and has frequently shared his expertise in this House. The fact that he too cannot in all conscience vote for the Fire Safety Bill as it stands, unamended, gives me heart that we have got this in the right place from the point of view of those of us who want to protect people from exorbitant costs of putting right fire safety defects.
I will say one last word. Let us remind ourselves that leaseholders are those that have done everything right. They have saved up for their house, put down the deposit and budgeted for the expenses they anticipate. They have done everything right and nothing wrong, yet the Government—and, it seems, others in this House—are willing to make them pay the price. That is not acceptable, and the Liberal Democrat Benches will not stand by and let it happen if we can help it. It is a depressing moment, as I believe the noble Lord, Lord Kennedy, has indicated that he is not prepared to vote for the amendment to try to get safeguards for leaseholders. He has thrown in the towel, and I find that disappointing and utterly depressing.
However, with those words, I am prepared to have one more go to try to protect leaseholders and, indeed, tenants from the awful, if unintended, consequences of this Fire Safety Bill. I wish to seek the opinion of the House and I beg to move.
Motion A agreed.
My Lords, I do not wish to detain the House unduly, but I need to draw the attention of the House and, in due course, the Procedure Committee to the really unsatisfactory way that our proceedings are conducted on these important matters relating to Commons reasons.
The Commons debated this matter only a few hours ago, and there is no Hansard account of the debate. We were not at all clear when we were going to debate these hugely important matters affecting millions of our fellow citizens: we were told it might be at 4 pm and then 4.40 pm. Many of us have had to hang around the House for hours, waiting to be told when it might happen; we were only recently told that it would be at 7.10 pm.
Until I came into the House, half an hour ago, I was not aware of the amendments that have been tabled because they are not available, in the haphazard way that we conduct these proceedings. I and many other noble Lords have not yet had a proper opportunity to assess the amendments. They are quite complicated and we are being railroaded into taking decisions on them in the next hour.
This is a totally unsatisfactory way for this House to consider important legislative issues. Although I do not wish to detain the House unduly now, as I have said, I feel duty-bound to draw the attention of the House to the unsatisfactory nature of the proceedings. We should take this matter up with the Procedure Committee. We have proper arrangements for the consideration of Bills at all other stages, including fixed intervals between the different stages of consideration. These are in our Standing Orders and they should apply at this vital last stage of Bills, when we are engaged in interchanges with the House of Commons. I beg to move.
I start by saying that I disagree with the noble Lord: his amendment is unnecessary because there is a Commons Hansard transcript—it is online and has been since just after 5.30 pm. Nevertheless, the noble Lord’s amendment gives me the opportunity to make it clear to the House that what is proposed for the consideration of the Fire Safety Bill today is entirely in keeping with the normal practice of the House. By “normal”, I mean that this has long been the case and has nothing to do with how we have been working more recently in the hybrid House.
The noble Lord mentioned Standing Orders. Standing Order 39(4) reads:
“Commons amendments to bills and Commons Reasons may be considered without notice”,
and the Companion states that they
“may be considered forthwith on the day they are received”.
The guidance on the hybrid House states at paragraph 108 that
“further rounds on the same bill may take place on the same day”.
This will be the third time that this House has considered Commons reasons on this Bill. Before today, Commons messages were considered by this House on 17 March and 20 April, and the House of Commons has made clear its view on the last remaining issue three times, on three separate occasions.
Proceedings on the Bill in the Commons commenced today at 2.20 pm. Since that time, noble Lords have been able to re-watch those proceedings at their convenience on parliament.tv. In fact, in the time that has passed between the Commons finishing and our starting, any noble Lord could have watched the entire Commons debate at least three times. As I said, this is the way in which issues between these two Houses have been resolved for decades and I therefore ask the noble Lord to withdraw his amendment.
I have not received any request to speak after the Minister. Does anyone in the Chamber wish to speak? Lord Adonis.
My Lords, the noble Lord is right to say that matters have been considered in this way in the past but that does not make it satisfactory. He said that the Hansard account was available at 5.30 pm. That was one hour and 40 minutes ago and most of us were not even aware of that fact. I did watch the House of Commons proceedings on replay and had to note down by hand all that had been said several times, so that I could get the wording correct. No ordinary member of the public would think that these proceedings are satisfactory, and the Procedure Committee should look at them with a view to improving them. Huge issues are at stake here and they should not be rushed and railroaded through in this way. On that note, I beg leave to withdraw the amendment.
4K: Because the issue of remediation costs is too complex to be dealt with in the manner proposed.
My Lords, I should like to start this debate by paying tribute to the fire and rescue services across our country. In recent days, we have seen large fires in Greater Manchester and Shropshire, which have been dealt with by those services with exemplary bravery and professionalism. That is a reminder of why we want to get this Bill through: to help fire and rescue services do their job, and to ensure that buildings are properly and thoroughly assessed and that the risk of fire is minimised as much as possible.
I am fully aware of the pain and anguish that the cost of remediation is causing leaseholders, but all of us in this House agree that residents deserve to be and feel safe in their homes. I do not want to repeat all the Government’s reasons for resisting these amendments, but I do want to reiterate that this is a hugely complex area. There is no simple solution and I am afraid that it cannot be resolved through amendments to this short, technical Bill.
The other place has now voted against these different remediation amendments put forward by your Lordships’ House, the last one of which was rejected by 64 votes earlier today. That confirms that the other place has supported the Government’s view that the Bill is not the right legislation in which to deal with remediation costs. There is consensus in both Houses that the fire safety order needs to be clarified. That is because we want to avoid a scenario in which defects with external walls or flat entrance doors in multi-occupied residential buildings are not identified, resulting in a potential increase in fire safety risks for everyone living in such places.
Given this consensus, coupled with the fact that the other place considers that the Fire Safety Bill is not the right place to deal with remediation costs, I again ask your Lordships to agree that this Bill should go on to the statute book. If noble Lords insist on a legal resolution to the issue of remediation costs through this Fire Safety Bill, then I am afraid that this important Bill will fall on the grounds that this could mean that responsible persons for multioccupied residential buildings can argue that it is lawful to deliberately ignore the fire safety risks of the external walls and flat entrance doors.
As noble Lords have heard in previous debates, the Government’s ability to lay regulations to deliver on the entirety of the Grenfell Tower inquiry’s recommendation is subject to this Bill gaining Royal Assent. If this Bill were to fall there will be a delay delivering the inquiry’s recommendation in respect of external wall structure and flat entrance doors.
I place on record again that the Government are committed to protecting leaseholders and tenants from the cost of remediation. Under the plans announced by the Housing Secretary in February this year, hundreds of thousands of leaseholders will be protected from the cost of replacing unsafe cladding on their homes. The £5.1 billion in grant funding made available to leaseholders is unprecedented, but I agree that leaseholders need stronger avenues for redress. The building safety Bill will bring forward measures to do this, including making directors as well as companies liable for prosecution. I agree that the industry must play its part, and the Government agree with the broader polluter pays principle. Through our high-rise levy and developer tax, industry will pay.
I repeat my message from the last time I stood here at the Dispatch Box:
“We recognise that the … Fire Safety Bill will lead to more remediation issues being identified, but there will be occasions when other measures to mitigate the risk are required, rather than extensive remedial works.”
However, the solution and the costs involved will vary depending on the corrective measures required. Not all buildings will need extensive remedial works. For example,
“the vast majority of lower-rise buildings will not require the type of remedial work discussed in the House today.”—[Official Report, 20/4/21; col. 1377-78]
To suggest that this Bill will unleash hundreds of thousands of costs, all of which will be major and substantive, is simply not the case. It is also incorrect to suggest that the Bill will create further liability for leaseholders. The Bill does not create liability; it is a simple Bill to clarify the fire safety order and let our fire and rescue services do the job they do best, which is keeping us safe.
I ask noble Lords to reconsider their position of insisting on the remediation costs amendments days before the end of this Session, which risks the Government’s ability to implement an important legal clarification that will improve fire safety and help protect lives. I beg to move.
Motion A1 (as an amendment to Motion A)
4L: After Clause 2, insert the following new Clause—
“Legislative proposals relating to prohibition on passing remediation costs on to leaseholders and tenants
(1) The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act on to leaseholders or tenants of that building.
(2) Subsection (1) has effect only until a statutory scheme is in operation which ensures that leaseholders and tenants of dwellings do not have to pay for remedial work attributable to the provisions of this Act.
(3) Within 90 days of the passing of this Act, the Secretary of State must publish draft legislation to ensure that leaseholders and tenants of dwellings do not have to pay the costs of any remedial work attributable to the provisions of this Act, and must also publish a statement on a proposed timetable for the passage of the draft legislation.
(4) Within 120 days of the passing of this Act, the Secretary of State must publish a statement confirming whether the draft legislation mentioned in subsection (3) has progressed.””
My Lords, I join noble Lord in paying tribute to the fire and rescue services, and the bravery they have shown recently and every day. But these heroes—they are heroes—are FBU members. They have not always been shown the respect they deserve from many people, particularly the Prime Minister when he was Mayor of London. He did not always show the FBU members the respect they deserved, and these are the same people. I make that one point.
I draw the House’s attention to my relevant interest as a vice-president of the Local Government Association, a non-executive director of MHS Homes Ltd and chair of the Heart of Medway Housing Association. It is most disappointing that we are back here again, and I accept that it is very unusual for us to push this again, but I will test the opinion of the House.
My amendment is based on the amendment from the right reverend Prelate the Bishop of St Albans, and it would ensure that no costs are passed on to the leaseholders or tenants. That the subsection would remain in force until such time that we get the Government’s statutory scheme. Further, it would place a requirement on the Secretary of State to come back within 90 days to publish draft legislation to ensure that leaseholders and tenants do not have to pay, and to publish a timetable for the implementation of that legislation. Finally, we would also require a progress report from the Secretary of State within 120 days of the passing of this amendment.
Now, why are we back here again? It is because the Government have been quick to promise and slow to act. We are here because they are not listening to the innocent victims of the cladding scandal, who should be at the forefront of the levelling-up agenda, if it is anything but a slogan that the Government have no intention of delivering. These people are families whose homes are blighted. They need their Government to come to their aid but, instead, the Government made promises that they have spectacularly failed to deliver. That is no way for a Government to behave. As I said, I intend to divide the House when the time comes.
“We will do whatever it takes” is a statement that the Government regularly put about, whether from the Chancellor announcing new measures or the Culture Secretary regarding the European Super League. Sadly, it is never said by the Government when it comes to dealing with the innocent victims of the cladding scandal. Perhaps, in replying to the debate, the noble Lord, Lord Greenhalgh, the Minister for Fire Safety, can explain that failure to the House, because we have never heard from the Government what the plan is, which is part of the problem. If we are informed of a clear, well thought-out pathway and route map to help the victims we could make progress, but for some reason the Government will not do that. Perhaps the noble Lord can tell the House about this road map when he responds to the debate.
I want to see this Bill on the statute book, but I do not accept for one minute that this puts it at risk. We still have days before the end of the Session. I do not want to hold the Bill up. It is good in what it does, which is to implement the first recommendation of the Grenfell Tower inquiry—the first bit of legislation since the fire, now nearly four years ago. No one can accuse the Government of acting in haste. On a separate matter, we still have six families in temporary accommodation following the fire at Grenfell Tower.
It is vital that our dwellings are safe and that people can sleep safely at night, without fear. The Government have committed £5 billion—I accept that that is a significant amount of money—but the situation is far from satisfactory and it is in the Government’s gift to do something about it. Only the Government can do something about it, but they are not willing to at present. As the right reverend Prelate the Bishop of St Albans told us when we last debated this—I pay tribute to him for his leadership and for seeking a solution to this scandal—the result can be bankruptcies, enormous mental health strains and possibly worse. Part of the problem is that there have been no assurances to prevent the remediation costs being passed on to leaseholders until the Government’s scheme is operational. This is what my amendment seeks: to prevent the costs of this scandal being passed on to tenants and leaseholders, the innocent victims.
We have all seen in the media the heartbreaking reports of the crippling costs that leaseholders are having to bear, such as interim fire safety costs and high insurance premiums. Surely the developers that built these defective flats, the insurance companies that provided the guarantees but no longer want to honour their commitments and the professionals who signed off the buildings as safe should be paying through their professional indemnity insurance. Instead, innocent victims are left bearing the costs of this scandal, despite the promises made to them.
This leaves them with a dilemma: sell their lease and take on the debt resulting from negative equity, or stay in their leases and face huge debts in the form of remediation bills. They might possibly declare bankruptcy. Surely that is wrong. The leaseholders are playing by the rules and paying their taxes. They are buying a home and doing the right thing, but are not being supported. They had no indication that this was coming. This is a dreadful tragedy. In the absence of an adequate plan and scheme to deal with these issues properly and fairly, there is no other way forward. I hope that the House will support me. We need to find a solution to pay these costs. I beg to move.
My Lords, I start by drawing the attention of the House to my interests, as recorded in the register, as a vice-president of the Local Government Association and a member of Kirklees Council.
On three separate occasions, this House has confirmed its view that the Government should urgently address the plight of leaseholders and tenants who will be significantly and adversely affected by the consequences of the Fire Safety Bill. The provisions in the Bill are not the issue; they are a welcome small step to address the failings exposed by the dreadful Grenfell tragedy. The Government and, no doubt, the Minister will state how important it is that this Bill is passed, as we heard the Minister say a few moments ago. Both omit to say that the Government have been tardy in regard to the passage of the Bill; the Report stage in this House took place in November 2019. If the Government had made the Bill a priority, we would not be here, in the final throes of this Session, seeking to find a just solution for those directly impacted by it.
The amendment in my name reiterates the principle moved by the right reverend Prelate the Bishop of St Albans in the last debate on this matter, which this House has supported on three separate occasions, that the leaseholders and tenants must not pay the exorbitant costs of remediation. We have listened to the Government’s criticisms of the previous amendments, and today’s amendment in my name takes into account the reasonable expectation that leaseholders will be required to pay for minor fire safety works up to a value of £500 in any one year.
What is so disturbing is that the Government have consistently failed to propose just how leaseholders will be safeguarded from the costs of remediation. The Building Safety Bill will come far too late to prevent untold harm to individuals and their families. Leaseholders have done everything right and nothing wrong, and must not be expected to pay for those who have profited from construction failures. The Minister will no doubt repeat that the Government have a grant fund available for the removal of cladding from high-rise blocks. But he fails to say that it will not cover the costs of putting right the construction failures that are then exposed, and that it will not include many—perhaps a majority of—blocks affected.
Individuals have shared with me the precise costs they are being asked to pay. For example, the total bill for remediation at Connect House in Manchester is £5.2 million. The average bill per flat is £78,000, to be paid in quarterly instalments by the end of this year. Then there is M&M Buildings in Paddington, where ACM cladding has been removed following a government grant, but non-cladding defects, which the building safety fund does not cover, are costing each leaseholder £40,000. Imagine living in a modern flat and discovering that, as a leaseholder, you are faced with a bill for £20,000 to put right internal steelwork and wooden balconies that the developers had failed to make fire-resistant, even though that was part of building regulations at the time. These are just three leaseholders out of thousands who are facing potential bankruptcy as a direct consequence of this Bill. No one could possibly have budgeted for additional costs on that scale. And that is not the only extra bill suddenly landing on doormats; there are demands for waking watch, insurance hikes and a fire alarm system. For Zoe, in London, that has resulted in service charges rising from £194 a month to a totally unaffordable £700 every month. For some, those service charge hikes alone are forcing them into bankruptcy.
The direct personal impacts are not the only unconsidered consequences of the Bill. In last Sunday’s edition, the Sunday Times reported that the Bank of England is concerned about
“the scandal’s effect on property”
prices. The report states that up to 1.3 million flats are now “unmortgageable” and
“three million people face a wait of up to a decade to sell or get a new mortgage”.
The Leasehold Knowledge Partnership has found that 80% of auctioned fire-risk flats failed to sell or were discounted by as much as two-thirds. For social housing landlords, the total cost is estimated to be as much as £10 billion, as they are unsupported by the government scheme. The knock-on effect of that will be a dramatic reduction in the number of new builds for people who desperately need a home to rent. It is not, therefore, the Bill itself that is the problem but the consequences, which are very grave indeed for individuals and their families, as well as for the wider housing market.
In the end, it comes down to a simple question of justice. Those who have done everything right and nothing wrong must not be asked to pay the price for those developers who, in some instances, knowingly failed and profited by that safety failure. I really cannot understand the Government’s obduracy in the face of a calamity that is about to fall on lease- holders. I find it hard to imagine taking a decision that knowingly forces thousands into potential bankruptcy and homelessness.
I urge the Government, even at this late stage, to listen to those who are on the brink of losing their home and everything they have worked and saved for. They have done everything right and nothing wrong. I give notice that if the noble Lord, Lord Kennedy, seeks to divide the House, he has the support of these Benches. If, however, he chooses not to do so, I will move my amendment and seek the opinion of the House.
Well, my Lords, here we are again. I do not want to detain your Lordships’ House for too long, because everything has been said several times already, but I want to make a few comments, if I may.
I, too, want the Bill to pass. I pay tribute to Her Majesty’s Government and the money they have already found and put on the table, which is very significant. But since we last gathered here, the sheer scale of the crisis, which is in its very early stages, is slowly beginning to unfold before us and become ever clearer. I believe that is why the majority in the other place declines each time an amendment goes back, because those long-serving, seasoned campaigners in the other place realise what is going on. The stories are coming out absolutely relentlessly, and new research is being published.
At a few minutes to four this afternoon, I received an email from someone who works in Parliament. I will call her Claire; that is not her real name, but she will know who she is, because she emailed me at 3.56 pm and asked if I will speak up. She said, “Will you speak up for the leaseholders again and table an amendment? I bought a flat under the shared ownership scheme. I own a 25% share, yet I am liable for 100% of the costs. I am already paying an additional amount each month, and I know this amount will soon increase as further remediation work takes place. I simply cannot afford to pay for the remediation works, nor should I have to. The stress of this situation is becoming intolerable. My mental and physical health are approaching a state of collapse”. “Will you speak up?”, she said. I have not met her yet—I hope she will say hello to me one day, perhaps when she guesses who I am or sees me around the place. This is someone who we bump into, who works in this place and who serves us.
It is not just the many individuals. Since we last came to this provision, research by the Prudential Regulation Authority, which is assessing the building scandal, has said that it poses a systemic risk to the UK financial sector. Some of the work done since then is finding a huge number of flats and homes which are simply unsellable. For example, it has been reported that
“a one-bedroom flat at Leftbank, in Manchester, failed to sell despite being listed for half the £330,000 its owner had paid in 2017”.
What Members in the other place are realising is that, slowly, this will roll out, and it will mean that many people on whom this Bill relies to be able somehow to stump up the money to repair the buildings will not have that money. The buildings will not be repaired, because some of these people will have to walk away, probably very unwillingly.
We have not only those individual stories but some really worrying assessments coming out of the housing and financial market in our country. Some 3 million people, as we heard from the noble Baroness, Lady Pinnock, are affected. As we are paying tribute to fire and rescue officers, I have three emails from fire and rescue officers who were personally affected by this cladding. These are the people involved, along with nurses, police, teachers, care workers and many others—the House knows the sort of people we are talking about.
I believe that the intent of these amendments is the same: to accept that we have a very difficult problem and really want to see some sort of brokered agreement, whereby developers, cladding manufacturers, freeholders and leaseholders make their fair contribution. We realise that everybody will have to do that, but feel that there need to be protections for leaseholders and tenants over these coming months, before the government scheme comes in. I am minded to support this Motion if the noble Lord, Lord Kennedy, brings it to a Division, but I continue to hope and plead that Her Majesty’s Government will be able either to come up with a compromise or make some sort of formal undertaking on what the building safety Bill will offer, so that we can all get behind it and get this really important Bill through.
My Lords, I declare my professional involvement with construction and property matters and that I am a vice-president of the LGA. We should be in no doubt that the Government have triggered an issue that is destined to cause significant damage, loss and distress to many leaseholders and tenants. My comments will be aimed at Motions A1 and A2 in the names, respectively, of the noble Lord, Lord Kennedy, and the noble Baroness, Lady Pinnock. I commend them on their persistence and diligence.
I also commend the Government on committing their £5.1 billion to this matter, but the reality is that money alone is not the answer. It requires a plan that is co-ordinated, structured and comprehensive; to be honest, it was needed the day before yesterday and certainly not at some unspecified time in the future. The Government cannot, in all conscience, have been unaware that a situation would likely arise where a significant sector of property might be affected by the expansion of the fire safety regime, nor deaf to the observations of just about every informed observer, from, I believe, the Bank of England downwards, warning of the need for action.
The ill effects triggered by this Bill are already plain in evidence, with insolvencies and repossessions, and bills for safety works of such improbably mind-numbing sums as to make every speaker in the time-limited debate in the other place this afternoon—everyone, that is, save the Minister—voice support for the amendment we passed last time around. These problems are only just unfolding, as the right reverend Prelate has identified. The horror story is therefore far from over. I do not accept the Government’s claim that it is a small number of properties that are affected, and I do not believe the Government have demonstrated that there is any statistical backing to that claim.
The Government’s own partial scheme, under the yet to be introduced building safety Bill, will neither offer relief to anything more than a modest proportion of those affected nor arrive in time to assist many of those in its intended target group, as matters stand at the present. I do not blame the Minister—I believe he is a person of great integrity—but I do blame the government machine he appears to be obliged to defend. I have to say that the stance of the Government here is not the coherent or considered response of any responsible Government, given the scale of the issues at stake and the market and financial perils that are the probable and natural outcome of the changes created by the Bill.
The Government appear to have resorted to arm-twisting, pitting the need to respond to the circumstances and death toll of the Grenfell fire against the financial and psychological terror to be inflicted on maybe a million more households. They accuse us of holding up the Bill, perhaps causing it to fall. They conflate the regular maintenance obligation of, say, changing a back-up battery in an alarm system with the fresh requirement to complete a whole new safety installation. They suggest that the matter is less than what those who have commented to me have made clear. I rather take exception to such tactics.
The Government could introduce their own scheme, and could have done so long ago. They could commit to do doing so now, and tell us that they will use the Queen’s Speech at the forthcoming State Opening of Parliament to announce a forfeiture protection measure in appropriate circumstances. They could take up the suggestion in the Fox amendment in the other place that a regime akin to the “polluter pays” principle for contaminated land be introduced. They could follow up the McPartland amendment route to redress, which I tried to persuade the Government of last time we debated this.
I ask the Minister: are the Government willing to take up any of these initiatives, as opposed to indicating that they accept the principle, or will they continue to stall with arguments that all the amendments are unworkable, have unforeseen consequences or are otherwise impractical—rather like, I should say, the effects of the Bill that has got us into this pretty pass in the first place? I agree that the issues are complex, which is exactly why government-level intervention and leadership are required to corral those responsible. That is a government duty.
A few days ago, I circulated to the Minister and other noble Lords the professional indemnity insurance consequences that are unfolding. This is just another issue that is befalling the sector. I cannot conceal a sense of outrage here about inaction and, worse than inaction, about what for hundreds of people will be an absolute catastrophe. There is inaction not over money but over the need for good governance and necessary executive process.
So painfully absent is any sense of mission, purpose or acceptance of the role of government in dealing with hard cases that I find myself having run beyond empty my natural inclination to give the benefit of the doubt to the Government of the day, much as it is my normal inclination to do so. I have tried to bring my technical knowledge to bear, without success. There is not the slightest doubt in my mind that the Minister understands, and through him the Government understand, yet they choose not to act to avert terrible outcomes for innocent home owners.
I have to say, with much regret, that if it is the only way to persuade the Government to take the responsibility seriously—to oblige them to take the sort of action that any Government ought to and that only government really can take—I am left with no choice that satisfies my conscience and the directions of my moral compass other than to support Motion A1 in the name of the noble Lord, Lord Kennedy, preferably with Motion A2 in the name of the noble Baroness, Lady Pinnock
The following Members in the Chamber have indicated that they wish to speak: the noble Baroness, Lady Fox of Buckley, and the noble Lords, Lord Stoneham of Droxford and Lord Adonis. I call the noble Baroness, Lady Fox of Buckley.
My Lords, while the headlines are all focusing on the scandal of who paid for the internal refurbishment work on a flat in No. 10, for me this is a far greater scandal about who is being forced to pay for the external remediation works on more than a million flats caught up in this fire safety cladding debacle. As things stand, innocent leaseholders—the only party with no hint of blame for negligence or mistakes—are the sole group to shoulder the burden. We have heard some passionate speeches about that.
Why am I back here? I just need some reassurances from the Government. They say that this is not a legislative matter and that this is not the legislation, so what are they going to do? Many of us united here usually disagree. My goodness, the noble Lord, Lord Adonis, and I are on the same side. Whatever is the matter? But we are here in good faith. This is not Tory-bashing or a cheap dig at rich developers or landowners—it is a warning to the Government.
This reminds me of the convictions of the 39 post- masters, now cleared, but after the tragedy of what befell them because no one would listen. It also feels to me like a betrayal of all those promises made to the red wall voters that this Government care about the aspirations of ordinary people. It seems to make a mockery of parliamentary priorities, and I genuinely do not understand the point of us being here and debating levelling up when many leaseholders concerned bought their flats or houses as part of affordable housing schemes. They are front-line workers who have been thrown to the wolves.
Similarly, what is the point of legislating on the welfare of veterans and supporting the police when one veteran and serving police officer writes to me explaining that he has worked every day since he was 16 and has never needed to rely on state benefit or accrued debts in any way, yet now faces bankruptcy and could even, as a bankrupt, lose his job. He describes it as a living nightmare. He says: “I am a leaseholder, and that is the biggest mistake of my life.” What a terrible thing to say. He says he is disillusioned, angry and frustrated, and powerfully notes that he feels defeated and that all his attempts to be heard are ignored.
These leaseholders feel ignored. Whatever happens here today, I ask the Government to listen and not to ignore them. At the very least, I ask the Minister to listen to the Bank of England. As the noble Baroness, Lady Pinnock, noted, last week the Bank of England said it is seriously assessing whether the building safety scandal could cause a new financial crisis—hardly an encouraging sign for building back better or economic growth.
Even from a pragmatic basis, I do not understand why the Government will not note that if more than a million properties become unmortgageable, if we create a negative equity problem, if leaseholders become bankrupt and cannot pay for remediation costs, if there is a knock-on effect on property values, if there is an effect on labour market mobility because people are unable to sell their homes, are trapped and have to stay where they are, surely this is a matter that the Government, even the Treasury, might look at. We look to the Government here because only they can provide the capital up front to pay for the works now.
The Commons reason for rejecting the amendment is that
“the issue of remediation costs is too complex to be dealt with in the manner proposed.”
I just want to know what manner is actually proposed. The plan from the noble Earl, Lord Lytton, seems sensible to me. I would like to hear the Government’s.
I do agree that there are no easy solutions. That is why it is too easy for the Government to boast of generous loan funds and grant schemes when people are ineligible to apply for them and are facing huge bills now. Although it is tempting, it would be too easy to blame developers or whatever, and that is not my intention—I just do not want the blameless to pay.
It is also too easy to use the Grenfell tragedy to imply that those of us supporting the leaseholders or backing these amendments are cavalier in any way about fire safety standards. As a leaseholder, I assure noble Lords that I am not cavalier about my own safety. But I do note that today the Grenfell United campaign has issued a statement saying:
“Using Grenfell Recommendations to justify government’s indifference is deeply upsetting for us”.
As victims of the Grenfell fire, they say that they stand in solidarity with innocent leaseholders.
I know that the Bill is good and full of good intentions, but it creates liabilities for leaseholders without giving them any means of redress and, more broadly, it betrays any commitment to a meritocratic society. I appeal to the Government to listen.
We have had some very good speeches and some very good points have been made, so I will speak quite briefly. First, I declare my own interests in property and as someone with 15 years’ experience of housing association work. I am speaking tonight largely on behalf of my noble friend Lord Newby, who has been tied up in commission work for most of the afternoon.
Looking back at last week’s debate, at the Minister’s speech and at the debate in the Commons this afternoon, I thought there was far too much emphasis on fear of the Bill not going through rather than on trying to set out and address the concerns not only of both Houses but of leaseholders, who have the uncertainty and the fear of liability. Simple fear is prevailing, and that is what we need to address. It is why the Government are in some difficulty in getting final decisions on the Bill.
Let us not forget that a lot of the leaseholders affected by these problems are first-time buyers. Developers made a lot of money out of government deals. The Government have been very keen on first-time buyer schemes and stamp duty relief. Why is it that they are so reticent to spell out more detail and give more assurance to leaseholders in the problems that they are facing? The noble Earl, Lord Lytton, was absolutely right: the Government are very keen on plans in all sorts of areas, but they really need a plan to deal with this problem.
In just one area, pooled insurance, there is great fear of the costs for leaseholders from their insurance going up because of the problems that they are facing and the extra risk that the insurance companies assess. The Government responded very quickly when there were pictures of people with their homes flooded and residents trying to deal with their problems in specific geographical areas, and they very quickly came up with pooled insurance schemes. Why are they not doing that more in this area? These leaseholders are a very specific group and they need help.
All evidence and experience suggest that the problem will grow. We have evidence in our own ranks of a Peer whose block of flats had a cladding problem: when the cladding was taken down, the block was found to be unsafe structurally. This is a growing problem. What lies behind the cladding, I suspect, is what is scaring the Treasury rigid. However, the problem has to be dealt with.
I am afraid that a lot of these properties were designed and built for first-time buyers. The developers knew they had to keep the price down when prices were escalating, but they also kept the costs down because they wanted to make their profit. They made a lot of money, so there will be all sorts of problems in these buildings.
The leaseholders will have seen the situation last week of the sub-postmasters and will be thinking that, as time goes on, they will be left behind and hung out to dry by the bureaucracy and the government machine failing to address their problems. They need protection from eviction, and they need to know exactly how they are going to be able to access grants.
They need to see the Government putting pressure on the developers. In some respects, the Government are a bit too close to some of those developers, but they need to be seen to be taking on the developers, the companies and the contractors involved in these buildings to make sure that it never happens again.
The industry is in fact dysfunctional. It is going to demand government intervention to address skills, regulation and the whole quality of development in this country. The Government need a plan and a timescale. They need to address the uncertainty and fear among very vulnerable people, and they need to start now as the problem will grow. That is why we support these amendments.
My Lords, the cladding scandal is turning into the next Hillsborough scandal, in terms of not only the terrible and avoidable loss of life but the failure of the public authorities to react in a timely, just and effective manner afterwards. As event after event unfolds and failure succeeds failure in terms of government inaction, I am afraid the scandal grows. Those of us who have seen these events over many years know that there will come a point where the Government will have to concede on these issues.
Anyone who watched the debate in the House of Commons this afternoon and saw impassioned speeches from a string of Conservative MPs—many of whom had encouraged first-time buyers to buy their properties in their political lives, including many of them to buy council properties as leaseholders that are now unsaleable and submerged in negative equity without even a proper schedule of works that can be agreed—will know that this position is becoming unsustainable politically. Not only that, it is becoming a moral quagmire on the part of the public authorities at large: local authorities, regulatory authorities and the Government themselves.
The Minister is in an unenviable position, and we all know why he is in that position. It is because giving the kind of commitment that has been talked about would mean that the £5 billion scheme the Government have announced so far, could, on the basis of estimates I have seen and were being quoted in the House of Commons, be £10 billion or £15 billion. But in this situation we have to work to the just solution, and the just solution is clearly that innocent leaseholders should not be held accountable for costs which had nothing to do with them, were beyond their control and purely in the authority of shoddy developers or inadequate public authorities.
Those developers should be held accountable in due course and the role of the Government is to see that, in the interim—and that interim could be many years; it could be decades before these issues are resolved—innocent leaseholders are not held to ransom. I mean that genuinely; they are held to ransom because they cannot sell their flats and properties until the cladding is sorted out, and in many cases they will be completely unable to meet the costs.
The most powerful speeches in the House of Commons this afternoon were made by Iain Duncan Smith and Liam Fox. The noble Baroness, Lady Fox, thinks that she and I are not always on the same wavelength, but I can assure the House that Iain Duncan Smith, Liam Fox and I hardly ever find ourselves in the same company. But everything that they said today was utterly compelling.
They read from accounts given to them by their constituents of estimates for works of £30,000, £40,000 and £50,000, negative equity, inadequate access to the fire safety fund, insurance increases of 1,000%, large charges faced by leaseholders for interim measures and charges not covered by the scheme. The Government said a forced loan scheme would be announced in the Budget, but one MP—I think it was the Conservative MP for Southampton—said “Which Budget is the Chancellor talking about because it hasn’t come in this Budget? Is it going to be the one next year or the one in 2030?”
These are the elected representatives of the people seeking to hold the Government to account. Our role as a revising Chamber in a matter of such huge importance as this is to see that their voices can be properly expressed and heard. The Minister said that there was a decisive majority in the House of Commons, but between today’s vote in the Commons and the previous vote, the Government’s majority fell by half—I repeat, by half—as a result of one further debate where these issues were properly aired. We have a duty to send this issue back and I am absolutely sure that if the Government succeed in railroading this through—they probably have the votes to do so—it is right that we see whether, with a further opportunity for discussion, more progress can be made.
It is only a matter of time before the Government will have to make significant further concessions. I say to the Minister with all due respect that they will drag the reputation of the Government and the state to a much lower level by not conceding in a timely fashion—as they should have done at some point over the last four years, but certainly must in this endgame where the issues have been raised as matters of acute concern.
With respect to the arguments, the Minister says that it is not correct or appropriate to use the Bill to legislate on this issue. My noble friend Lord Kennedy’s Motion does not use the Bill to legislate for a solution; it requires the Government to come forward in due course with their own legislation. All it does in its various provisions is to set down timescales by which the Government must do this. The Government may say that they are not prepared to come forward with legislation but the arguments keep moving. Last time, the Minister said that legislation might not be required, as he might be able to take all these actions to protect leaseholders without it. If he is not prepared to accept my noble friend’s amendment because of the legislative components, it is incumbent on him to give a commitment and say when the Government will come forward with a scheme.
Christopher Pincher, the Minister in the House of Commons, made a lot of spurious suggestions in his reply there just a few hours ago. He said that the proposal by the right reverend Prelate the Bishop of St Albans was ineffective because it would prevent “very minor” costs, such as replacing smoke alarms, being passed on. That is a ludicrous suggestion; the Government could come forward immediately with a scheme to deal with minor costs if they were so minded, and I see that the amendment from the noble Baroness, Lady Pinnock, specifically exempts minor costs. He also said that it would absolve leaseholders from responsibility for works that might be their responsibility. There will be cases where leaseholders have responsibilities, and they should be held accountable for them, but the much bigger issue here, which we as a Parliament have a responsibility to deal with, is where the state has failed in its responsibilities, as well as developers failing in theirs.
We are absolutely right to send this matter back to the House of Commons if there is a majority to do so. Irrespective of whether the Government resolve this matter over the next few days before the end of the Session, they will be forced by public opinion and the weight of natural justice—as with the Hillsborough disaster and the Horizon disaster—to move on this issue. It is simply deplorable that this will happen at the very end of a long period of pressure, which will bring the reputation of the state for fair play to a very low ebb indeed.
My Lords, we all feel the plight of leaseholders. I spend most of my time as Building Safety Minister and Fire Minister in meetings at the building level, trying to accelerate the pace of remediation. Despite the fact that we have had a global pandemic over the last year, we have also had over 150 starts on site and 95% of buildings have now either had cladding of the very same type that was on Grenfell Tower removed or fully remediated, or have workers on site who are within months are making the buildings safe.
These are hard yards. I have worked with colleagues at all levels of government, with the GLA and the deputy mayor, with the appropriate lead in London Councils and with Mayor Burnham in Greater Manchester. There is a huge effort. Very often it involves difficult, brutal conversations, telling building owners and developers to get a move on. In over half the cases of buildings that had aluminium composite material, we saw the building owners step up and either fund the remediation or carry the works ahead, covering this with warranty schemes without passing the costs on to leaseholders.
These are very difficult times for leaseholders, but that is why, in answer to the noble Lord, Lord Kennedy, the Housing Secretary announced a very comprehensive five-point plan in February. Essentially, we have increased the building safety fund by some £3.5 billion to £5.1 billion. Details of how the revised fund will be spent will be announced very shortly. In addition, we have announced a high-rise levy, which will form part of the building safety Bill, and a tax on developers, because it is important that the polluter pays. There needs to be a financing scheme for medium-rise buildings of between four and six storeys. That is the plan that we have put on the table.
I also point out in answer to the noble Earl, Lord Lytton, and the noble Baroness, Lady Fox of Buckley, that the Bill does not create liability. This is a simple Bill clarifying the fire safety order to let our fire and rescue services do the job they do in keeping us safe. The Bill clarifies an existing regime. I want to be absolutely clear that it does not create a new liability.
I agree with the noble Earl, Lord Lytton, that we need to strengthen redress to stop this all falling on the taxpayer. I have been very clear that we will bring forward measures that will do that as part of the building safety Bill. They will make directors as well as companies liable for prosecution in some instances. The reality is that it is absolutely ludicrous that the statute of limitations under the Defective Premises Act is only six years. That is the statutory period of redress. We will bring forward measures to deal with that point. When I buy a pair of tweezers I get a lifetime guarantee, but when a poor leaseholder invests their life savings and makes the most significant payment in their lives to own their own home the period for statutory redress is simply not acceptable.
I come back to Amendments 4L and 4M. I am afraid that they are unworkable, impractical and do not deliver the solutions for leaseholders. As noble Lords have heard before, it is impractical and confusing to amend the fire safety order to try to resolve the issue of who pays. These amendments seek to cover the very complicated relationship under landlord and tenant law, including financial obligations and liabilities between freeholders and leaseholders. Frankly, these matters do not sit naturally with the fire safety order.
The right reverend Prelate the Bishop of St Albans spoke very eloquently to his amendment and to the two amendments that have been proposed. None of these amendments works because, once again, they orphan the liability of works until such time that a statutory scheme is in place that pays for the work directly attributable to the Act. In answer to the noble Lord, Lord Adonis, both his amendments reference the provisions of the Act in so doing. I have talked about the difficulties of defining which works might be directly attributable to the Fire Safety Bill’s provisions. I have gone over that ground several times. Orphaning liability simply delays essential fire safety works.
In addition, the proposed scope of the works remains too broad, even with the £500 threshold proposed by the noble Baroness, Lady Pinnock. It simply does not resolve the issue. Some of the works that may be required will be very low cost and anyone would reasonably expect the leaseholders to pay. That, frankly, could be more than £500 a year. As no taxpayer scheme for such minor works will be forthcoming, we then reach deadlock.
There is an additional issue which has not been raised by noble Lords: subsidy control. It is a small but important point. Depending on the specific details, it is possible that such a statutory scheme would not be permissible under subsidy control rules. Some leaseholders have undertakings—for instance in buy to let—and subsidy control rules limit how much benefit can be conferred on undertakings. In effect, it may not be possible to relieve leaseholders and tenants from all costs of remedial works attributable to the Bill without breaching subsidy control. As the noble Lord, Lord Kennedy, knows, further detailed consideration is needed.
Since these amendments are not sufficiently detailed and would require extensive drafting of primary legislation, they would continue to delay the implementation of the Fire Safety Bill and the important reforms it intends to carry out. These amendments would ultimately be self-defeating, as the pace and progress of all fire safety works would be stalled, leaving leaseholders still in an invidious position.
Once again, I ask noble Lords to exercise sound judgment. These amendments are well intentioned. However, the Fire Safety Bill is not the silver bullet to resolve the issue of remediation costs being passed on to leaseholders. This is the wrong place for this kind of legislation. In any case, the amendments are likely to be ineffective and possibly risky for some leaseholders, and even for the taxpayer. I emphasise once again that this is not the solution for leaseholders, nor what the taxpayer deserves.
This House has a choice. On the one hand, we face more dither and more delay, and the very real risk that the Fire Safety Bill will fall. On the other, we support this vital clarification of the fire safety order and a Bill that ensures that the Grenfell Tower recommendations are delivered and homes are made safer.
My Lords, I thank all noble Lords who have spoken in this debate. I must say that I am disappointed by the response of the noble Lord, Lord Greenhalgh. I noted that not one speech from the Government Benches—other than the Minister’s—supported the Government’s position. If I were over there, I would not support the Government either, and so I understand why Members on the Government Benches are sitting very quietly. I do not wish to defend them, but I think they are being very sensible. Frankly, the Government’s position is indefensible, particularly when you look at the promises that they have made. That is part of the problem: the Government think that they can get away with making promises and that, because no one will think anything else of it, they can then mess about a bit. I am sorry, but this issue is not going away.
There is a disappointing lack of understanding of the plight of the innocent victims—I repeat “innocent” —of the cladding scandal. People are really in trouble here. We have heard it tonight and we have heard it before. They need their Government to help them. The right reverend Prelate the Bishop of St Albans highlighted another case—that of Claire, who works somewhere in the Palace of Westminster. She bought a 25% share in what was probably her first property, and she is now trapped. These are innocent victims.
Why have we not had a summit at No. 10 to sort this out? I asked that last time, but I did not get an answer. We were going to have a summit about the football problems, so why not about this? If the right reverend Prelate is right, we need a meeting of COBRA to talk about the financial crisis that is on its way on the back of this. But no, there has been nothing from the Government. Why are the Government not standing up for innocent victims? Why can they not set out a route map—a pathway to say how the levelling-up agenda would help these first-time buyers, these innocent victims? We hear nothing.
I want to ask the Government to think again. There is no risk to the Bill. This is the House of Lords doing its job—asking the other place, on a matter of the utmost importance, to think again. That is really important. If the Government would spend a bit more time addressing the seriousness of the issue, we could move forward. My noble friend Lord Adonis made the point that the Government had these amendments weeks ago. They brought the Trade Bill back, but this Bill just sat there. It now turns up this week and they have said that we have to be careful because we are going to run out of time. They sat there for weeks, doing nothing with it, when they could have brought it back here.
These may not be the cleverest amendments. I am not a lawyer or a parliamentary draftsperson, nor are other noble Lords. But the Government know what we are trying to achieve. There are a lot of really clever people working for the Government; they could sort it out if they wanted to. I wish to test the opinion of the House.
Motion A2 (as an amendment to Motion A) not moved.
(7 months, 2 weeks ago)Commons Chamber
Consideration of Lords message
After Clause 2
Prohibition on passing remediation costs on to leaseholders and tenants pending operation of a statutory scheme
I want first of all to thank all hon. Members for joining in this crucial debate, because all of us in this House agree that residents deserve to be safe, and to feel safe, in their homes. I want to reiterate in the strongest terms the importance of the Bill as a step along the way to delivering that objective, and the risk that we would create if we were to continue to allow these remediation amendments, however well-intentioned, to delay legislation.
The Bill was introduced over a year ago. We are almost at the point of getting it on the statute book, and it is vital that we remind ourselves of the fundamental purpose of what we are seeking to achieve—to provide much-needed legal clarification of the Regulatory Reform (Fire Safety) Order 2005 and direct the update of the fire risk assessments to ensure that they apply to structure, external walls and flat entrance doors. I will give way briefly to the right hon. Member for East Ham (Stephen Timms), but I want as many hon. Members to speak as possible.
The right hon. Gentleman knows of the very significant amount of public money that we have set aside to remediate those buildings that are the most at risk of fire, where serious injury might take place, and the financial provisions that we have set aside also to help other leaseholders. If we do not resolve the Bill this week, fire assessments will not cover those critical elements of which I spoke, and they may continue to be ignored by less responsible building owners. Moreover, the fire and rescue services will be without the legal certainty that they need to take enforcement action. Ultimately, that will compromise the safety of many people living in multi-occupied residential buildings. Without the clarification provided by the Bill, it will mean delaying implementation, possibly by a year, of a number of measures that will deliver the Grenfell inquiry recommendations.
As I said, I want as many Members as possible to have the opportunity to speak, so I will say no more for the moment until I wind up the debate, save for reiterating two points. First, these remaining amendments, although laudable in their intentions, would be unworkable and an inappropriate means to resolve a problem as highly complex as this. Secondly, the Government share the concerns of leaseholders on remediation costs, and have responded, as the House knows, with unprecedented levels of financial support to the tune of over £5 billion, with further funds from the developer tax, which the Treasury will begin to consult upon imminently, as well as the tall buildings levy. Developers themselves have begun to announce more significant remediation funds.
It is in everyone’s interests to ensure that we do not put at risk the progress that has been made by failing to get the Bill on the statute book by the end of this Session.
Before I call the shadow Minister, may I reiterate that this is a very short debate with a long list of speakers, which is why I have put a three-minute limit on Back Benchers? Obviously, if colleagues can be shorter than that, we might actually get everybody in.
The Sunday Times reported two days ago that the Bank of England is worried that
“Britain’s building safety scandal could cause a new financial crisis.”
The Bank is worried about the scandal’s impact on property values, as new data from the Leasehold Knowledge Partnership shows that fire-risk flats can sell for as little as one third of their purchase price. That is devastating and requires an immediate response from the Government.
The Government surely should not need reminding that a collapse in house prices triggered the global financial crisis in 2007, but it seems that they do, and it seems that they also need reminding of the misery that this crisis is causing hundreds of thousands of people. The safety scandal that has unravelled in the wake of inaction and indecision since the Grenfell Tower fire in 2017 has left up to 1.3 million flats unmortgageable and affects thousands of recently built houses. As many as 3 million people face a wait of up to a decade to sell or get a new mortgage because they cannot prove that their homes are safe, and we have leaseholders who face repair bills of up to £75,000 for flaws such as flammable cladding and balconies, and missing fire breaks.
We stand here today while thousands watch this debate and suffer, worrying about their futures, getting into debt and facing bankruptcy. We have to ask ourselves what the Government actually care about. They do not appear to care that the Bank of England thinks that we are heading for a financial crisis. They do not appear to care that thousands and thousands are living with anxiety, fear and debt. They do not seem to care that the vague and undefined loan scheme that they have hailed as the answer—despite having promised many times that leaseholders will not have to pay—will damage people’s property prices and will not actually be in place, as we hear today, for at least two years, leaving thousands to pay mounting waking watch bills and stuck in properties that they cannot sell.
I completely agree with the points that my hon. Friend is raising. She will know the suffering of my constituents in Cardiff South and Penarth. Does she agree that the UK Government need to get around the table with the Welsh Government and provide clarity on how those taxes will work, and how money will flow from the building levy and the tax? The UK Government have not yet done that. We have finally had an answer to the letter from the Welsh Housing Minister, and the Welsh Government have put aside money, but they are not clear how much money is coming from the UK Government.
My hon. Friend has raised that point many times, and he is standing up for his constituents in a way that I am afraid that this Government will not.
What do the Government care about? We are left with one possible answer. Do the Government care only about the donors who keep their Prime Minister in fancy furniture, so that he can spend £60,000 on curtains in No. 10, while nurses and key workers out there face £60,000 bills for cladding with no wealthy Tory donors to bail them out? Do the Government really care only about big property developers, such as European Land and Property, which developed a block of flats in Paddington that used the same aluminium composite material cladding as was on the Grenfell Tower, and which has donated £2.5 million to the Conservative party since the Grenfell Tower fire in 2017? Do the Government really care only about Britain’s biggest builders, who have built up vast profits during the pandemic, such as Persimmon—
The Minister is shouting names at me from a sedentary position, but he is not answering the question. I do not want to be right. I do not want that to be what the Government care about. I honestly always believe the best in people and applaud my colleagues from across the House who have stood up for their constituents time and again on this, but even they are asking why else the Chancellor and the Prime Minister are ignoring a financial and human crisis on such a growing and worrying scale.
Let us vote today to start putting this right and prove me wrong. It is not just Opposition Members who support amendments to protect leaseholders. A recent poll from YouGov commissioned by the National Housing Federation found that three quarters of MPs, including two thirds of Conservative MPs, say that the Government should pay the costs of all building safety work up front and then claim it back later from those who are responsible. I have not heard a single argument that bears any scrutiny as to why it is okay to let leaseholders foot a bill for tens of thousands of pounds, or to sit by as homeowners face bankruptcy or decades of lingering debt.
We welcome the latest amendment from the Bishop of St Albans, which would put into law a guarantee that building owners cannot pass on the costs of any remedial work to leaseholders in the time before the Government introduce their promised legislation. I am also very interested in the amendments tabled by the right hon. Member for North Somerset (Dr Fox), which propose that the Government should follow the polluter pays principle.
Yet again, the Government have decided to lay a motion to disagree with the Lords amendment. This is a betrayal of the promise that Ministers have made over 17 times that leaseholders will not be left to foot the bill. The Minister’s argument that it would delay further works does not work. If the Government have not managed to work out how to pursue the money from those responsible, why do they not do what is right and stop leaseholders footing the bill?
The Bishop of St Albans’s amendment would buy the Government some time. It would protect leaseholders while the Government come up with a longer-term plan. We ask the Minister again, if he does not think that the proposed amendments are right as they are, why not amend them? Why, when it is directly in their gift, will the Government not pay to fix these problems and then go after the building companies and developers that are responsible? Leaseholders deserve justice now.
I want to end by remembering the 72 people who lost their lives in the Grenfell Tower fire nearly four years ago. The inquest is a daily reminder of the impact of the bonfire of regulations under David Cameron and the lack of care that the Government took over the last 11 years. For the memory of those who died, we must right these wrongs, we must learn the lessons and we must protect the hundreds of thousands who face daily uncertainty, fear and bills. I say to all Members: back the bishop today, vote for the Lords amendment and start to put this right.
The longer this debate drags on, the more damaging it becomes to the Government and the worse it becomes for innocent leaseholders. On Saturday evening, there was a fire in the tallest tower block in Southampton. That building has ACM cladding. As I understand it, it was alight. Hampshire fire and rescue responded quickly and dealt with the fire with its characteristic professionalism. Fortunately, the fire was not too serious, but it could have been. What would we be saying today if the worst had happened, I wonder?
I have said from the start that there are three dimensions to the fire safety scandal: the moral, the economic and the political. The moral obligation is obvious: this Government have a duty to hold those who are responsible to account and to defend the innocent leaseholders. There should be no disagreement on that issue.
Secondly, on the economic, the Government clearly think that my concerns about toxic debt, mass bankruptcy and repossession are wrong, but it is not just me who thinks it is a risk. The Bank of England is concerned, too—so concerned that it is assessing whether the fire safety scandal could cause a new financial crisis. With up to 1.3 million flats unmortgageable, perhaps the Government should be a little more concerned about the economic issue.
Finally, on the political, the Government believe in the home-owning democracy. It defines us. We have encouraged it. We have incentivised it. In fact, many people would not be in their own property without the support of Government. How do we look ourselves in the mirror when we have helped people to buy a home in a dangerous building that is worth less—sometimes much less—than they paid for it? The truth is that most MPs, including Conservative MPs, agree that the Government should resolve this issue. They believe, as I do, that it should not be the taxpayers who pay, despite what some in government have been saying. It should be those who are responsible—the manufacturers, the developers, the National House Building Council and development control. Some of those, of course, are local authorities. The Government can underwrite what is needed and then take it back from the industry. It may take years, but we will charge interest. It should be those who are responsible who pay.
We have been accused of wanting to kill the Fire Safety Bill. Nothing could be further from the truth. If the Government wanted the Bill to succeed as much as I do, they would do what was necessary to get the Bill through this place and the other place, but they have thus far chosen not to. After today, the Bill will go back to the Lords, and it will, in all likelihood, come back again. The amendment may come back with a different name and moved by someone else. If that happens, the Bill may well fall. That will not be my fault or our fault. That will be the Government’s fault.
It is a great pleasure to follow the hon. Member for Southampton, Itchen (Royston Smith). Here we are again debating a Lords amendment to protect leaseholders from having to pay to fix construction defects and unsafe cladding that never were and never should be their responsibility, and yet Ministers continue to resist, even though they have repeatedly said that leaseholders should not have to bear the cost. The trouble with this endless debate is that the clock is ticking and innocent leaseholders continue to face unreasonable costs as bills now start to arrive demanding sums of money that they simply do not possess. One constituent wrote to me last week enclosing a photograph of the bill he has just been sent, for £27,000. Another thinks that their bill will be £40,000. They obviously cannot remortgage their flats. So I ask the Minister: what are people in this situation meant to do? Sadly, we know that the Government do not have an answer to this, or indeed to the mental and emotional torment that these people are being put through. That is why this amendment is needed, and needed now.
Even taking account of the Government funding already announced, the Leasehold Knowledge Partnership estimates that about two thirds of the total cost will still fall on leaseholders: the very people whom the Government say should not pay. The Association of Residential Managing Agents estimates that the average remediation bill will be about £50,000 a flat and that insurance costs have risen by 400%. The Government estimate that the average cost of a waking watch outside London is over £2,100 a year for each flat. Leaseholders in shared ownership properties are in a particular bind. The building safety fund is moving too slowly. There is a shortage of companies who can, or will, do the work. There is total uncertainty as to what is meant to happen when we know that there are other works that have to be done to make buildings safe but for which the Government are not prepared, so far, to offer funding. I find it very hard to believe that Ministers do not understand that the remedy they have come forward with so far is patently insufficient, or that, without a comprehensive plan, leaseholders will, month by month and year by year, inevitably face financial collapse because of the huge burden of costs being put on their shoulders.
In conclusion, can I assure the Minister that the growing number of MPs who support the Lords amendment are not going anywhere, and that is because our constituents have nowhere else to go?
It is a pleasure to be able to speak in this debate.
It is unfortunate that this is the third time the House of Lords has felt it necessary to return this Bill to the House of Commons. That is because their lordships, like many MPs across the House, feel that the Bill cannot progress without some form of protection for leaseholders. It completely astonishes me that people in government cannot hear the screams of pain of leaseholders begging for help—people who are going bankrupt and people who are being hit with high insurance premiums. We were told only last week of an insurance premium for a building that was £11,963 last year but £242,400 this year. People are being hit with bills of £6,000 each with seven days to pay them and no recourse to help. With waking watches, there are interim bills that are going through the roof. Leaseholders cannot pay this; they cannot afford this. The reality is that these buildings will not be made safe by transferring the financial and legal liability on to leaseholders. Leaseholders do not have the funds to fix it. As my hon. Friend the Member for Southampton, Itchen (Royston Smith) said, we, leaseholders and leaseholders’ groups do not want the taxpayer to pay; we want the taxpayer to provide a safety net to help. We believe that those responsible should pay—nobody else.
Nobody wants this Bill to fail. We are nearly four years on from Grenfell. The Minister mentioned Grenfell in his opening remarks. I would like to read him a statement that has been issued by Grenfell United:
“The fire safety bill is back in the commons. Government is using the excuse that the amendment will delay Grenfell recommendations. The amendment is to protect leaseholders from charges. The FSB is separate & it is wrong to claim support of it damages recommendations. Using Grenfell Recommendations to justify government’s indifference is deeply upsetting for us and shows they’d rather protect the corporates responsible from paying for the mess they created. Our request is simple: implement Grenfell recommendations make homes safe & protect lease holders from financial ruin. Nearly 4 years since Grenfell and yet not a single piece of legislation has been passed. Homes have to be made safe this is a basic human right. We ask all MPs that committed to ensuring Grenfell 2 could not happen to do the right thing today by us and the thousands of leaseholders effected.”
Grenfell United and the people affected there have spoken. Leaseholders up and down the country are speaking. Our constituents are speaking and Members of Parliament are hearing them. The Bishop of St Albans has tabled an amendment to try to provide the Government with the opportunity of the time and space to come forward with a compromise. I urge the Government to compromise and bring forward an amendment in the House of Lords later today to help support leaseholders.
I am extremely grateful for the opportunity to speak so early in this important debate. It is a pleasure to follow the hon. Member for Stevenage (Stephen McPartland). I thank their lordships for the tenacity and perseverance they have shown over many months in standing up for all the blameless leaseholders affected by the cladding crisis, including the many thousands who live in one of the more than 70 affected buildings in my constituency.
In seeking last week to persuade their lordships to cease insisting on amendments designed to protect all leaseholders from remediation costs, the Minister for Building Safety argued once again that such provision is unnecessary and that to continue to seek to amend the Bill in such a way would risk its passage in this Session, could increase fire safety risks and might “ultimately cost lives”. Yet it is the very fact that this crisis is already ruining countless lives that led their lordships to insist once again that this place reconsider, and they were entirely right to do so.
I agree with what my hon. Friend says. I wonder whether he has visited claddingscandalmap.co.uk, which maps 450 buildings with 60,000 homes affected by this scandal. It also shows the Members of this House who are voting to force leaseholders to pay towards the costs.
I thank my right hon. Friend for that intervention. I have seen the site in question, and it brings home—I know he shares my feelings, as his constituency is so close to mine—the fact that certain parts of the country with high numbers of new build properties, including constituencies such as ours, are particularly badly affected. I have tens of thousands of constituents affected.
As welcome as they were, the five-point plan and the additional grant funding that the Government announced on 10 February are still only a partial solution to the cladding crisis, and they consciously and deliberately leave a significant proportion of leaseholders exposed to costs they cannot possibly hope to bear. For significant numbers of leaseholders, that exposure is not some theoretical future risk, but a reality that they are already confronting.
To take just one example, I had a lengthy exchange yesterday with the right-to- manage directors of a small 24-unit building in east Greenwich, Blenheim Court, which requires urgent remediation and is under 18 metres in height. As things stand, not only are the leaseholders in question living with the punishing uncertainty of not knowing if or when their building might be issued with a forced loan of the kind the Government propose, but because they do not have the funds to commence remediation works, they are struggling with myriad secondary costs, including a soaring building insurance premium, which has led their service charges to increase from about £2,500 a year per flat to more than £130,000—I have seen the invoice, and the figure is correct—and there is a very real risk of mass defaults as a result.
Every week that this House fails to act, more leaseholders are placed in similar situations and put at risk of negative equity and bankruptcy. I have absolutely no doubt that the Government will ultimately be forced to bring forward a more comprehensive solution that protects all affected leaseholders from the costs of fixing both cladding and non-cladding building safety defects. Seeking to pass the costs on to even a proportion of them will almost certainly mean that the works simply do not get done. Unless this House is content to follow that path and see many more lives needlessly destroyed in the interim, it must act today and take decisive steps towards resolving this crisis.
I urge Ministers, even at this late stage, to honour their commitments previously given from the Dispatch Box and come forward with a sensible concession. If they do not, I urge MPs from across the House to protect blameless leaseholders and support the amendment in the name of the Lord Bishop of St Albans in the Division Lobby shortly.
I rise to speak to the amendments in my name. I am grateful for the support from all parties for them. I thank my hon. Friends the Members for Stevenage (Stephen McPartland) and for Southampton, Itchen (Royston Smith) for the work they have done on this issue.
We have to find a way forward. We cannot continue this sterile ping-pong between the two Houses of Parliament. We need an actual plan, and I believe that my amendments set out a workable way that the Government can take this issue forward.
There are three issues that need to be dealt with, the first of which is forfeiture. The idea that people’s properties can be repossessed because they have been unable to pay cladding costs, which are unjust in the first place, is abhorrent. We need to reform leasehold legislation to prevent that from happening.
Secondly, we need a proper plan for apportionment of costs, as I set out in the appropriate persons for fire safety order costs amendment. That means that taxpayers are not asked to write a blank cheque, and nor will those with responsibility have the ability to collapse a company so that they can avoid costs at a future date. We have got to ensure that the “polluter pays” principle is applied in this case.
The third thing we need is a real-time study, by the Department, to look at real people with real bills who are facing real negative equity and insurances issues, and who have difficulty accessing the building safety fund, given the narrow timescale and the fact that there are too few experts able to get them into that process. I therefore suggest the following.
How do we do this? First, on 11 May in the Queen’s Speech, we need to bring this issue forward in leasehold legislation, and deal with it once and for all. The Government have the ability to give us that assurance. Secondly, the long title of the forthcoming Building Safety Bill needs to be framed in such a way that we can deal with amendments relating to appropriate persons for fire safety order costs. That is also within the Government’s gift. Thirdly, if the Minister looks at my constituency of Portishead as a microcosm of the problems we face, he will see there are some buildings above 18 metres and some below; some have good management, some poor management. There are people with good copies of all the bills and who can tell a story to real officials in real time. All these things are possible. I set them out in the amendments as a route out of the sterile position in which we find ourselves.
We cannot simply continue passing this issue between the two Houses of Parliament. Our voters expect Parliament to come forward with solutions. We can find a genuinely practical way forward. We are two weeks from the Queen’s Speech. We can bring this legislation forward and enable the House to come together and provide solutions for our constituents in the way that they have the right to expect, and we have the duty to provide.
Four years have passed since the Grenfell tragedy, and once again the House is debating whether or not to protect leaseholders from the costs of remedying fire safety defects caused by a failure of regulation and negligence, as well as by deceptive practices in the building industry. Meanwhile, the Government continue to dither and delay, and order their MPs to vote against amendments designed to protect leaseholders. Make no mistake, the funds that the Government have made available thus far have taken too much time to come on stream. The money will not ultimately be enough to meet the scale of the crisis and, crucially, interim costs are not covered.
On top of all those costs, today we have heard about the cost of insurance. I have lost count of the times that I have pleaded with the Government to do something about insurance costs. In my constituency there have been insurance increases of 1,000% in affected buildings. Those are shocking figures, and this shocking situation is falling on deaf ears as far as the Government are concerned. Long before any cladding is removed from these buildings, the people living in them will have been ruined by the costs of insurance and interim measures such as waking watches to keep their buildings open. There is simply nothing left to remedy the internal fire safety defects as well. Leaseholders need the protection that the Lords amendment would offer.
We should never forget that at any point, a further tragedy could—God forbid—occur. That is a terror that leaseholders in Brindley House in my constituency have had to face, because on 31 January this year there was a fire in a flat in their building. I have seen the burned-out husk of that flat for myself. The fire service said that the residents were only two minutes away from the fire engulfing the whole of their building. Two more minutes and the windows in that flat would have shattered, and the cladding wrapped around that building would have caught fire. When I heard that, my blood ran cold. Can the Minister imagine what it must be like for the people who live in Brindley House? That is the risk, that is the fear, and that is the scale of the financial ruination that people in my constituency and all over the country are trying to cope with.
One of my constituents recently said to me that he now thinks it will be less stressful to declare himself bankrupt and become homeless than to try to find a way to carry on as a leaseholder. At the very least, the Government could and should support the Lords amendment, or indicate a clear way through the crisis, so that we send a clear signal to all leaseholders that we will stand with them.
I start from the principle that successive Secretaries of State and Ministers have said from the Dispatch Box that the leaseholders are the innocent parties in this scandal and that they should not have to pay a penny piece towards the costs of remediation. I applaud the Government for coming forward with £5.1 billion of public money to support the remediation of unsafe cladding, but our problem is that it is not enough. The estimate now is that £15 billion will be required and that the extra £10 billion will have to come from leaseholders as the last resort, because building owners will naturally pass that on to leaseholders wherever they possibly can. They are the ones in situ; they are the ones facing these huge bills.
The Government say that further proposals will come forward on the forced loan scheme. We were promised in the earlier statement in February that the loan scheme would be announced at the Budget. Now, I did make the assumption that that was the Budget in 2021, not the Budget in 2022 or 2023. The reality is that the evidence given to the Housing, Communities and Local Government Committee and other bodies suggests that the forced loan scheme is nowhere near being available. We as Members of Parliament are not even able to scrutinise the proposal, so those who are living in blocks of flats of six floors or less do not even know how that scheme will work. My estimate is that many people will end up with a bill that will last for 100 years, therefore factoring in, almost inevitably, a dramatic reduction in the value of their properties. Equally, we know that the fire safety remediation required in addition to the remediation of unsafe cladding almost dwarfs the costs of remediating the cladding. All those costs will once again be passed on to the innocent leaseholders.
I understand that my right hon. Friend on the Front Bench has to defend this position and clearly wants to get the Fire Safety Bill on the statute book. Let us be clear. I do not think any MP wishes to prevent the progress of the Fire Safety Bill. What we do need, however, is surety and assuredness, because the draft Building Safety Bill will almost certainly take 18 months to two years to bring to fruition. The leaseholders do not have that time to wait. My right hon. Friend the Minister has made it clear on a number of occasions that he finds the amendments defective. Well, there is still time. I agree with my right hon. Friend the Member for North Somerset (Dr Fox) that there is a solution. If the Government reject that solution, let them come forward with their own solution in the House of Lords. Let us agree that the leaseholders do not have to pay a penny and the Fire Safety Bill can go on the statute book, as we would all like to see.
The Minister should be very careful. The speeches in this debate today are an example of Parliament at its best and Government at their worst. The Minister has heard Members from across the House, and from his own party in particular, criticise what the Government are doing. He would be a very wise Minister to listen to Parliament. If he refuses to listen, I think he should think about his future.
In March this year, leaseholders in Wembley Central apartments in my constituency were told that in response to the publication by the Government of the Building (Amendment) Regulations 2018, a waking watch system would be implemented as soon as possible. The cost of the waking watch patrols would be recovered from leaseholders in the sum of £91,380 a month. The cost of the remedial works to the fire alarm system across Central Apartments, Ramsey House and Metro Apartments is estimated to be in the order of £250,000 to £300,000. The owners said that they were unable to say the total cost of all four recommendations and that they therefore could not advise the liability of each leaseholder.
I find it unacceptable that the Government are imposing billions of pounds of costs on leaseholders retrospectively to remedy misconduct by others, such as the developer, the builder or those producing the Government’s own advisory documents and in particular building regulations control. The fire survey for these particular buildings said:
“There is evidence that the junctions between compartment floors were inadequately fire stopped…as there were gaps at mineral wool fire barriers at steel framing. There were no visible fire barriers at vents or around windows/door frames and it could not be confirmed that the window/door frames themselves formed cavity barriers.”
That indicates that at the time of construction the building regulations then in force were not followed. That means that these people were sold a building that was not fit for habitation, yet the Government are not pursuing the people responsible; they are making sure that it is the innocent parties who will pay. Their lives are being ruined, as Members in all parts of this House have said. It is vital that the Government address this and accept the Lords amendment. In particular, they need to focus on addressing the very real issues in building control regulations that allowed this scandal to happen in the first place.
The Government’s plan and funding to address this fire safety issue are a welcome start. I am not going to rehearse the points already made this afternoon, but I believe that the role of affordable home ownership schemes in this disaster has been overlooked.
Many people engulfed in this scandal are first-time buyers who took their first step on the property ladder through Conservative-backed schemes intended to boost home ownership. People use these schemes because they are not cash rich, but they are now facing unexpected bills for life-changing sums, and some are being asked to take up further Government loans to pay them. The drafting of this Bill means that despite owning only part of the value of their flat, leaseholders are potentially liable for 100% of the share of the costs. In effect, they are subsidising their landlords, who own the remaining percentage of the value of the flat but pay nothing to remedy the defects. Leaseholders have always had to pay for the maintenance and upkeep of buildings they do not own, owing to the way leasehold agreements work, but the building defects and costs involved to fix them are beyond what anyone could have contemplated.
With your permission, Madam Deputy Speaker, I would like to read out a case study of a future constituent —someone hoping to relocate to my constituency. This individual owns a one-bedroom flat in the Olympic village in London, in which she has a 35% interest, and is seeking to move to Penzance, in my constituency, to be with her fiancé. The flat was sold to her as a low-risk investment; she was encouraged by the shared ownership Government scheme, as part of their affordable housing directive. Her block was found to have missing fire cavity barriers, rendering it a B2 rating, warranting remediation, with the bills potentially being in excess of £50,000 for her flat alone. The housing association is trying to bring the developers to account, something that legally it is not required to do. Failing that, this will result in a lengthy legal battle, during which she may well be presented with the bill for remediation work in order to make the block fire safe and adhere to the Government’s new guidelines. Applying for a grant under the Jenrick announcement for remediation works is an extremely slow and complicated process. If the housing association does not succeed in getting the perpetrators to fix their mess, she will get the bill, and as a shared owner she will be liable for the full 100% of the bill, not 35%, which is the share she owns of the property. In any case, it is highly unlikely she will be able to sell property for years to come and buy into the Cornish economy by purchasing a house.
My right hon. Friend the Member for North Somerset (Dr Fox) has put forward very pragmatic proposals to unlock the deadlock and improve the fire safety of homes across our nation, and I would welcome the Minister’s response to these sensible proposals,
Over the weekend, it was reported that the Bank of England is assessing whether Britain’s building safety scandal could cause a new financial crisis—why? It was because 1.3 million flats are unmortgageable and as many as 3 million people face a wait of up to 10 years to sell or get a new mortgage because they cannot prove that their homes are safe.
This scandal has gone on for too long and it has already caused too much damage. This Government must accept the Lords amendment that would protect leaseholders from exorbitant costs, or they should drop this Bill altogether and bring back a better version in the Queen’s Speech. It is simply incredible that the Government have had 10 whole months to break the deadlock and propose a solution that they find acceptable, but they have refused to do so. Instead, they wage a campaign of scaremongering, telling us that if the Bill fails it will have the effect of increasing fire safety risks. Well, that is not the view of the leaseholders in my constituency; it is not the view of the leaseholder group; and it is not the view of the Cladding Action Group. They are speaking with one voice and they are clear that they would much rather see this defective Bill fall than pass in its current form.
The devastating consequences of accepting the Bill unamended cannot be overstated. Millions of leaseholders who are already facing financial ruin through no fault of their own live with the terror of this Bill passing into law. If it does, they will be landed with even more extortionate bills, perhaps within a matter of days. The Government’s intransigence—their outright refusal to budge—is making the situation so much worse, to the point where I believe we now need an inquiry into the Government’s response to the fire safety scandal.
How much money have leaseholders already had to pay out? How many people have been driven to bankruptcy? How many have been made homeless? How many leaseholders have been pushed to the brink of suicide? Do the Government really think it is okay for 3 million people to have to wait up to 10 years before they are free to live in a fire-safe home? Do the Government think it is acceptable that leaseholders have no viable legal routes to challenge those who are responsible?
The cladding scandal and the fire safety scandal have been a protracted nightmare for leaseholders, and the Government’s failure to address the fire safety scandal properly is now a scandal in itself. I urge all colleagues to support the Lords amendment, because millions of homeowners are relying on us all to do so.
I support holding the Lords amendment. I think it is the right thing to do at the moment, although not because it is perfect—it is far from perfect and not without its flaws. My problem is that I do not see the Government responding to the overwhelming concern about what is happening to leaseholders, many of whom, as has been said before, were first-time buyers.
We face, today, an issue of concern both personal and public. The public concern is that the devaluation of these homes is now so dramatic that it will cause an economic shock. I remember the old negative equity problem that erupted as a result of a collapse, and I do not want to see us back there again. I accept that, as has been said, the Government have already put £5.1 billion into the process, but it is worth at least another £10 billion in settlement, and that is going to fall on the shoulders of leaseholders.
Let me relate what is going on in my constituency. Like everybody else, I have a set of estates, including Queen Mary’s Gate and Blackberry Court, among other blocks in my constituency. Many of them are under 18 metres and have cladding—this is the point that has been raised—that was not compliant at the time of their building. The leaseholders did not know that—they bought their homes with a sense that they were buying something that was right and reasonable—and are now not eligible for the safety fund.
What has happened because of all this? We have tried to get hold of the developer, Telford Homes, but it has not engaged for more than a year now. Telford Homes does not answer anything or engage about what it might do; it has gone to ground. That is the problem that lies at the heart of all this right now: there is no way that the leaseholders can get redress because they cannot go to those who did this wrongly at the time and the Government have not brought forward any mechanism to allow leaseholders to get after these individuals, who will sit there and wait for the leaseholders to waste their money.
The Lords amendment is not perfect, but I am trying to articulate a cry for help from my constituents and others around the country. I agree with and support the amendments tabled by my right hon. Friend the Member for North Somerset (Dr Fox). Let us find a way to make sure that those who were responsible stand up and pay the bill. They have made a lot of money in the past, legitimately, on building homes; those who did not put up the right cladding should automatically be in the frame. Meanwhile, the costs spiral and my constituents will pay them.
Today, for the first time, I shall vote to maintain and hold the Lords amendment. I say to the Government that if they do not want it, they had better get to the Lords and get us something decent that allows us to give support to our leaseholder constituents, because that would be doing the right thing.
I speak in favour of the Bishop of St Albans’ amendment. As the UK Cladding Action Group has previously reported, there have already been leaseholder suicides and, worryingly, 23% of those surveyed by the group have considered suicide or self-harm.
The Government must realise that the building safety fund only covers unsafe cladding, yet 70% of the buildings surveyed have non-cladding fire safety defects. They must understand that providing cladding remediation funding for buildings over 18 metres, yet forcing leaseholders in buildings under 18 metres to pay, is entirely unfair. They must recognise that there is no support available at all for interim measure costs, including increased insurance premiums and waking watches, which often run into figures of more than £15,000 per week.
To add further devastation, as we have heard today, Inside Housing has reported that even the minority of leaseholders who could apply for loans face a wait of potentially years. In the meantime, many residents still live in unsafe buildings and are understood to have already received requests for up-front payment, with freeholders sometimes instructing solicitors to carry out debt recovery. This could result in a tide of bankruptcies and evictions. The situation is so bad that I understand that analysts at the Bank of England are now assessing whether Britain’s building safety scandal could cause a new financial crisis.
It is clear that the Government’s approach is untenable and it must change today. Even the National Housing Federation states that the only way to prevent leaseholders and social landlords from having to pay to remediate buildings they did not construct is for the Government to provide up-front funding to remediate all buildings. I hope all MPs today can recognise the moral duty they personally have to protect our constituents and will vote in favour of the Lords amendment.
I had very much hoped that it would not be necessary for us to continue to have this debate in relation to this Bill. The core elements of the Bill are worth while and I support them. Unfortunately, however, it creates a set of potential liabilities upon wholly innocent leaseholders, without giving them an adequate means of redress. That is simply unfair. It is unfair on my constituents and it is unfair on people who have bought properties in good faith and who have relied on professional advice and the regulatory regime that was then in force. If there are people who were at fault, either in the construction of the buildings or in the way in which surveys were carried out, they should absolutely be held to account, but the people who should not end up with a liability are the leaseholders, who have acted in good faith throughout. It is the absence of protection for them that, regrettably, causes me to have to support the Lords amendment again today.
My right hon. Friend the Member for North Somerset (Dr Fox) tabled what I thought were constructive amendments, which I was happy to sign. I hope—still; even at this late stage—that the Government will see that there is a basis for progress to be made. As things stand, as my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) noted, we have to continue to press the case on the Government. I hope that, if the House rejects the amendments—I hope it will vote for the Lords amendments and deal with the matter—it will give the Government yet a further chance to resolve this matter.
At the end of the day, we are not asking that the taxpayer pick up the burden. We are asking that the leaseholders should be relieved, certainly in the short term, of the pressures that fall upon them and that they are unable to deal with. The Government are in a position to fund the cash flow that leaseholders cannot fund and which is driving them to desperate situations. It is absolutely right that they should then seek to recoup those funds from those who are responsible and who have been at fault. There is nothing in the Lords amendment or the amendments tabled by my right hon. Friend the Member for North Somerset that would prevent that from happening. I urge the Government to think again and recognise that, although the core elements of the Bill are good, collaterally, it does real injustice to innocent leaseholders, such as many in my constituency and elsewhere. For heaven’s sake, can we not find a constructive way forward to achieve the objectives of the Bill and protect innocent leaseholders? Those things should not be mutually incompatible, but at the moment we have not yet found a solution.
I actually think that the Prime Minister framed this debate well, because he told the House on 3 February that
“no leaseholder should have to pay for the unaffordable costs of fixing safety defects that they did not cause and are no fault of their own.”—[Official Report, 3 February 2021; Vol. 688, c. 945.]
Those were his words. No ifs, no buts—it was an unequivocal pledge. Clearly, the Government’s measures so far fall well short of fulfilling it. Today we have the opportunity to address that, because the Lords amendments make good on that failure.
I have spoken previously in the House about leaseholders in the Metis building, Wicker Riverside, Daisy Spring Works and elsewhere in my constituency who face a range of issues with ACM and other cladding, compartmentation, flammable materials wrongly used and other fire safety products. They are trapped in homes that are unsafe and unsaleable, facing bills that will break them—some up to £50,000 each.
Let us remember that we are talking about young people who stretched their budgets to the limit to buy their first home; couples unable to move on when they have their first child; others who cannot take new jobs because they cannot sell; and older people who have sunk their life savings into their flat and have nowhere to turn. They are being put under unbearable pressure and unimaginable mental strain. People have told me they fear collecting their post in the morning because of the bills it might contain. It is simply unacceptable. Today we can end that misery.
Those who say that the costs should not fall on the public purse are right. The developers responsible should pay up, as well as those responsible for failings in the building regulation system. The only way that developers and others responsible will be held to account is if the Government own the problem, urgently undertake remediation and then use the full resources of the state to chase down those responsible. Leaseholders simply cannot do it on their own.
We have that responsibility because successive Governments oversaw a flawed system of building inspections, which signed off so many of these unsafe buildings. These leaseholders are victims of comprehensive regulatory failure. There is a grave injustice here that must be remedied, and the Government must face up to it. Those responsible for the failings should be responsible for putting them right, without any costs falling on leaseholders, either now or in the future through loans schemes.
Many leaseholders have stretched their finances to the limit to buy their home. Some have already been bankrupted. Others are facing ruin. We have to put a stop to it today, so let us put aside other differences and do the right thing by accepting the Lords amendments.
I thank all hon. and right hon. Members for their contributions today. The House will know that we have a duty to implement clear and effective legislation to support fire and building safety reform. We have an obligation in this place to make good law. While I entirely accept that the motivations of all those who have contributed today are not to damage the Fire Safety Bill, I have to tell them that the practical consequence of passing the Lords amendments would be to do that, because they are ineffective and defective. Let me explain why, before moving on to some of the other points that Members have made.
The amendments would prevent any type of remediation costs being passed on to leaseholders, even if the cost was very minor or if the leaseholder was responsible for damage, and that is not a proportionate response. There is no framework in the Lord Bishop of St Albans’ amendment to distinguish between different works. I think all Members would agree that the taxpayer should not be paying for minor costs, such as replacing a smoke alarm, and that if the leaseholder is responsible for breaking a smoke alarm, in all likelihood they should fix it. The amendment is also unclear on who should take responsibility for remediation works until a statutory funding scheme is in place to pay or direct the costs, and that would result in remediation being delayed, even in the case of minor defects, if routes of cost recovery are unclear.
If my hon. Friend does not mind, I will not give way, because I have to conclude my remarks. Perhaps if I have a bit of time at the end, I will.
These orphan liabilities would leave leaseholders continuing to live in unsafe properties with no further clarity as to who will pay. It is important to ensure that taxpayers’ money is protected as much as possible and that remediation is not delayed unnecessarily in extended litigation such as we might find ourselves in. It is not the solution that leaseholders need or the one that the taxpayer deserves.
My right hon. Friend the Member for North Somerset (Dr Fox) has also tabled an amendment. It desires to provide greater clarity than perhaps other amendments do, but it also shares some of the defects of the St Albans amendment. It applies to any form of remediation, including wear and tear, and there is no cost threshold on what works should not be considered. Moreover, the amendment also provides that the Home Secretary will essentially be acting in a quasi-judicial role to adjudicate whether appropriate parties should pay costs of remediation. My right hon. Friend the Home Secretary will find herself apportioning liability for any building with two or more dwellings on a building-by-building basis for any possible cost associated with the fire safety order. That would take years. Leaseholders may be unable to sell or move until their building has been considered. Without much more clarity on how these decisions are to be made, the Government themselves could be open to judicial review, slowing down important implementation of policy and diverting taxpayers’ money towards litigation once again. We believe that we should seek to keep these decisions on liability in the hands of the courts, not those of politicians.
However, there are points on which we agree. That is, for example, on the principle around forfeiture. It is a draconian measure that should be used only as a last resort. This matter should be considered as part of our wider programme on leasehold reform that we have already indicated. Adding it to the Fire Safety Bill purely for fire safety order costs will create a tangle of loopholes and potential for satellite litigation.
My right hon. Friend the Member for North Somerset also talked about the apportionment of costs. He will know that the Government have announced a consultation on a tax measure on the development sector to ensure that the developers—those with the broadest shoulders—pay their way. We reckon that that will yield at least £2 billion over the period. Of course, we will want to keep that under review so that we can ensure that those who ought to pay do pay and that taxpayers and leaseholders are protected as far as they possibly can be. He also asked us to assure him that we will consider his own constituency case. I am very happy to commit, as my hon. Friend the Secretary of State has done, to look at that constituency matter to see what we can learn from the case study in North Somerset.
In conclusion, these amendments are defective, and I am afraid I have to ask the House to respectfully disagree with their lordships and reject their amendments.
Question put, That this House disagrees with Lords amendment 4J.
Lords amendment 4J disagreed to.
The list of Members currently certified as eligible for a proxy vote, and of the Members nominated as their proxy, is published at the end of today’s debates.
Motion made, and Question put forthwith (Standing Order No. 83H), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendment 4J;
‘ That Christopher Pincher, Tom Pursglove, Scott Mann and Chris Elmore be members of the Committee;
That Christopher Pincher be the Chair of the Committee;
That three be the quorum of the Committee.
That the Committee do withdraw immediately.—(Maggie Throup.)
Question agreed to.
Committee to withdraw immediately; reasons to be reported and communicated to the Lords.
On a point of order, Madam Deputy Speaker. It will be observed that the Government’s majority without the Scots Nats was halved in the last vote.
I would not ask for guidance from the Chair in the Commons about procedure in the Lords, but were the Lords to send back another amendment different from the one we have been considering, but trying to take up the points raised in this Chamber, am I right in saying that the Government could table their own amendment tomorrow, which would absorb the points made in this House, so that leaseholders are not penalised in the way they would be if the Bill went through as it is at the moment?
(8 months, 3 weeks ago)Commons Chamber
Consideration of Lords message
[Relevant documents: Second Report of the Housing, Communities and Local Government Committee, Cladding: progress of remediation, HCV 172, and Fifth Report of the Housing, Communities and Local Government Committee, Pre-legislative scrutiny of the Building Safety Bill, HC 466.]
After Clause 2
Prohibition on passing remediation costs on to leaseholders and tenants
I beg to move, That this House disagrees with the Lords in their amendments 4B, 4C, 4D and 4E.
I thank all right hon. and hon. Members for engaging in this very important debate, both now and throughout the passage of the Bill. I particularly thank my hon. Friends the Members for Kensington (Felicity Buchan), for Ipswich (Tom Hunt), for Rochester and Strood (Kelly Tolhurst) and for Wimbledon (Stephen Hammond), and Members across the House, for the keen interest they have shown in this matter. I will keep my opening remarks short, as I know that many Members are keen to contribute, and I shall wind up later on.
The Government remain steadfast in their commitment to delivering the Grenfell Tower inquiry phase 1 report’s recommendations. This Bill is an important first step in delivering those recommendations. The Government have always been clear that all residents should be safe and feel safe in their homes. That is why we will be providing an additional £3.5 billion to fund the removal and replacement of unsafe cladding on residential buildings.
Will the Minister give way?
I will give way to the hon. Gentleman later on; let me conclude my initial remarks.
This will be targeted on the highest-risk buildings—that is, those buildings over 18 metres tall that have unsafe cladding. The scale of this investment should not be underestimated, with over £5 billion of taxpayers’ money, and more when the developer levy and the developer tax are taken into account. We have an ambitious timescale to ensure that remediation of unsafe cladding is completed at pace. We are also now seeing tangible progress from the Royal Institution of Chartered Surveyors revising its guidance on EWS1 forms, lenders committing to adhering to RICS guidance, and more developers now allocating significant funds for remediation.
As parliamentarians, we have a duty to implement a clear framework and transparent legislation to support fire and building safety reform. I am afraid to say that, despite the best intentions of these Lords amendments—I absolutely accept the sincerity with which they have been posited—they are unworkable and impractical. They would make the legislation less clear, and they do not reflect the complexity involved in apportioning liability for remedial defects. I have had extensive conversations about the effects that the amendments might have with my hon. Friend the Member for Rochester and Strood, who has pressed me hard on this, as have others. These amendments would also require extensive redrafting of primary legislation, resulting in delays to the commencement of the Fire Safety Bill and to our overall programme. They could also have unintended and possibly perverse consequences for those that the amendments are intended to support, and we would still be no further forward in resolving these issues.
I shall give way to the hon. Member for Cardiff South and Penarth (Stephen Doughty) when I return to speak later, but let me say in concluding my opening remarks that we cannot accept these Lords amendments and we encourage the House to vote against them and for the Government amendments.
I am pleased that so many Members have put in to speak today. I will keep my remarks fairly brief, but I want to make three points. First, thank goodness I am not standing at this Dispatch Box again and pleading with the Government to agree at the very least a timetable to implement the vital fire safety measures from the first phase of the Grenfell inquiry. I am pleased that the Government have agreed in the other place to Labour’s suggestion of a timetable. Before the second anniversary of the Grenfell phase one recommendations, the Government have committed to regulations to implement them, and that will be by October this year. They said that this would delay the Bill, that it would be too complicated and that it would be too hard to do, but they have now agreed to a version of it. It is not quite what we wanted, but it is something close.
I have lost count of the number of times we have voted on the Grenfell recommendations and the number of times we have been pushed back, and it is quite extraordinary that the Government have taken so long to get us here. Labour’s previous amendment, which the Government have now agreed on a timetable to deliver, would do four things: the owners of buildings that contain two or more sets of domestic premises would share information with their local fire and rescue service about the design and make-up of the external walls; they would complete regular inspections of fire entrance doors; they would complete regular inspections of lifts; and they would share evacuation and fire safety instructions with residents and the fire service. These measures are straightforward and are supported by key stakeholders.
In the Minister’s letter that sets out details of the Government’s concession, he wrote that the Government would lay regulations to make responsible persons produce and regularly review evacuation plans for their building. The Grenfell recommendation, and our amendment, said more than that. They said that that information should also be shared with local fire and rescue services and residents. I would like the Minister to clarify in his closing remarks who these evacuation plans will be shared with and how this will be enforced, but I am grateful to him for seeing sense and heeding our calls to do the right thing, because it has been ages.
I come to the second point that I want to make. It has been nearly four years since 72 people so tragically lost their lives in the Grenfell Tower fire. In those four years, Grenfell United, the families, the survivors and the entire community have fought tirelessly for change. It is thanks to their hard work and dedication that the Government have finally agreed to implement the recommendations by October 2021. I pay tribute to them and their ongoing fight for justice. I pay tribute to our firefighters who keep us safe every day. We know that cuts to their service have hit hard—response times are inevitably affected, and morale is affected—and now they have a pay freeze, which is no way to thank them for going above and beyond during the covid pandemic.
I come to my third and final point. Leaseholders should not have to fund the cost of fire safety remediation works when they are not to blame and they are the least able to pay.
I wholeheartedly agree with my hon. Friend on that point, as she well knows, because of the leaseholders who are affected in my constituency. While the Welsh Government have put forward an additional £32 million in their new Budget for this very issue, leaseholders in Wales are still in the dark from the Government’s announcements about what moneys there will be for Wales and how the levy and tax will work. Does she agree that the Government should sit down with the Welsh Government Housing Minister and sort this out for the benefit of all leaseholders?
I thank my hon. Friend for that intervention. I have a sense of déjà vu, because we have been saying all this for some time, as have Members across the House. Of course the Government should sit down with the Welsh Government and work out whether any of this funding will go to Wales and how that will work.
My hon. Friend is making a powerful point about the needs of leaseholders. Does she agree that, as well as dealing with the gaps in the support so far announced, it is vital that there is much more clarity on what leaseholders should be entitled to—particularly those in shared ownership arrangements, where the quality of work done and the relationship with the social landlord can vary? This is causing them great confusion and anxiety and, indeed, great difficulty in selling their properties.
My hon. Friend makes a very good point. The plight of people in shared ownership properties is dire and needs to be looked at by the Government, as does the plight of the many thousands of people who are still trapped in unsafe buildings or buildings they cannot sell, who face extortionate bills for remediation work or who face huge increases in insurance and waking watch costs and other costs that they simply cannot afford. People are going bankrupt.
We cannot feel it in this place, but every time we have a debate or a vote on this issue, thousands of people write to all of us and say, “We are hoping against hope that you do the right thing this time.” We have people writing with heartfelt pleas. Their stories are stark, and every time we have this conversation, people’s hopes are raised, and there is a groundswell on social media and in our inboxes of people saying, “Maybe now the Government are going to do the right thing.” They are watching us now, hoping that we are going to do the right thing. It is very sad that the Government are indicating at the moment that they are not going to take this issue seriously.
This is taking a heavy toll on people’s mental health and putting millions of lives on hold. Leaseholders have been trapped in this impossible position for too long. Throughout the passage of the Bill, we have continually campaigned on this issue, and we welcome the latest amendment from the Bishop of St Albans. Like Labour’s previous amendments and those tabled by Members on both sides of the House, this amendment would prohibit the cost of replacing unsafe cladding being passed on to leaseholders or tenants.
In February, the Housing Secretary told thousands of people across the country that they will be locked into years of debt to fix fire safety problems that were not their fault, and we hear that the Government have decided to lay a motion to disagree with the Bishop of St Albans’s amendment. That is a direct and deliberate betrayal of the promise that Ministers have made over 17 times that leaseholders should not be left to foot the bill. Over the weekend, I wrote to Members of Parliament across the House who have constituents affected by this, urging them to back the amendment, and I sincerely hope that together we will stand up for the rights of leaseholders today and all Members will do the right thing. Given the risk of fire and looming bankruptcy, we cannot wait while the Government delay with inaction and failed proposals to keep leaseholders out of debt.
Today is another chance for the Government finally to put public safety first and to bring forward legislation to protect leaseholders from the deeply unfair situation of paying for fire safety repairs for which they are not responsible. Members across this House are united on this issue and are determined that innocent leaseholders should not foot the bill. Today should be the day when people across the country can go to sleep with a great sense of relief that the Government have listened and put into law protections for leaseholders, so I sincerely hope that the Minister will change his mind. It is not too late for the Government to do the right thing and protect innocent leaseholders across the country.
There is not the time to say what the Government have done for leaseholders. The Fire Safety Bill, in the form the Government want to return it to, if they get the House to reject the Lords amendments, would place an automatic, unchallengeable financial burden on residential leaseholders in building safety remediation costs, even in circumstances where a lease may have excluded such an obligation. I refer the Minister, if he has time, to the article by Martina Lees in The Sunday Times “Home” section about some of the building costs that are not justified.
The bishops’ amendments are intended to protect leaseholders from being solely responsible for the costs. The Bill strengthens the landlords’ and freeholders’ legal rights over leaseholders. The amendments provide for more balanced liability for costs. These Lords amendments should not be overturned. The alternative, which the Government are asking us to agree, wrongly and disproportionately disadvantages innocent leaseholders. Many are unable to pay, and they are frightened.
This is a Home Office Bill, and the Home Secretary gave this as her reason for rejecting previous Lords amendment 4:
“Because the issue of remediation costs is too complex to be dealt with in the manner proposed.”
I say, and I think people on both sides agree—and probably the Minister does so privately—that what is being proposed cannot be supported. It is too simple: it loads costs on leaseholders, who are the only people who cannot be responsible for putting right a building that they do not own and will never own, and of which in legal terms they are only the tenants.
I ask the Minister to ask his colleagues to let him agree to accepting these Lords amendments, and to let the leaseholders free.
I support the Lords in the message it has sent back. The Lords is proposing very important changes to the Government’s position. First, not just leaseholders but tenants should not have to pay. For example, in a block where the social housing provider is the freeholder, according to the Government’s proposals, leaseholders would not have to pay, but social housing tenants—if it is not ACM cladding that is being removed—would have to pay through their rents for the removal of cladding. That tenants have to pay and leaseholders do not simply cannot be right.
We are not quite sure what costs leaseholders in blocks under 18 metres will face, because there is still an awful lot of vagueness and lack of clarity about what the Government’s loan scheme will actually mean. When the Minister for Building Safety and Communities came to our Housing, Communities and Local Government Committee recently, he said that leaseholders would not be responsible for paying the loan, but neither would freeholders; the charge would be on the building. A building cannot be legally responsible for a charge on a loan placed on it. Some organisation or some individual has to be responsible. Is it the freeholder? Is it the leaseholder? There is an awful lot of unclarity about that, and about how we limit leaseholders’ charges to £50 a month. There is a great deal of confusion. The Government are still working that through, so as things stand there cannot be an absolute assurance that leaseholders will not have to pay on blocks of under 18 metres.
Finally, there are issues other than cladding. It is not just that cladding will have to be taken off; very often, the cost of doing other fire safety work on blocks of flats is greater. Again, we were told that if the other work is associated with the removal of cladding, it will be covered by the Government’s financial help. If insulation is a composite part of a building’s structure along with the cladding, presumably it can be removed, as it is associated with the cladding. However, if the insulation is completely separate and distinct from the cladding, the Government funding might pay for the cladding removal but not the insulation removal. Very often, leaseholders simply cannot afford to pay for that, but the Government will not allow any of their funding to go ahead unless the leaseholders can find the additional costs.
None of those positions is acceptable. I support a position where neither leaseholders nor tenants are asked to pay to make their buildings fire-safe.
I thank the Lord Bishop of St Albans and the Lord Bishop of London for ensuring that we have the opportunity to vote on the amendments today. It gives us the chance to divide the House on whether leaseholders should be responsible for paying for historical fire safety costs. I urge the Minister and the Government to accept the amendments or, if there is something wrong with them, to table their own. They should work with us and with leaseholders to try to resolve this issue.
It is unacceptable that people feel that we want taxpayers to pay. Leaseholders do not want taxpayers to pay and Members across the House do not want taxpayers to pay; we want those who are responsible to pay—the developers, the insurance companies and the building regulators who said that these properties were safe over the past 20 to 30 years, when many of the leaseholders who will be forced to pay these bills were in primary school or not even born. It is not acceptable, it is not fair and it is not right. What we are doing today is shameful.
The amendments would maintain the status quo with regard to the costs of remediation. I understand the Minister’s point that this is a small Bill and not the right place to deal with the costs of remediation. I agree with him, but it is he who is transferring the liability to leaseholders in this Bill. The status quo is that leaseholders are not responsible for the costs of anything to do with external walls or doors. It is this Bill that amends the legislation. It is this Bill that will make leaseholders responsible for paying for historical fire safety defects. Again, that is not fair.
I was at a building today and it became clear very quickly that the estimated costs of remediation are greater than the value of the properties within it. Can the Minister give me an answer? What will happen in cases where the costs of remediation are greater than the value of the building and the properties within it? Will the building be written off, like an insurance company would write off a car? Will those people be made homeless? We know that if the Bill goes through, even more leaseholders will face bankruptcy and huge issues of homelessness.
At the moment, the interim costs are bankrupting leaseholders up and down the country. Leaseholders are screaming for help; they are screaming in pain. And what are we doing? Today, we are saying to them, “Thanks for paying the interim costs. Once you’ve finished that, we’re going to load you up with the remediation costs on top.” That is tens of thousands of pounds that people just do not have.
We are nearly four years on from Grenfell, and it appears to me that the Government have given up on those who should be responsible for paying and are pushing the costs on to leaseholders. It is morally unacceptable.
I will be supporting the amendment moved by the Bishop of St Albans, because in circumstances where leaseholders are beset by worry, fear and uncertainty, it will provide them with the reassurance that they will not have to pay to fix a problem for which they are not responsible. It will also make the Government realise that they have to come forward with a different solution.
There are two problems here: the first is dangerous cladding and the second is other fire safety defects, which have been discovered in building after building. The Government appear to be in the position where the funding they have announced will pay for the remediation of missing fire cavity barriers where they are integral to the replacement of dangerous cladding, but not where they are not—in other words, where they are elsewhere in the building. I do not really understand that. Can the Minister say whether, if the works the Government are prepared to fund through the scheme are completed, the buildings in question will be declared safe so that the waking watch and insurance costs disappear even if the other fire safety defects have not been fixed?
Time, however, is not on our side, because we know how long making all of these homes safe is going to take, even if all the necessary funding had already been identified.
There are detailed inspections to be done, tenders have to be put together, firms found who are willing to do the work, and scaffolding and building materials have to be ordered before the work can even begin. So, given the scale of this, it is going to take a long time. But that is the one thing that leaseholders do not have, because, as we have heard, they are paying bills that they cannot afford.
Even worse, the bills are now starting to arrive on their doormats demanding payment to fix the cladding. One recent example was a demand for £71,000. It might as well be for £1 million, because there is no prospect of leaseholders being able to find that kind of money.
So the longer this goes on, the more likely we are to see leaseholders becoming bankrupt. What are the local authorities going to do when they turn up at their door and say, “I’m homeless; I need somewhere to stay”? And make no mistake: the anger that leaseholders are feeling at the moment will be something else again when they find themselves being made homeless through no fault of their own.
So, let us do the right thing today to protect leaseholders, and then the Government can turn their attention to finding an answer that will actually work. At a time when people are getting bills to the tune, as I have just said, of £71,000 through the letterbox, to stand up and say, “I’m really sorry, but this isn’t the right legislation” demonstrates a failure to understand the nightmare that so many of the people we represent are living through.
First, may I put on record my thanks to the Lord Bishop of St Albans and the Bishop of London, without whom this amendment would not be back here tonight?
Not to try to outdo the right hon. Member for Leeds Central (Hilary Benn), in my hand this evening I have an invoice. It is an invoice for service charges and remediation of fire safety defects; it is an invoice for nearly £79,000. Imagine for one moment you are trapped in a flat you have been told is unsafe. Night after night you go to bed with the fear of fire. You cannot sell your flat because it is worthless. Everyone knows that none of this is your fault, but then an envelope drops through your letterbox. When you open it, there is a bill for £78,000 to put defects right that are not of your making.
I am asking Members across the House to vote tonight to agree to the Bishop of St Albans amendment—better, or formerly, known as the McPartland-Smith amendment to the Fire Safety Bill. I am asking them to vote with us tonight because bills like this one have already started to arrive and they are not going to stop. Everyone knows what is happening, and if they do not they should open their emails and read the heartbreaking experiences of their constituents. This is not politics; it is not ideology—in fact I do not know what it is, but is it any wonder that some leaseholders feel that there is some sort of a conspiracy against them?
Are we going to let the innocent continue to pick up the tab for the guilty? What are we doing about the developers, the contractors and the manufacturers? What are we doing about the insurers and the National House Building Council? What are we doing about local authority development control and others that signed off these buildings as safe? Are they sleeping soundly in their beds tonight?
There is an economic reason for voting for the amendment, and there is a political reason for voting for it, but beyond that there is a moral reason. If this Bill becomes law, we will be abandoning hundreds of thousands of innocent people, and I am not going to have that on my conscience.
I am grateful for the opportunity to speak this evening. I have been contacted by and met hundreds of concerned constituents, many of whom are trapped in unsafe leasehold properties. I have also met Clad DAG, a group set up to ensure the voices of disabled leaseholders are heard, and I hope the Minister will also meet them. Many of those I have spoken to bought their first home through Government schemes that they believed would help, rather than hinder, them. They now wish to move on, but are instead facing bankruptcy due to astronomical bills. Understandably, they want to know why those who should be taking responsibility are not.
Let us look at the example of Berkeley Homes and its subsidiary St James. Unlike other developers and housing providers in the constituency, the chief executive officer of Berkeley Homes has refused three times to attend public meetings that I have organised, or to answer leaseholders’ reasonable questions about remediation costs. The company remains in dispute with the owners of Aragon Tower in Deptford about whether the fire breaks in the building are faulty. Meanwhile, more than 160 residents are fearful of what might happen while they are asleep.
The stress of paying for remedial works is particularly acute for leaseholders in shared ownership blocks, including Norfolk House in Deptford. Residents do not qualify for the Government’s new cladding grants, as their building is under 18 metres. They therefore face having to pay back costs at £50 per month. The estimated total for removing the cladding is £3 million, meaning that residents would have this debt hanging over their heads for many years to come. On top of that, they are facing additional fire safety charges, including for a waking watch. The cost of that, to be billed from September, is a staggering £74,000 a month. Many constituents are also finding that banks will not lend on properties without external wall survey certificates, despite Government advice that the document is not a legal requirement. Just as the country faces another financial crisis, leaseholders will be forced into higher mortgage rates for homes that in many cases are no longer suited to their needs. The Financial Conduct Authority merely suggests using mortgage intermediaries. Ministers promised on at least 15 occasions that cladding costs would not be passed on to leaseholders, yet for years they have failed to deliver. Tonight, I call on the Government to support those amendments that would absolve leaseholders from bearing the costs of a crisis not of their making.
Nearly four years after Grenfell, it is very disappointing that the Government still have not finalised support to make people’s homes safe, and that leaseholders are still waiting for the protection that Ministers promised multiple times, and that the Lords amendments could help deliver.
I am in touch with more than 3,000 households affected in my constituency, and hundreds of leaseholders have completed my online survey. These are people left in limbo by our Government, but already facing the cost of service charges or waking watches. There are also those facing costs where there is an uncertain timeline for the work. Seven out of 10 people who completed my survey said that works had been identified as necessary but they had yet to get the date for repairs. There are also people whom the Government deliberately excluded from help with compartmentalisation safety measures, and people living in buildings less than 18 metres tall. I am working with people living in 28 such buildings, and with people who have seen delays in Government action, despite the Government having failed to ensure that regulations meant that house building and renovations were safe. Of course, other people have seen Government guidance needlessly affect their insurance or mortgage.
Today, I am supporting the Lords amendments, but I am also asking the Government not to profiteer from this situation. I am seeking, with cross-party backing, including from the hon. Member for Southampton, Itchen (Royston Smith), who has already spoken, a VAT exemption on essential works required through fire safety surveys, in line with VAT changes made three years ago for some new builds. If that measure is adopted, the Government’s building safety fund will go 20% further, as money will not be lost to VAT. That fund goes on not luxury changes, but essential remedial works required by the Government to make people’s homes safe. Put simply, we cannot go from dishy Rishi eating out to help out last year, to rip-off Rishi profiteering from people’s misery today. I hope that this cross-party request will gain further support, and that Ministers will meet campaigners on this issue.
It is a pleasure to follow the hon. Member for Bermondsey and Old Southwark (Neil Coyle). The Government have moved swiftly to try to remediate the cladding on tall buildings. There has been slow progress, but progress is being made. In medium-rise buildings—those below six storeys—leaseholders will have to bear a cost, but we do not know what that cost will be, and we do not yet know the results of the proposals for the loan scheme. It is quite clear that the Government are trying to find a way forward, but we have yet to see the details.
There is also the issue of fire safety in buildings. The Bill is vital to preserving fire safety across the country in all buildings, whatever their structure. The Grenfell inquiry lifted the lid on the scandal of the tall buildings erected in this country without following proper fire safety regulations. Once a survey is carried out on a building, we know the extent to which work is required, whether regulations were followed, when the building was put up and whether the materials used in the building were correct. The people who provided substandard materials should be made to replace them free of charge. If builders put buildings up without following the proper regulations, we should go back to them and required them to carry out the remediation.
The one set of people who are completely and utterly innocent is the leaseholders. They did not build their building; they bought their lease in the belief that it was safe and secure. We should send out the strongest signal tonight that leaseholders should not have to pay a penny piece towards the cost of remedying things that were not their fault.
The Minister may say that the Bill is the wrong place to put that provision, but it will take at least 18 months—possibly two years—to bring the building safety Bill to fruition. Leaseholders do not have time to wait for us to deliberate, so let us join together and send the signal that leaseholders do not have to pay a penny. If the Government believe that Lords amendment 4B is somehow flawed, let them come forward with an amendment that is satisfactory and will result in the key outcome: not requiring leaseholders to pay.
I am pleased to see the Bill back before us, and proud that it was an amendment that I tabled last June in Committee—new clause 3—that first introduced the principle that leaseholders must be protected from the extortionate costs of fire safety remediation. I am very grateful to my noble Friend Baroness Pinnock for taking up the idea in the other place, and to the hon. Members for Stevenage (Stephen McPartland) and for Southampton, Itchen (Royston Smith) and the Lord Bishops of St Albans and London for improving it along the way.
The arguments for and against protecting leaseholders in the Bill are now well established. The Government continue to attempt to fob us off with the inadequate and flawed remediation fund, but fire safety experts have debunked the fund’s arbitrary 18-metre cut-off. Meanwhile, leaseholders keep trying in vain to tell the Government that it is not just about cladding; buildings of any height would still be left liable for non-cladding remediation of missing fire breaks, flammable balconies or dangerous insulation, as well as having to pay for waking watches and additional alarms.
I have listened with interest as Ministers continue to reject the amendment. We hear time and again that it is not sufficiently detailed, that it would require substantial drafting of primary legislation and that it could cause litigation, delay remediation work and have unintended consequences—that is a new one. The Government claim that it is Members who back the amendment who are apparently responsible for causing delays to the Bill, when it is the Government who have taken almost four years to bring forward a two-page Bill. Not once have the Government acknowledged the risks of the Bill passing without the amendment. Not once have the Government addressed the fact that financial costs will be incurred by leaseholders from day one if the Bill goes through without the amendment.
The Government have spent nine months finding fault with the amendment, but at no point have they brought forward their own. Leaseholders cannot rely on the flawed building safety fund, nor can they wait any longer for promises of hope in a building safety Bill that may or may not help in the future. Ministers can see the strength of feeling in this House, even among those on their own Benches, and they can hear the pleas from millions of desperate homeowners. This amendment may not be perfect, but it is the only proposal on the table to protect leaseholders from the financial repercussions of fire safety defects that are not of their making. I call on all Members to do the right thing and support it.
I understand why the Government will not accept the amendment, and I do not want to go there again, but what we need is urgency. Time is not just money; it is also worry, anxiety and uncertainty, and I echo the points made in one of the many excellent letters from my constituents in Portishead on this. It says: “It is not right that leaseholders have to worry about the costs of fixing safety defects that we did not cause.” We all agree with that; the question is who should pay. If the costs are a direct result of legislative change made by the Government, it is reasonable for taxpayers to contribute to that. If they are not, builders and insurers should pay, including for non-cladding related defects.
The second point that my constituent makes is this: “We recognise that the additional £3.5 billion announced by the Secretary of State is a step forward and we do welcome this funding. We are still awaiting the full detail of this funding announcement, as well as that of the proposed loans for medium-rise buildings.” In the last debate, we were told that more details would be forthcoming after the Budget. It is after the Budget, and we have still not had the details we are looking for, and these are real-time problems for which our constituents require real-time solutions.
My constituent goes on to say that “providing funding for buildings over 18 metres while forcing leaseholders in buildings under 18 metres to pay via a loan scheme is entirely unfair, because building height alone does not determine fire risk.” We understand that, and again it is about appreciating that there needs to be a cut-off to stop taxpayers having to sign a blank cheque, but the cost for remediation should be met by those who are actually responsible for the problems in the first place.
The final problem that my constituent raises—it has been raised so often in this debate and previous debates—is negative equity and the difficulty of resale, which is causing immense distress. It can be a major generational problem for people who are looking to sell or downsize. It can cause them a great deal of anxiety. We have heard that the market should sort it out, as we would normally expect, but we are still waiting for elements of that that the market would normally regard as being necessary.
I will not, because time is short and so many Members want to get in; I apologise to my hon. Friend.
Last time, I asked what direct contact Ministers had had with the Association of British Insurers, the building societies and the banks, because without their help, we are unable to deal with the negative equity and resale problems that are at the heart of so much of the distress we find. I know from talking to so many of my constituents about this issue that they appreciate that the Government have already come a long way. They are very grateful for taxpayer support. The problem is that we need more details, and for real-time issues, we need real-time solutions. Urgency is the key.
I am grateful to colleagues in the other place for the opportunity to reconsider amending this Bill. I also thank the hon. Members for Stevenage (Stephen McPartland), and for Southampton, Itchen (Royston Smith), for their perseverance in holding the Government to account over this cladding scandal.
Much has been said in this Chamber about why leaseholders should be protected from fire safety remediation costs, and I could repeat the long list of powerful arguments that colleagues from across the House and I have put to the Government, but instead I draw on the experiences of those whose voices are not often heard in this debate, and in particular want to mention the problems faced by disabled leaseholders. I pay tribute to the work of the Leaseholder Disability Action Group in highlighting them.
For many disabled constituents in Vauxhall, the difficulty finding accessible homes in London means that, where possible, they choose to invest in a property that they view as a potential property for life.
In many instances, shared ownership with a housing association is an affordable option for those who do not have enough for a large deposit or even a mortgage. Many disabled leaseholders will have spent thousands of pounds adapting their flats to suit their needs, including with bathroom and kitchen adaptations, which will often have been funded through local authority disabled grants. But like so many leaseholders caught up in this crisis, they are now facing the additional burden of remediation costs, on top of other fire safety measures, putting them at risk of bankruptcy and losing their home for life. What is more, we know that disabled people are less likely to have the savings or income to meet unforeseen bills, and these are all subject to means-testing. This cannot be right. The important amendment before us this evening would help to end this nightmare for all leaseholders, so I urge all colleagues across the House to join me in voting for it.
There is a simple question for the House to consider today: should leaseholders be forced to pay for essential remediation works that they are compelled to undertake to their properties that have come about through no fault of their own? The only possible answer is no.
We know that the cladding calamity that has befallen so many of our constituents did not come about because leaseholders have failed in any way. All the costs that are attributable to the cladding scandal are down to failures by developers and successive Governments, who have presided over shocking, scandalous regulatory failure, which has pushed thousands of wholly innocent people to the brink of financial ruin.
We all know that the costs of the regulatory failure that has created this crisis are in the many billions of pounds, but they must not fall on the ordinary people who are not responsible for this mess. There are other ways, I believe, that the Government can raise the necessary money. They should introduce a levy on developers and the construction industry to fund the cost of remediation —both cladding removal and remediating the many other fire risks that many of us in the House have been raising for quite some time.
The Government should also strengthen procurement regulations so that local authorities and metro Mayors can prevent developers and construction companies that are failing to live up to their moral obligations and put right the fire hazards that they are responsible for creating from bidding for any further publicly funded development contracts. In that way, we can reward those who are doing the right thing and putting right the cladding issues in the buildings that they were responsible for putting up and, hopefully, force a rethink on the part of those who are failing to live up to their responsibilities by preventing them from bidding for further taxpayer-funded contracts.
But what is clear is that the Government must not pin the spiralling costs of this crisis on the ordinary people who are currently facing financial ruination. I urge all Members to keep the amendment tabled by the Bishop of Saint Albans in the Bill, because to do anything else is a dereliction of our duty. This House must do the right thing by leaseholders this evening.
I draw the House’s attention to my entry in the Register of Members’ Financial Interests.
The first thing to say is that I agree with many of the comments that have been made. It simply cannot be right that leaseholders are faced with bills of tens of thousands of pounds. Nevertheless, I cannot support the amendment because I do not think it is effective, for a number of reasons. First, it seems to put somebody—an indeterminate person—on the hook for fire safety remediation forever. As I read it, it is not limited to historical defects.
I am grateful to my hon. Friend. I want to ask him this simple question, which I am sure he will appreciate. We have been back here three or four times now to discuss this, over and over, and every time I have said that if the amendment is defective, the Government should make it work and have it as their own. Does he agree that that is the way to go?
After the previous debate, I offered my hon. Friend the opportunity to sit down and look at an amendment that might work, in concert with the Government.
The other difficulty with the amendment is that it would put the onus back on a building’s freeholders. Many people would say that that is fine—that it is better than the leaseholders having that responsibility—but I do not think it would put the leaseholders in a better situation, because the freeholder would simply close down the company and hand back the responsibility, which would fall back on to the leaseholders. I simply do not think the amendment works.
I have a couple of general comments. I was a member of the Housing, Communities and Local Government Committee at the time of the Grenfell tragedy, and the first thing for which we campaigned—straightaway, like many Members in this House—was a complete ban on combustible cladding. That is exactly what the Government stepped in to do. Of course, that ban is prospective, and it left a retrospective issue. The Government have clearly stepped in on the retrospective issue of cladding on high-risk buildings, which is exactly what the Select Committee campaigned for—those 1,700 high-risk buildings that were over 18 metres. That is what the £5 billion of funding remediates.
Many people in this debate have asked about the other elements, such as the missing fire breaks. It is of course absolutely right that we cannot expect leaseholders to take on a debt of tens of thousands of pounds; that is simply not right. We need to take a risk-based approach to the issue. Lots of buildings, particularly lower-rise buildings, can be safely remediated without necessarily replacing cladding: sprinklers, fire alarms and other systems can make those buildings just as safe.
We need to form a coalition of people right across the sector—be it building owners, contractors, managers or manufacturers—to find the best risk-based solution to the problem while minimising the cost for anybody, not least leaseholders. Of course developers should pay, and in many cases they have—Persimmon has just put £70 million to one side to remediate some of its buildings—but the difficulty is that we are often trying to deal with developers that are no longer there. The levy that the Government have introduced is absolutely the right solution, and I urge them to extend it to materials manufacturers and in particular insulation manufacturers, which I feel are principally responsible for the scandal of the situation in which we find ourselves.
On leaseholders, we of course do not want to see anybody go bankrupt as a result of these costs. There is a cap on costs for lower-rise buildings; it may well be that there should be a cap on the costs of remediating these issues for any leaseholder in any building. We should look into that, along with the possibility of the Government top-slicing the risk to make the insurance costs much lower. There are solutions and we all need to work together to provide them.
I have great respect for my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) and his expertise in this policy area. I accept that the amendment is not at all perfect, but it is the only thing that is currently available to keep the issue in play, which is why, unfortunately, I cannot support the Government tonight. I had hoped we would have a solution by now.
The simple point is that whoever is at fault—there may be a number of them as this has happened over a period of time—the people who are not at fault are the leaseholders who bought in good faith. They relied on surveys and regulations that appeared to suggest that their properties were in order and had no reason to think otherwise. It therefore cannot be right that they are out of pocket, regardless of the height of the building. I quite understand that there may be perfectly good reasons for using 18 metres as a threshold of risk for prioritising work, but it has no relevance to responsibility, moral or otherwise, so it is an arbitrary cut-off point.
I had hoped that Ministers would have taken the opportunity between the previous debate and this one to come up with a further scheme. I urge my right hon. Friend the Minister, who I know is trying to do the right thing and has put a great deal of money into the matter, to continue to think again and work urgently on this matter because, as my right hon. Friend the Member for North Somerset (Dr Fox) said, time is pressing. The only people who do not have the cash flow are the leaseholders. By all means go after those at fault, be they builders, developers or contractors, but in the meantime we cannot leave leaseholders, who have done nothing wrong, facing bankruptcy because they are effectively in negative equity and are having to fork out for a significant amount of costs, as are my constituents at Northpoint in Bromley.
This is destroying people’s lives. None of us wants to do that and I know that the Government do not want to do that. To find a solution, we have to cover the costs for those people who are not in a position to fund these costs over the length of time between this Bill imposing a liability on them and the Building Safety Bill coming along perhaps 18 months—12 months at best—down the track. It is covering that gap that needs to be done. That gap has to be covered in a way that treats and protects all leaseholders equitably regardless of the height of the building. I hope that the Government will use the opportunity of this going back to the other House to think again and urgently to crystallise a solution that we can all join around. The intentions are the same across the House, but we must have something that does not leave leaseholders—those who are not at fault—exposed. It is not a question of caveat emptor. They relied on professional advice and assurances. They are not the ones at fault. Be it loan or grant, either way they should not be picking up the tab for something that was not, ultimately, their responsibility.
I am grateful to all right hon. and hon. Members for their contributions to this debate. Members have spoken passionately and sincerely on behalf of their constituents. I think that everybody, from all parts of the House, wants to see the cladding scandal ended once and for all, and ended quickly, which is what the Government are about.
The Minister is being very generous. He kindly agreed the other day to speak to his ministerial colleagues about getting a sit-down meeting with Julie James, the Welsh Minister for Housing and Local Government, to resolve some of these unanswered issues. She did write on 10 February to the Secretary of State for Housing, Communities and Local Government. She has yet to receive a reply. Can we please get that meeting arranged and please get some answers to her very reasonable questions on behalf of leaseholders in Wales?
Not only did the hon. Gentleman speak to me in the Chamber, but, even more importantly, he spoke to me in the Tea Room. I shall certainly ensure that he gets a response as swiftly as possible.
In the time that I have, let me speak to the effectiveness of this amendment. As parliamentarians, no matter what the issue is before us, we have a duty, as I said earlier, to implement a clear framework and transparent legislation to support fire and building safety reform. Despite the best intentions of those who have tabled this amendment, I have to say that it is unworkable and impractical. There are three specific points that I should raise. First, the amendment does not take into account remedial works that arise outside of the fire risk assessment process—for example, costs identified as a result of a safety incident or building works taking place. In such cases, this will not prevent costs being passed on, so it does not deliver what Members want it to do. Furthermore, if these amendments were to be added to the Bill and become law without the necessary redrafting of the legislation, the Government, and thereby the taxpayer, would in all likelihood fall liable to protracted action by building owners in the courts. Building owners could use litigation to claim for costs that they feel are entitled to be pursued from leaseholders. While that litigation is ongoing, there could be further delays to construction work carried out on urgent remediation. It could be a waste of time and a waste of taxpayers’ money. Redrafting the Bill is not something that can be done at the stroke of a pen. It requires parliamentary counsel and parliamentary draftsmen to work at it to ensure that any changes are sound and that any secondary legislation is also prepared, so that the Government, and thereby the taxpayer, can avoid legal challenge. We would not be able to get it done in this Session.
Furthermore, the amendments do not reflect the complexity involved in apportioning liability for remedial defects. The Government have announced how they will distribute costs, including from developers and industry, through our upcoming levy and tax. A decision through this amendment to pass all these costs to the building owner would be overly simplistic and it could be counter-productive. It would be self-defeating if landlords, faced with remediation costs, simply walked away. Many could do that. They could activate an insolvency procedure and just walk away. That is not about protecting freeholders, but about protecting leaseholders. It is about their position, because if leaseholders are left behind as the owners walk away, they would be in the same position as they are now, with no certainty on how works would be paid for or when they will be done. There is a real risk that this amendment could make the problem worse for leaseholders. We would be left in a situation where there would be delays to the commencement of the Fire Safety Bill, delays to our wider building safety programme, greater uncertainty for leaseholders and, quite possibly, unintended and deleterious consequences for them. We would not be any further forward in resolving the issue.
We have been working hard to ensure that those with broader shoulders and those that should pay do pay. That is why my right hon. Friend the Chancellor announced at the Budget that there will be a levy on tall buildings and a tax on the sector. We do not want to absolve the industry of its responsibility. We are finalising how the levy will be calculated and the Treasury is leading on the development of the tax. Of course we want to ensure that it works effectively, and that small and medium-sized developers are not unfairly disadvantaged. We want to get it right and we want to get it done as quickly as we can.
I am also encouraged that we are now seeing developers step forward in this effort by putting aside significant funding: Taylor Wimpey has put aside £125 million of funds to de-clad the buildings for which it is responsible; and, as my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) mentioned, Persimmon has put aside £75 million, and has committed to pay all ACM and non-ACM remediation and inherent defects in the buildings for which it is responsible. The sector is now stepping forward, and we encourage more developers to do so. We will bring forward as soon as we possibly can the workings of the financial support scheme that we announced at the Budget that will ensure that leaseholders in buildings below 18 metres pay no more than £50 a month.
This has been a crucial debate.
One hour having elapsed since the commencement of proceedings on the Lords message, the debate was interrupted (Programme Order, 24 February).
The Deputy Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83G),
That this House disagrees with Lords amendments 4B, 4C, 4D and 4E.
The list of Members currently certified as eligible for a proxy vote, and of the Members nominated as their proxy, is published at the end of today’s debates.
Motion made, and Question put forthwith (Standing Order No. 83H), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments 4B, 4C, 4D and 4E.
That Christopher Pincher, Tom Pursglove, Mike Wood and Sarah Jones be members of the Committee.
That Christopher Pincher be the Chair of the Committee.
That three be the quorum of the Committee.
That the Committee do withdraw immediately.—(James Morris.)
Committee to withdraw immediately; reasons to be reported and communicated to the Lords.
Counter-Terrorism and Sentencing Bill (Programme) (No. 2)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Counter-Terrorism and Sentencing Bill for the purpose of supplementing the Order of 9 June 2020 (Counter-Terrorism and Sentencing Bill (Programme)):
Consideration of Lords Amendments
(1) Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.
(2) Any further Message from the Lords may be considered forthwith without any Question being put.
(3) The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(James Morris.)
Question agreed to.
Relevant documents: 25th and 29th Reports from the Delegated Powers Committee
2A: Because the Government has announced that it intends to bring forward its own legislative proposals to address the issues mentioned in the amendment.
My Lords, I will speak also to the House’s Amendments 3 and 4, with which the other place has disagreed for its Commons Reasons 3A and 4A. Before I address the amendments agreed at the Lords Report stage, I would like to make a few comments about the overall importance of this piece of legislation. The Bill was introduced in the other place nearly a year ago today and we are moving closer to getting it on to the statute book. As there are a couple of issues to resolve, it is vital that we should remind ourselves of the fundamental purpose of the Bill. It is an important step in delivering fire and building legislative reforms. It is purposely short because it has been designed to provide much-needed legal clarification that the fire safety order applies to structure, external walls and flat entrance doors. What this will mean on the ground is that these critical elements will be covered in updated fire risk assessments and ensure that enforcement authorities can take action where necessary. In short, the current legal uncertainty will end.
I turn to Amendment 2 and Amendment 2B proposed in lieu by the noble Lord, Lord Kennedy. The Government remain steadfast in their commitment to delivering the Grenfell Tower inquiry recommendations, including those on the duties of an owner or manager. As such, the amendments are unnecessary. However, I thank him for his constructive engagement with me prior to this debate. I will be able to provide further reassurances to the House in respect of timing that he is seeking and look forward to outlining them in response to the debate.
I turn now to Amendment 3. I thank the noble Baroness, Lady Pinnock, for the constructive conversations that we have had regarding a public register of fire risk assessments, and I am grateful to her for not pressing her amendment again today.
I move on to Amendment 4, Amendments 4B, 4C, 4D and 4E proposed in lieu by the right reverend Prelate the Bishop of St Albans, and Amendment 4F proposed in lieu by the noble Baroness, Lady Pinnock. I recognise the concerns of your Lordships to ensure that swift action is taken to protect leaseholders from the significant remediation costs related to unsafe cladding and other historic building safety defects. We are all acutely aware of the full toll that this has taken on leaseholders and the pain and anguish that it has caused. I expect that we will hear a number of views during the debate on the important issue of remediation. However, this is a highly complex matter without a simple solution, and it cannot be resolved in this short Bill.
I make it clear now that we have a number of concerns about the alternative amendments, and I will set out my specific views on them at the end of the debate. I beg to move.
Motion A1 (as an amendment to Motion A)
2B: After Clause 2, insert the following new Clause—
“Legislative proposals relating to duties of owner or manager
(1) Within 90 days of the passing of this Act, the Secretary of State must publish draft legislation to require an owner or a manager of any building which contains two or more sets of domestic premises to—
(a) share information with their local Fire and Rescue Service in respect of each building for which an owner or manager is responsible about the design of its external walls and details of the materials of which those external walls are constructed,
(b) in respect of any building for which an owner or manager is responsible which contains separate flats, undertake annual inspections of individual flat entrance doors,
(c) in respect of any building for which an owner or manager is responsible which contains separate flats, undertake monthly inspections of lifts and report the results to their local Fire and Rescue Service if the results include a fault, and
(d) share evacuation and fire safety instructions with residents of the building.
(2) Within 90 days of the passing of this Act, the Secretary of State must publish a statement on a proposed timetable for the passage of the draft legislation mentioned in subsection (1).
(3) Within 120 days of the passing of this Act, the Secretary of State must publish a statement confirming whether the draft legislation mentioned in subsection (1) has progressed.””
My Lords, I draw the attention of the House to my relevant registered interest as a vice-president of the Local Government Association, the chair of the Heart of Medway Housing Association and a non-executive director of MHS Homes Ltd. In moving Motion A1, I will address all the Motions before the House today.
It is disappointing that the Government have over- turned the amendment passed by this House. The intent of our amendment was to make progress in implementing the recommendations made in the first phase of the Grenfell Tower inquiry. Our frustration, along with the frustration felt by many, has been that since the recommendations made in the first phase were published, progress has been extremely and annoyingly slow. Being told by the Government that in most cases we do not need legislation to make progress is in some ways even more frustrating because nothing has happened, which is again very odd. This is the first piece of legislation we have seen that will bring anything into force. Frankly, the victims and their families deserve better. People living in properties that are unsafe or blighted deserve better than that.
This led me to propose Motion A1, which proposes to insert a new clause into the Bill. What my amendment seeks to do is accept the Government intention to take action but to add some rigour and rigidity to the proposals with clear timescales for action. As I have said previously, this has all been too slow with no clarity about what the timescales are for action through primary legislation and through secondary legislation and guidance.
This morning I received a letter from the noble Lord, Lord Greenhalgh, which seeks to add some clarity to the timescales for action, and that is welcome. We also have the Government’s response to the consultation, which is helpful. It looks as if we are finally making some progress and I welcome that. It would be good to hear him, when he responds to the debate, set out the timescales for the actions the Government are proposing, and I look forward to that. That will be part of the official record of the House and the Government will be held accountable for the pledges that they make today.
In respect of Motion B, while I accept that the Commons can assert financial privilege and the need not to give any other reason, we must consider the subject of the amendment that was rejected and the circumstances that have led to this Bill, as well as the intention behind the amendment that the other place has rejected. We would have hoped to have got a little more than the assertion of financial privilege. This is about fire safety and reassurance for residents that the register is up to date, that it can be relied on and that it is publicly available and transparent so that sunlight on fire risk assessments will provide more reassurance. I hope that when the noble Lord responds to Motion A, he will provide a bit more clarity than just relying on financial privilege as expressed by the other place.
Motion C1, tabled by the right reverend Prelate the Bishop of St Albans, seeks to add to the Bill Amendments 4B, 4C, 4D and 4E. They would prohibit the owner of a building from passing on the costs of annual remedial works attributable to the requirements of the Act to leaseholders or tenants, except where the leaseholder is also the owner of the building. The amendments under the Motion tabled by the right reverend Prelate have my full support, and the Labour Benches will support him if he decides to divide the House. I hope very much that he will do so.
Leaseholders are victims and have done nothing wrong. They deserve to be treated much better than they have been by the Government. They have done everything right. They have bought their properties and are paying their mortgages. Now they are being penalised for the failure of others. Surely that cannot be right. The fact that their buildings have been covered in dangerous cladding has made their flats worthless. They cannot sell their properties, but they are still expected to pay their mortgages and other charges. They cannot get work done; they may be paying for a waking watch and in some cases the properties will have guarantees on them which need to be drawn down. There will be warranties for work done which need to be used. They have been paid for, otherwise they are literally not worth the paper they are written on.
We should all stand up to support leaseholders and tenants and get those who have done the work to accept their responsibility and put this right. The Government are failing leaseholders and tenants. Their actions are just not good enough and fall far short of what they promised.
I want to be clear. For the individual builder, contractor, company, warranty provider or insurance company, it cannot be right for people to wriggle out of their responsibilities. The Government need to take firm action. Supporting the Motions and amendments before the House today will be an opportunity to ask the Government to think again, and I hope we take it. I beg to move.
My Lords, I speak to Motion C1 and Amendments 4B to 4E. I give notice of my intention to seek the opinion of the House when the time comes. I declare my interest in the register in that I, too, am a vice-president of the Local Government Association.
I first thank the honourable Members for Stevenage and for Southampton, Itchen, who originally prepared these amendments, as well as the signatories from all parties when they were tabled in the Commons. I also thank the right reverend Prelate the Bishop of London, who joins me in supporting it, and pay tribute to one of our colleagues, the Bishop of Kensington, who has worked very closely on the ground with victims of Grenfell and leaseholders.
Grenfell was an unmitigated tragedy brought about, it would seem, by institutional failings on multiple levels. The recent revelation that the cladding provider knew that it could result in tragedy and death is nothing short of a disgrace. It has been a tragedy for many lives: ordinary families have been ripped apart by this terrible event.
The Bill will deal with the problem of dangerous cladding by creating a quick and easy mechanism to force freeholders to remove dangerous cladding and other fire safety defects. That is undoubtedly a good thing and will, hopefully, protect against future tragedies, but I share the disappointment of the noble Lord, Lord Kennedy, that Her Majesty’s Government have not sought to address the severe adverse financial consequences that the Bill will create for leaseholders. In the Bill’s current form, whenever the fire service serves notice to the freeholder requiring remedial work to be undertaken, the freeholder will be able to force leaseholders to reimburse all the costs incurred. These costs are staggering.
At this point, I say that our hearts go out—I am sure we all share this—to all the people who are struggling. I have been inundated with emails, tweets and people contacting me who are at their wit’s end looking at what is likely to unfold in the next few weeks. Far from the Government’s estimated remedial costs of around £9,000 per leaseholder, depending on the terms of the lease and the work involved, a leaseholder could very easily be handed a bill of £50,000, payable within weeks.
Inside Housing conducted its own private survey of 1,342 leaseholders. Its findings reveal a very different picture to that of Her Majesty’s Government. Among those surveyed, 63% of respondents faced a total bill above £30,000 for remedial costs and 15% faced a bill of more than £100,000. Of course, a few of these lease- holders may be well off, some will have disposable income, but most will not: 60% had a household income of less than £50,000, with only 8.7% reporting a household income of more than £100,000. In other words, this will primarily affect ordinary middle to working-class people.
In addition, 56.4% of those surveyed were first-time buyers. They have followed that life trajectory that many Conservative Governments have sought to promote by working hard, saving and purchasing a property. These are people with aspirations—something I totally support—yet nearly everything they have worked hard towards, over many years, could be taken away from them, as shown by the alarming 17.2% of respondents who say that they are already exploring bankruptcy options. I must remind the House that the costs mentioned above include only the remedial costs; they say nothing about the interim fire safety costs that leaseholders already incur.
Government figures show that the average monthly cost of a waking watch in England is estimated at nearly £18,000 per building and around £330 per dwelling, rising to nearly £20,000 and £500 respectively in London. This is not to mention the cost of new alarm systems, ranging from £50,000 to £150,000 per block. How can this be fair or just? It was not the leaseholders who sold or fitted defective cladding; leaseholders are the innocent party. They purchased their properties in good faith, believing them to be safe. If the Bill passes unamended, it is they who will pay—not the cladding providers or the developers but hard-working ordinary people, forced to pay for defects that were deemed safe when they purchased their apartments.
I do not have the technical knowledge about how the Motion fits with the Bill and so on, and whether it would be better placed in a later Bill. What I do know is that we are faced with some immediate challenges. Any solution cannot be deferred until the building safety Bill, which could be as far as two years in the future. We have to try to do something now. Supporters of this Motion and I have argued that because this legislation creates the problem for leaseholders, it should likewise solve the problem. I acknowledge that there are some weaknesses in this Motion; it does not solve every problem for leaseholders. Even if it is passed, leaseholders will still shoulder ongoing interim fire safety costs. However, by preventing remedial costs from being passed on to leaseholders, a significant proportion of the financial burden placed on them should be eased. As one leaseholder said, “We need a solution so we can finally move on with our lives, something denied to us now for several years. We just want this nightmare to end”.
I hope that by passing this Motion, we can begin to end that nightmare and the anxiety plaguing the lives of thousands of leaseholders, allowing them to move on. The Bill solves the fire safety defects that lay at the heart of the Grenfell tragedy. The Government are absolutely right to do that and I am grateful for what they have done, but I believe they are morally wrong in their treatment of leaseholders in this crisis. By not including sufficient provision to protect leaseholders, a conscious decision would be made to impose poverty, possibly bankruptcy and certainly misery on thousands of ordinary people whose only crime was being aspirational.
Those responsible should be the ones who pay. Only the Government can provide the capital up front to pay for these works; only the Government can introduce levies on those responsible to claw back that money over the next few years. A great injustice is currently being done to leaseholders and a fair solution is needed, which is why I bring this Motion to your Lordships’ House.
My Lords, I now call the noble Baroness, Lady Pinnock, to speak to but not, at this point, to move Motion C2.
My Lords, I draw the attention of the House to my relevant interests as a vice-president of the Local Government Association and a member of Kirklees Council.
Much has happened since the Bill was last debated in this House in November. It is already clear from the contributions to this debate today that this is an unresolved crisis of major proportions. I thank the Minister for the opportunities that he has provided to discuss the issues raised. The Government’s response has been to regard this as largely an issue for lease- holders and freeholders to resolve. Gradually, however, they have acceded to the principle that, without government intervention and funding, the problem will not be resolved.
The purpose of all the amendments in my name and that of the right reverend Prelate the Bishop of St Albans is to extend the principle already agreed by the Government. Amendment 4F in my name would extend the contribution that the Government make to cover not just the remediation but the extortionate service charges and higher insurance costs that are currently being levied on these leaseholders. This serious problem can be successfully fixed only with up-front funding from the Government, which can then be recouped from developers, construction firms and manufacturers.
The Government’s own estimate is that the total cost of remediation will be in the region of £16 billion. The buildings involved are not just in London but all across the country. Following the Grenfell tragedy, we now know that ACM cladding was affixed to blocks when it was known to be inflammable. As the cladding is peeled away, further serious building defects are revealed. The Government recognise this, as they have issued a directive to local authorities requiring an inspection of various features, including fire breaks, insulation and spandrel panels, as well as cladding. This is now much more than a cladding scandal; it has become a construction crisis.
Worse still is that some of the defects that are being exposed were in breach of building regulations even at the time of construction. The big question then is: who is going to pay? Currently, the Government are providing grants for the removal of cladding only and are restricting those grants to buildings of 18 metres or more in height. Yet cladding has to be removed from all blocks, irrespective of height. The Government have chosen 18 metres partly because they simply have no idea how many blocks there are that are lower than 18 metres. I have asked the ministry for the analysis of those risks to which the Minister will refer but have received no reply to date. Good decision-making is dependent on well-researched data, which is then shared for all decision-makers.
At the heart of this crisis are people who have done everything right and nothing wrong. They are innocent victims and have suffered enough. Imagine living in a flat with your family, knowing for three years or more that the home you saved hard to buy is a significant fire risk. That fact alone has left emotional scars on those leaseholders. Then imagine, having carefully budgeted, being faced with an additional service charge of several hundreds of pounds each month to cover the extras: waking watch, insurance and more. For some, the final straw is that you are then billed for the costs of total remediation. For individuals faced with these enormous bills, the choices are very limited.
Bankruptcy has already been the solution for too many. George is one such. He describes himself as a frightened leaseholder and says, “I have been informed that it will cost £2 million to replace the cladding and remedy the defects. That is £50,000 per flat. I’ll be bankrupt by the end of the year at the age of 28. The building has one grant, covering 10% of the costs.” Everything that he and others have worked and saved for is lost through no fault of theirs. It can lead to homelessness. Sarah lives in a flat in the Royal Quay in Liverpool. The normal year service charges for that block were £270,000; this year, the service charges are nearly £1 million. Sarah says that the defects are so numerous that the fire service may have to escalate from a compliance to a prohibition notice, which will shut down the complex. If that occurs, 400 residents will be made homeless.
Not surprisingly, given those examples, for some the stress is such that very serious mental illness, or worse, has followed. Hundreds of thousands of individuals and families are watching and waiting for the decision of this House today. They are willing us on to help to find a fair and just solution to a problem that is not in any way of their making, yet they are the ones who are being asked to pay the price. If the right reverend Prelate the Bishop of St Albans wishes to divide the House, as he has indicated, the Liberal Democrat Benches will support him. If, however, he chooses not to do so, then I will wish to test the opinion of the House.
My Lords, I declare my interests as a vice-president of the LGA and as a practising chartered surveyor. I have very considerable sympathy with all these amendments but, the matter having now been decided by this House, gone to the other place and now come back, it behoves us to consider all these matters with a degree of objectivity, despite the clear emotions that are involved.
With regard to Motion moved by the noble Lord, Lord Kennedy, I agree that it has taken far too long to deal with this matter, which has allowed the issue to grow in a way that should have been nipped in the bud at an earlier stage, but I realise the complexities of the issues, which I will address in a moment. On all these amendments, I must say at this juncture that I do not know which way I would vote; it will become apparent why as I proceed.
It goes without saying that I have the greatest possible respect for the right reverend Prelate the Bishop of St Albans and the powerful case that he makes for Motion C1 and, for that matter, the case made by the noble Baroness, Lady Pinnock, on the allied Motion C2. Indeed, every fibre of my being tells me that a great injustice has been visited on many innocent people as leaseholders and tenants in buildings affected by this Bill who have faced the burdens of past failings, delays and inaction, which they themselves may be powerless to deal with. It must be as if the whole system of property law and ownership has conspired against them. As a property professional, I feel that most acutely. It has been made worse, as I say, by the length of time that these problems have been gestating.
However, whatever my heart tells me on the grounds of ethics and justice, my professional experience tells me that these amendments would, almost inevitably, not achieve their aims or address the present or future fundamental issues. This Bill potentially affects a very wide category of property and tenure, not just high-rise blocks. The provisions of Clause 1 extend the regulations to any property comprising two or more separate units of accommodation. I ask noble Lords to contemplate just what that means in practice.
To some extent, the measures are retroactive. The Regulatory Reform (Fire Safety) Order 2005 will, at a stroke, be extended to a large number of properties previously exempted, with application of new responsibilities and duties to those deemed to be in control of them. Within its orbit will fall many factors, both known and as yet unknown, some with causes going back many years. This consideration is objectively a good thing in terms of safety, but it will certainly catch unawares many property owners, managers, tenants and long leaseholders, due to its retroactive nature.
All property ownership carries duties, responsibilities and risks. I have often commented to clients that one disbenefit of membership of the property-owning democracy is that, from time to time, one has to incur expense to defend one’s interests at net cost. That is different from the point made about the innocent and not well-funded person having to bear totally improbable levels of costs.
Although the ghastly trigger for all this is raw in our memories, identifying specific groups as special cases or categories of person who should be absolved from any liability for costs is not, to my mind, a solution. It does not take account of the general need for periodic repair, replacement and remediation common in the built environment. Crucially, it does not move us any closer to the relief of burdens on the innocent or the attachment of liability to those responsible, even less to the financial expenditure ultimately necessary to solve the problem. It might simply move things to another, equally blameless sector when, in fact, the need is to contain and address matters where they now arise and not allow this contagion to spread further.
I am far from sure that every potential measure to every property covered by this Bill is free from some latent previous work or alteration. In many ways, everybody here is pleading not guilty. I mentioned some of the players at Report, and I will not repeat that—the noble Baroness, Lady Pinnock, has reminded us of some. The Motion seeks to address a specific issue by altering the general operation of laws on liability for costs, and I am really not sure that that works, even less that it is without significant further consequences.
Left to my own devices, I might have proposed something far more radical than this Motion, such as the removal of the principle of caveat emptor so that property sellers might be liable for poor or dangerously sloppy workmanship during their period of stewardship; or preventing the use of corporate special purpose vehicles to protect large and wealthy development companies from the responsibility for poor construction standards on individual sites; or ensuring that, if the comfort of a construction warrantee forms part of what the purchaser or mortgagee might reasonably be expected to rely on, then it does in fact sit behind the same kind of quality standards reasonably to be expected under the sale of goods and services generally in this country.
I know that among all the moving parts of the laws of property, construction, contract regulation and insurance, civil and criminal liability, fraudulent misrepresentation and so on, even greater collateral damage could be caused to one of the slickest property markets in the world if we are not extremely careful. My recommendation would be to follow a route that is clearly within government competence in circumstances of systemic failure in order to provide relief where it is most needed and to stop the contagion; but that almost certainly does not lie within this Bill. I must recognise what the Minister can deliver, the degree to which HM Treasury will agree to fund, and what the Commons will agree to in this context. I try not to ask for the impossible but there are serious problems here, and beyond individual hardship, personal tragedy and dire effects on individual health and well-being, there are also powerful economic arguments for putting this right—there, I am entirely with the right reverend Prelate and the noble Baroness.
We need to think positively and creatively. The Government are right to stand guarantor and should go further in providing the bridging finance for much of what is clearly essential work to alleviate the worst of the problems, thus enabling swift rectification. However, rectification depends on available competent labour and capacity in this specialised field, plus there are new issues of liability and insurance for anyone now working on cladding. We must review the scope of what is genuinely high risk and perhaps find ways that, while not reducing to zero the risks to occupiers, allow for an incremental process of staged remediation and upgrading and take some of the stress out of the current situation. Surely there must be some cheaper alternative to the waking watch in a form that does not cost everyone their livelihoods.
I used to have to negotiate derogations on fire safety when dealing with old tinderbox listed buildings where the object was to get everyone out to safety via a defined and protected route, even if the building was a total loss as a result. Dirigiste and risk-averse absolutism is often the enemy of reasonable best practice, but I make this point knowing that at this very moment, part of a huge body of work is in progress in government among experts, in which I know the Minister has a direct hand.
We certainly cannot wait for the legal and judicial processes to establish liability before remedying this situation. There are far too many moving parts, as I have already observed, and things could simply grind on for years. Longer term, maybe we need another Law of Property Act, but it might have such far-reaching implications that I merely park the point at this juncture.
Whatever one does in the context of the Bill, it has consequences in several other areas, so while I am hugely sympathetic to these amendments, I am forced to conclude that they may not achieve what is necessary. They are not the fix that is required in a moving and evolving situation, with some crucial areas clouded in uncertainty. I will listen carefully to what the Minister has to say but the Government need to be on the front foot here. These amendments seek to address part of a huge problem that is not going away and which must be addressed.
The following members present in the Chamber have indicated that they wish to speak: the noble Lord, Lord Newby, the noble Baroness, Lady Warwick of Undercliffe, the right reverend Prelate the Bishop of London, and the noble Lord, Lord Adonis. I will call them in that order, so the first speaker is the noble Lord, Lord Newby.
My Lords, I begin by declaring an interest. I am a leaseholder in a block where I stay when I am in London during the week which has been found to have major safety defects and in which a waking watch is now in operation. I have therefore been able to see in my own bills but also by talking to people who live in the block what the consequences of the current situation really are. I strongly support the Motions in the name of the right reverend Prelate the Bishop of St Albans and of my noble friend Lady Pinnock.
This is a scandal of major proportions, and it is a modern one. Most of the buildings we are talking about have been built in recent years. We are not talking about a problem left over from the Victorians or the Edwardians; this is a recent problem of our own times. As we have heard, it is causing great distress, not minor worries, to a large number of people. The scale of the financial consequences of the problems they face affects not just their short-term economic position but every aspect of their lives. The immediate costs in themselves are pretty horrendous for people on modest incomes. In my block, as elsewhere, people in that position are having to take out loans at very high rates of interest to deal even with the ongoing waking watch costs, which are considerable. However, beyond that, people are stuck. They cannot sell their flat or move, even if there were compelling reasons for them to do so. In some cases they feel unable to start a family as they planned, because of the overwhelming financial uncertainties that they face. None of this, as is obviously the case, is their fault at all. The Motion in the name of the right reverend Prelate the Bishop of St Albans deals with the core of the problem and would remove from them the cloud of the future financial burdens they face. I strongly support it.
For reasons which I fully understand, his Motion does not deal with who should ultimately pay for all this. In my mind, that is pretty straightforward. The principal burden should fall on those who are culpable: the developers. They have made very significant profits over very many years from building substandard accommodation, and they should pay for it. In the case of Barratt Developments, which built the block in which I live, its profits over the past five years alone have been more than £3.5 billion. It can afford to clean up its own mess, and the same applies to other major housebuilders. Exactly how that is done is, I admit, complicated, but this is a challenge for the Government which they have not begun to meet.
During the lockdown, television channels are showing old series because it has been so difficult to make new ones. Last night, I watched an old episode of “Yes Minister”, which I strongly recommend. It is clear that the Minister here watched it as well because he has used exactly the arguments which Sir Humphrey used to persuade his Minister not to take action: “It’s highly complex. I’m really sorry. We’d love to do it but it’s really quite difficult, you know. Even if we could do it, which we can’t, it’s not appropriate to do it in this Bill. If we can do it—and I’m not sure we can—it may be possible to do it in a future Bill. I’m not sure which Bill; I don’t know when it’s going to come. But because it’s very complicated, you wouldn’t expect me to say further.” That is the Minister’s response to this.
In last night’s “Yes Minister”, what happened was that the Minister in it, completely frustrated by these usual arguments, put his foot down by announcing on national television that something was going to be done, which in effect bounced his Permanent Secretary into doing it. I suggest that the Minister, the noble Lord, Lord Greenhalgh, takes a leaf out of that Minister’s book and goes on television this very evening to say that he has been so impressed by the debate he has heard that the Government will now act speedily.
The truth is that the reason we are hanging about has everything to do with a lack of political will, and not to do with the technicalities. It is the job of government to deal with difficult things. Most bits of public policy are tricky and difficult. This is no exception but it does not mean that the Government have no policies on anything. It means that they choose what they want to devote time and effort to, and they have decided they are not prepared to put in the time, effort, commitment and funds to deal with this glaring injustice.
The right reverend Prelate’s Motion is a start because it removes the major part of the cloud facing people currently in difficulty and it should be supported. But even when it has been supported, it does not absolve the Government from grappling with this issue and sorting it out properly.
My Lords, I declare an interest as chair of the National Housing Federation, the representative body for housing associations in England. Our members house 6 million people in 2.6 million homes, including a significant number of flats in multi-storey, multi-occupied buildings that need remedial work on their external wall system.
Nothing is a greater priority for housing associations than their residents’ safety. Following the awful Grenfell tragedy, they have been leading the way in the past three years by identifying buildings that need urgent work and carrying it out as quickly as possible. In his Motion C1, the right reverend Prelate the Bishop of St Albans wants to protect leaseholders from huge bills to make their homes safe, and I support him. Leaseholders should not be facing such costs. Other noble Lords have given vivid examples of the impact on leaseholders.
Housing associations are doing what they can to ensure their leaseholders do not have to foot the bill for developers’ mistakes by pursuing the companies that built the buildings, as well as warranty and insurance providers. Sadly, these efforts are not always successful so I applaud a move by this House to provide extra assurance to leaseholders living in these homes.
However, housing associations face a huge dilemma. They exist predominantly to provide social homes to those on lower incomes. The buildings that housing associations need to remediate due to safety concerns will largely be made up of social housing. This welcome move to protect leaseholders must also be coupled with further government funding to pay for the necessary remedial works to all the buildings that need them. While the funding that the Government have made available for remediation costs so far is very welcome, the £1 billion building safety fund and the additional £3.5 billion announced last month are not available to remediate homes in which social tenants live.
Housing associations do not make profits to draw from, so any costs that they incur will generally be met using income from tenants’ rents, as well as money that could otherwise be spent on improvements to tenants’ homes and communities. This would mean that without additional funding, this amendment could result in charitable housing associations paying for works to both leaseholders’ and social tenants’ homes; effectively subsidising leaseholders’ share of remedial works costs with the money that social tenants pay for the upkeep of their homes and communities. Building remediation could cost the housing association sector upwards of £10 billion in total. Of course, I do not want to see leaseholders picking up large bills for this reason, but I do want to see government funding to pay for leaseholders’ share of all works in all buildings, to protect housing association renters from effectively picking up the bill.
Importantly, housing associations also use their funds to build affordable housing. Paying for urgent remedial works to people’s homes must be and is the sector’s top priority. But this essential work means that fewer affordable homes will be built in the future, at a time of desperate need. Research shows that we need 90,000 new social homes every year to meet demand in our country. The G15, a group of London’s largest housing associations, worked out that they have in aggregate spent in the last year, expect to spend next year or have included in their business plans up until 2031, a total of £2.9 billion. They estimate that, as a result of this spend, they will build 72,000 fewer affordable homes to rent, as they continue to prioritise these essential safety works. In addition to this, many of these housing associations will have to defer planned maintenance works and upgrades beyond those required to maintain decent homes compliance.
That group represents just 12 housing associations from a raft of hundreds of organisations that provide affordable homes. This is why legislating for building owners to cover remediation costs does not have the intended effect in all cases. In the case of social providers, they are facing astronomical costs for buildings that they did not construct in the first place.
We are right to seek protection for leaseholders, but that must sit alongside government funding to remediate all buildings in need, including social housing. Otherwise, tenants and people who need social housing will suffer needlessly now and for years to come. As the right reverend Prelate said, the Government are the only agency that can do this, and I hope that the Minister will confirm today that the Government will provide up-front funding for all remedial works and recoup the costs to the taxpayer by establishing liabilities later.
My Lords, I wish to support the Motions in the name of my friends the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Pinnock, which provide a more comprehensive solution than is already in this Bill.
As the 133rd Bishop of London, it has been my privilege to serve this city for the last three years. Unfortunately, I have seen how inequality of outcome is built into our city. As I have followed this debate, it has moved me to speak today. It is almost four years since the Grenfell Tower disaster. Hundreds of thousands of citizens in London and other cities across this country still lie awake at night wondering whether their homes are safe and they can weather the financial hardship of the life-changing remediation bills that they face.
This is having a major impact on the health and well-being of our communities, the communities in this city. My work on the ground with the Bishop of Kensington has meant that I engage with people who are bearing the real cost of this: costs not just financially but to their health and mental well-being, with some facing suicidal thoughts. While they may bear the cost today, they will also do so in the future and there is no doubt that the NHS will bear the cost in the years to come.
We have heard from the Government and substantial sums of money have been cited, but I fear that they do not really go far enough. The amendments of my right reverend friend the Bishop of St Albans and the noble Baroness, Lady Pinnock, exist because each month, people edge closer to bankruptcy and struggle to sell their properties with debts attached from the exorbitant remediation and interim fire safety costs. Due to these financial pressures, some will pay almost 60% of their annual salary on those costs.
The Government’s current approach of a levy on developers has some weaknesses. If the scope of the levy was extended to cover other responsible parties, such as major contractors and suppliers of defective products, greater sums could be raised. The amendments attempt to distribute responsibility fairly, because it is a shared responsibility of the developers’ community, testing and regulatory guidance communities and major contractors to ensure that those who bought their homes in good faith and understood them to be safe, be they high or low-rise, do not face the burden of cost to refit their properties and make them safe. It is our responsibility as representatives of your Lordships’ House to make sure that we do right by the people of this country, even if it is complex. That is the role of government.
The Church of England is quite clear. In a recently published Archbishops’ housing commission report, we recommended that the Government should cover remediation costs and recoup their initial outlays from those responsible. We are looking to the Government to develop a simple, fair and comprehensive solution to the current crisis, but this solution must be clear and cost-effective. It also must be quick. Any solution should be based on “polluter pays” principles, with those responsible for unsafe buildings being required to put them right.
I therefore press the Minister, first, for assurances that the Government will implement a comprehensive solution, to ensure that leaseholders living in blocks more than 18 metres high and blocks between 11 and 18 metres do not pay for any remediation or interim fire safety costs through the building safety Bill, and that they will be compensated for their losses so far. Secondly, I press him to improve the Government’s current approach, which consists of a levy on developers, and distribute the responsibility for these costs as far as possible to all those responsible for the current crisis, and so protect leaseholders and taxpayers. Finally, I press him to create a legacy for the future of buildings and houses that are fit for purpose for those in our community and in a UK post Covid.
If these commitments cannot be given today, will the Minister meet me and representatives of the Archbishops’ housing commission to discuss how we can take forward these solutions in the coming building safety Bill? I support the amendments in the names of the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Pinnock.
My Lords, the most important work this House does is to legislate and, within that work, to assert its view and opinion against the Government and the other House, because that is where we are acting independently, as opposed to acting simply either as a rubber stamp or a deliberative assembly. It always amazes me how little time and attention we spend on our most important function. Many noble Lords are in Committee until 11 pm or midnight, day after day. We discuss amendments a first time, refine them for Report the second time and may come round to them again at Third Reading.
However, when it comes to the most controversial issues in a Bill, which, by definition, are those which we send to the other place, we are expected to hurry them all through. Very inadequate notice is given of matters coming back to this House. There are no proper structured arrangements for discussion, in the way that there are for the ordinary consideration of legislation. We are faced with reasons on hugely weighty issues from the House of Commons as to why it will not accept our view, which usually consist of one or two lines of the utmost banality: statements like “Because the Government has announced it intends to bring forward its own legislative proposals”, full stop.
That is supposed to be a reason why we should set aside all the hours of deliberation by this House, as well as its votes, and simply accept a government assurance. We are always put under great time pressure, and then the Salisbury convention is brought in telling us why this House, having spent hours—and having had many votes—on these issues, should not even spend the proper time and consideration required, including using our undoubted powers to continue to ask the House of Commons to consider these matters again.
Other legislatures with two Chambers deal with these matters much better. They have arrangements for joint sittings on issues that are contested between the Houses, which I believe that we should have. Our arrangements are due only to historical reasons dating from the Middle Ages. One of the right reverend Prelate’s 133 predecessors probably devised these arrangements in the 13th century, even before “Yes Minister”. They are absolutely not fit for purpose in the 21st century. We inhabit the same building; we have electronic means of communication; we can consider these matters better. By definition, when we come to this stage of a Bill, these are always weighty and substantial matters. We would otherwise not be engaging, for the second or third time, in a conflict with the House of Commons.
These are hugely important issues. The noble Earl, Lord Lytton, said that we needed to be objective rather than emotional. But the objective thing to be on this issue is emotional because we are dealing with people who face, as the two right reverend Prelates and the noble Lord, Lord Newby, said, potential bills of £40,000, £50,000 or £60,000 apiece. This will drive them into bankruptcy and cause them huge mental anguish. In some cases—let us be frank; we have all heard of such stories—it can lead to suicide, since these are absolutely catastrophic impacts on individuals. We, as legislators, have a duty to take account of that and reach the best possible arrangement. I stress that we should not be railroaded on issues of this kind into either having to cave in or taking quick decisions before there has been proper consideration.
The right reverend Prelate the Bishop of London referred just now to the Archbishops’ Council. I know that the most reverend Primate the Archbishop of Canterbury has been leading work on this issue, with a number of extremely distinguished experts on housing, and would like to meet the Minister. The very least that the Minister should say in response to her, assuming that this amendment goes back, is that before it comes to this House again he and the Secretary of State will meet the right reverend Prelate, the most reverend Primate and their advisers—who I happen to know include a former Permanent Secretary and other very senior and expert people—to discuss these issues. These are matters of huge anguish and importance.
It is very important that we play fair by people who, as everyone has accepted, are not facing big charges which were expected. The noble Earl, Lord Lytton, said that in respect of property one has duties, responsibilities and risks, but these are not normal risks. People should be expected to bear normal and reasonably foreseeable risks but these were completely abnormal, of a scale they could not have been expected to foresee or budget for.
Their other consequences have not even been mentioned in the debate so far. This is leading to a substantial seizure of the entire property market at the moment. Large numbers of people with leasehold properties simply cannot sell them at the moment. Until these risks are properly quantified, and the allocation of the burdens is properly determined, people cannot sell. It is a huge problem in the property market, and this will continue until it is done.
When the Minister, for whom we have great respect and who knows these matters at first hand, as the former leader of a local authority with large numbers of leaseholders, said that the Government were seeking to crunch through these matters bit by bit and deal with them, that goes straight back to “Yes Minister”. The Grenfell Tower fire was on 14 June 2017. That is, by my calculation, three years and nine months ago. We are not exactly rushing with indecent haste to deal with these issues. It is perfectly reasonable to expect that the Government should do their job, which is to safeguard the community on matters of huge public importance, including putting schemes in place. It took 20 years to build the great wall of China, and we are saying that after four years, the Government still do not have a proper scheme in place to deal with these issues.
So I strongly urge the House to agree to both my noble friend’s amendment and those of the right reverend Prelate the Bishop of St Albans, partly because they are correct, but also because these are huge issues that will, of necessity, require further elucidation and debate. The right reverend Prelate the Bishop of St Albans did something that politicians in this House very rarely do, which was admit that his Motion is not perfect. He pointed to one or two defects, which is an unusual procedure in the House.
What is now needed is a further process of deliberation, because the costs involved and the impacts on individuals are huge. The figures are not even agreed. There is a big difference between what the Government say is the average cost estimate for remedial work, £9,000, and the £50,000 that the right reverend Prelate said. That £41,000 is about one and a half times the average yearly wage in this country. It would be good to agree some of those matters and to have a proper scheme. Certainly we should not be railroaded into closing this matter down today. We should send these amendments back to the House of Commons, because it would give us a reasonable length of time—we do not want another ping- pong taking place later this week or next week—to consider these issues and for a scheme to be brought back.
I will make a few comments on the substantive points at stake. The Minister circulated a letter this morning. Again, it came at the last minute; I read it literally just before coming into the Chamber. It said three things in response to my noble friend Lord Kennedy’s amendment. First, it said that the Government would publish responses to the fire safety consultation. It said that they had done it today, but I could not find them in the printed papers. It also said that they would publish regulations to deliver on the Grenfell Tower inquiry’s recommendations and would indicate where further legislation would be forthcoming. To those of us who are not encyclopaedic experts on what is going on with the Grenfell Tower inquiry and the matters at stake, what the Government are saying is not clear.
Perhaps I could press the Minister on my noble friend Lord Kennedy’s Amendment 2B, which proposes in new subsection (1):
“Within 90 days … the Secretary of State must publish draft legislation to require an owner or a manager of any building … to … share information with their local Fire and Rescue Service in respect of each building … undertake annual inspections … undertake monthly inspections of lifts … and share evacuation and fire safety instructions with residents of the building.”
I would think that all noble Lords would consider these proposals reasonable and essential, so can the Minister tell us whether my noble friend’s four points are met in the responses to the fire safety consultation and regulations to deliver on the inquiry’s recommendations, which they are publishing today? This is crucial to how we decide to proceed with my noble friend Lord Kennedy’s amendment.
On remediation costs, it seems the crucial point is the proposed new subsection (1) in Amendment 4F of the noble Baroness, Lady Pinnock, which states:
“The Secretary of State must design and implement a scheme”
to deal with costs,
“including but not limited to the building owner, freeholder or developer.”
So the question for the Minister to answer at the end, which is crucial to how we decide to proceed, both in the vote at the end of this debate and afterwards, is what the Government’s intentions are in respect of designing and implementing a scheme.
I take up the point of the noble Lord, Lord Newby, both about the scale of the costs and the absolutely correct liability to which developers should be held. Developers such as Barratt have armies of lawyers and the capacity to see off little people—which is most people when it comes to the likes of Barratt. If they have to deal with Her Majesty’s Government in respect of their liabilities, and a Minister of the calibre of the noble Lord, Lord Greenhalgh, turns up on their doorstep and says that they are expected to shoulder these costs —as per a scheme that has been designed and is being pushed by the Government—I assure your Lordships that it will lead to a much bigger result than if it were all left to individual leaseholders and freeholders.
So can the Minister say what the Government are intending to do? Is their intention to stand by and leave hundreds of thousands of leaseholders at the mercy of individual negotiations and freeholders? Or will they move with a Government-led and nationally driven scheme to recover these costs, wherever possible, from developers who have made an absolute killing—sorry, that is not an appropriate word in this context—a fortune on developments, as the noble Lord, Lord Newby, rightly said? They often expect returns of the order of 20%, 25% or 30% when taking forward these developments. As has been shown, with substandard cladding fire safety regulations have not been properly enforced, so it is reasonable that they should be held accountable, and it is the Government, on behalf of the people at large, who should be holding them accountable. Before we pass this legislation into law, we should be assured that the Government have a proper, viable and effective plan to bring that about.
My Lords, is there anyone present in the Chamber, who has been here since the beginning of the debate, who wishes to contribute? No? In which case, I revert to the Minister, the noble Lord, Lord Greenhalgh.
My Lords, I have listened carefully to the debate and will take this opportunity to address noble Lords’ comments and concerns in more detail. I start by addressing Amendment 2B. I again thank the noble Lord, Lord Kennedy of Southwark, for his constructive engagement with me on this. I reiterate again that the Government remain steadfast in their commitment to deliver the Grenfell Tower inquiry phase 1 report’s recommendations in full. It is understandable that the House wants to see visible progress on this and to have a better understanding of the timing of next steps and of the proposals that we will bring forward.
Today, the Government published their response to the fire safety consultation. This is an important and clear demonstration of our progression towards implementing the inquiry’s recommendations. I am clear that, subject to the Fire Safety Bill gaining Royal Assent, the Government intend to lay regulations before the second anniversary of the Grenfell Tower inquiry phase 1 report that will deliver on the inquiry’s recommendations. These will include measures around checking fire doors and lifts.
I am also committed to seeking further views, as soon as practicable, through a further public consultation on the complex issue of personal emergency evacuation plans. We already know that some of our proposals from the consultation will require primary legislation. They include strengthening the guidance relating to the discharge of duties under the fire safety order and the requirement for responsible persons in all regulated premises to record who they are and provide a UK-based address. We intend to include these measures, and possibly others that come out of the consultation, to strengthen fire safety in the building safety Bill, which will be introduced after the Government have considered the recommendations made by the Housing, Communities and Local Government Select Committee, and when parliamentary time allows.
I thank the noble Lord for, I hope, not pressing this matter to a vote. He is right in his role to hold the Government to account for delivering on the Grenfell recommendations, and I am pleased to have provided the reassurance that he sought.
I also thank the noble Baroness, Lady Pinnock, for not pressing her amendment. I understand her interest in this area. More generally, we are looking at specific information-sharing provisions in the regulations and later in the building safety Bill, which we see as a first step to meeting the Grenfell recommendations on this issue.
In response to the noble Lord, Lord Kennedy, the other reason for resisting the public register amendment is that anyone from the general public would be able to access fire safety information about a building, which poses a security risk in the event that the information were accessed by someone with malicious or criminal intent. But the Government do agree with the principle that residents should be able to access critical fire safety information for the building that they live in, and we include proposals for this in the fire safety consultation.
I will now address Amendments 4B to 4F. First, I reiterate the intention conveyed in the other place that we share the concerns around the costs of remediation and the need to give leaseholders peace of mind and financial certainty. I have always been clear that all residents deserve to be and to feel safe in their homes. My right honourable friend the Secretary of State for Housing, Communities and Local Government has committed to taking decisive action to deal with the cladding crisis, and, through the Government’s five-point plan, to provide reassurance to home owners and build confidence in the housing market.
First, as has been commented on, the Government will provide an additional £3.5 billion to fund the removal and replacement of unsafe cladding on residential buildings. This will be targeted at the highest-risk buildings—those over six storeys or above 18 metres—that have unsafe cladding. This is in line with long-standing expert advice on which buildings are at the highest risk. This brings the Government’s investment in building safety to an unprecedented £5 billion or more.
Secondly, we have been clear that leaseholders in lower-rise buildings, with a lower risk to safety, will gain new protection from the costs of cladding removal through a long-term, low-interest, government-backed financing scheme. Leaseholders in a residential building that is 11 to 18 metres in height with unsafe cladding will never pay more than £50 per month towards this remediation.
It is important that this government funding does not excuse building owners of their responsibility to ensure that buildings are safe. We have been clear that building owners and industry should make buildings safe without passing on costs to leaseholders. They should consider all routes to meet cost—for example, through warranties and recovering costs from contractors for incorrect or poor work.
As the Minister for Building Safety and Fire Safety, I will ensure that we drive forward to ensure that remediation of unsafe cladding is completed. I am clear that we have an ambitious timescale to do so. In response to the noble Lord, Lord Kennedy, progress has not been as fast as we would have liked, but we are making great progress, particularly given the constraints of the pandemic this year. Around 95% of high-rise buildings with Grenfell-type ACM cladding identified at the start of 2020 have completed remediation or have works on site to do so by the end of the year.
I want to be clear that, while this issue is vital, it would be impractical and confusing to include remediation measures in the Bill. This is because the fire safety orders are a regulatory framework that sets out the duties of a responsible person in relation to fire risk assessments. It does not cover the relationship, including potential financial obligations or prohibitions, between freeholder and leaseholder. The Bill is so important because it allows for effective enforcement where responsible persons are not abiding by their responsibilities. It addresses the situation where responsible persons refuse to remediate, which is an issue that I am sure the whole House wants resolved as soon as possible.
In contrast, the draft building safety Bill is the appropriate legislative mechanism for addressing the issue of who pays for mediation. Through the building safety Bill, the Government will strengthen the whole regulatory system for building safety, and ensure that there is greater accountability and responsibility for fire and structural safety issues throughout the life cycle of buildings within the scope of a more stringent regime. That Bill’s provisions will put the management of risk front and centre. It is important that remediation is addressed using its proactive mechanisms for managing fire and structural safety issues, such as the safety case. Remediation and costs to leaseholders should be dealt in the context of the Fire Safety Bill to ensure that legislation is coherent with the aims and scope of the new regime.
In response to the right reverend Prelate the Bishop of St Albans, I point specifically to Clauses 88 and 89 in the building safety Bill, which relate to charges. These clauses facilitate regulations that would amend the building safety Act and the Landlord and Tenant Act. We will add to what is already in the draft Bill, including additional duties on the accountable person to seek alternative funding before they pass costs on to leaseholders.
While I appreciate the desire that many noble Lords have for a quick legislative solution to the “who pays” issue, we also have a duty as parliamentarians to implement a clear framework and transparent legislation to support fire and building safety reforms. Even more than this, it is important to ensure that the practical implications of any legislation are properly worked through, rather than being rushed on to the statute book in this Bill. In this vein, I am clear that these alternative amendments do not work.
I thank the right reverend Prelate the Bishop of St Albans for his amendment in lieu. However, it does not take into account remedial works that arise outside the fire risk assessment process—for example, costs identified as a result of a fire or building works taking place. Such cases would not prevent costs being passed on. Further, the amendment is insufficiently detailed and would require extensive drafting of primary legislation, thereby delaying the implementation of the Fire Safety Bill and the crucial measures it puts forward to improve the fire safety regulatory system.
If the amendment were to be added to the Bill and became law without the necessary redrafting, the Government and taxpayers might be exposed to protracted action by building owners and the courts. Building owners could use litigation to claim for costs that they feel they are entitled to pursue from leaseholders under the terms of a lease agreement. While litigation is ongoing alongside disputes over where costs should be, there would also be delays to construction work to carry out urgent remediation and, possibly, interim safety measures.
I also thank the noble Baroness, Lady Pinnock, for her amendment in lieu. However, as with the amendment from the right reverend Prelate the Bishop of St Albans, there are concerns that it would fail to achieve the intention of prohibiting costs being passed on. There are significant legal risks in trying to prohibit the passing of remediation costs through service charges, including an increased risk of facing legal action from landlords without the sufficiently robust legislative detail to override possible conflicts with the terms of existing lease agreements. This, and the need for extensive drafting of all primary legislation, is likely to result in delays, and defects identified outside a fire risk assessment will continue to be passed on to leaseholders.
Moreover, the amendment may be too narrow in its scope by focusing on service charges as the primary site to prohibit landlords passing on remediation costs. They might find other ways to pass remediation costs on to leaseholders, for instance, through additional or exceptional fees and charges, which they might be allowed to pass on to leaseholders under the terms of existing lease arrangements. As such, the amendment has laudable intentions. However, it is unlikely to generate beneficial outcomes for leaseholders.
I have touched on the legal problems that could arise from both the alternative amendments on remediation. I reiterate the complexity around remediation costs, which I believe supports the case that this is not the right Bill to consider these concerns. As I mentioned in my specific points concerning the amendments from the right reverend Prelate the Bishop of St Albans, there are concerns about contractual disputes and potential litigation impacting the Government, the taxpayer and leaseholders. Stating in legislation what the landlord can and cannot recover from leaseholders could contradict the provisions set out in the contractual terms of a lease. As a result, it would be unclear where the costs should lie, rather than being determined by the terms of the lease.
Furthermore, the amendments do not reflect the complexity involved in apportioning liability for remedial defects. There are a range of views as to how costs should be distributed among leaseholders, freeholders, developers, construction industry contractors and other parties. It would be remiss to introduce legislation that places liability firmly on the landlord without adequate discussion about where the costs should lie or how they should be disbursed.
In response to the right reverend Prelates the Bishop of St Albans and the Bishop of London, the noble Baroness, Lady Pinnock, and the noble Lord, Lord Newby, we have announced measures with greater nuance concerning the distribution of costs. This approach combines government funding, repayments from leaseholders, and contributions from developers and industry through an upcoming tax and levy. While the merits of this approach can be discussed separately, one thing that we can agree on is that the simplistic approach of passing these orphan liabilities entirely to landlords despite the terms of existing lease agreements is not the right manner in which to proceed. Not only would the decision to pass all these costs to building owners be overly simplistic, it would also be counterproductive. It would be self-defeating if landlords who have paid a small amount to collect ground rents from flats decide simply to walk away when faced with remediation bills of this size.
Many freeholds are held in special-purpose vehicles to limit the liability held for the individuals involved, and in these cases they could simply activate an insolvency procedure to avoid the debt. This also highlights the lack of robust detail in this amendment, as it contains no due consideration of what would happen to the liabilities at this point. If these owners walked away, leaseholders would be left in the same position, continuing to live in unsafe properties and with no further clarity as to where these costs should lie or who is responsible for payment.
Working through these types of issues in a proper way will require much more extensive drafting of primary legislation. We must avoid encouraging an escalating quantity of contractual disputes and litigation from landlords who feel that the legislation runs counter to their rights and liabilities, as laid out in existing lease agreements.
However, I agree with the noble Earl, Lord Lytton, that we must look at radical ways of improving the recourse to redress mechanisms, and I thank him for his contribution to this debate. I invite the noble Baroness, Lady Pinnock, to find out more about the building occupied by George to see whether we can help that building access the available funds, such as the waking watch relief fund and the building safety fund, to help support the funding of remediation costs. I also note the problems highlighted by the noble Baroness about Sarah, the resident of Royal Quays. We are aware of this development and the difficulties that it faces. I sympathise greatly with the problems raised. We are working alongside Liverpool City Council to do what we can to support the building. This includes considering eligibility for public funding.
I also point out to the noble Baroness, Lady Warwick of Undercliffe, that if housing authorities have to pass costs on to leaseholders, they can apply to the building safety fund, so the leaseholders in housing associations have the same access to funding and will be protected in the same way as those in private housing. I am happy to meet with the right reverend Prelate the Bishop of London and any members of the Archbishops’ Commission on Housing who want to discuss these issues in greater detail.
Let me be clear: it is unacceptable for leaseholders to have to worry about the cost of fixing historic building safety defects. These are recent issues, but not just of the last 10 years, but the last 20 to 25 years. This is not something that has cropped up in the last couple of years; it is a generational problem, in many ways. However, I ask noble Lords to recognise that while these amendments are based on good intentions, they are not the appropriate means of solving these complex problems. On invoking “Yes, Minister”, yes, we need political will, but we also need a political brain to recognise that these problems will not be solved by a simplistic intervention, by orphaning liability or by assigning liability to a freeholder who can subsequently walk away from playing any part in remediating the costs of making the building safe.
For practical reasons, these amendments are likely to be ineffective and may even make the situation worse for some leaseholders. Litigation arising from disputes over what landlords can and cannot recover from leaseholders, where legislation runs contrary to the provisions in existing lease agreements, and where there are disagreements over who should pay costs based on the source of a particular safety defect, is likely to be substantive and problematic. This might result in crucial remediation and even interim measures to protect residents from being delayed. I therefore hope that these amendments will not go to a vote.
I have received a single request to speak after the Minister. I called the noble Lord, Lord Adonis.
The Minister did not comment on the figures given by the right reverend Prelate the Bishop of St Albans, which struck the House as of great concern. He said that average remediation costs could be in the order of £50,000 to £60,000 per leaseholder. Can the Minister comment on those figures?
I have seen figures in the order of £50,000, but that is an aggregate figure that covers cladding costs and more historic building safety defects. Clearly, as we bring forward the legislation to deal with these issues, which will be in the building safety Bill, we must conduct a further impact assessment, but I am aware of the figures that the right reverend Prelate the Bishop of St Albans presented.
My Lords, I will not speak for long. I do not want to detain the House with a long debate. I thank everyone who has spoken. We have heard many very powerful speeches, and very important points were well made. I thank the Minister for his response to my Motion A1, for the time he has taken to speak to me outside the Chamber, and for the letter I received today in addition to the all-Peers letter. It sets out some clear commitments from the Government, a plan and, most importantly, a timetable for action. I welcome this very much.
I listened carefully to the contributions of all noble Lords and agreed with almost every one. I hear the points made by the noble Earl, Lord Lytton. He may be right, but it is our job to press the Government to do the right thing by the people of this country, as the right reverend Prelate the Lord Bishop of London said. I also thank my noble friend Lord Adonis for his support. He made some very valid general points about how we deal with matters from the other place, and points specific to this Bill. I also listened carefully to the Minister’s response to Motion B. I had said that all they rely on in the other place is privilege, and his response was very fair. I can see his point—it is a shame that the other place could not—and I had not thought of it beforehand, so I accept it. We are trying to ensure, in respect of that Motion particularly, that residents, tenants, the fire authorities and the fire brigade have transparency. That is what we want to shine the light on. Perhaps the Minister will not be able to address those issues; it is a shame that the other place did not.
Sometimes the Government say, “We have an ambitious programme” or “We are striving to make progress”, but they have been very slow on this and everyone is frustrated with them. As my noble friend Lord Adonis said, it is three years and nine months since the fire, and this is the first piece of legislation. It is frustratingly slow. Can the Minister talk to the Prime Minister? These issues will not go away, and we will keep raising them until we get some proper action. He has made some commitments today, which is good, but it is only a start. This House will hold him to account on them, because so far this has been frustratingly slow.
Having said that, I am pleased that we got so far today. I have enough to withdraw my Motion A1. I hope that the right reverend Prelate moves his Motion for debate. I beg leave to withdraw the Motion.
Motion A1 withdrawn.
Motion A agreed.
3A: Because it would involve a charge on public funds and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient.
Motion B agreed.
4A: Because the issue of remediation costs is too complex to be dealt with in the manner proposed.
Motion C1 (as an amendment to Motion C)
4B: After Clause 2, insert the following new Clause—
“Prohibition on passing remediation costs on to leaseholders and tenants
(1) The owner of a building may not pass the costs of any remedial work attributable to the provisions of this Act on to leaseholders or tenants of that building.
(2) Subsection (1) does not apply to a leaseholder who is also the owner or part owner of the freehold of the building.”
4C: After Clause 2, insert the following new Clause—
“Costs arising from relevant notices or risk based guidance under the Fire Safety Order
(1) This section applies to a long lease of a dwelling in a relevant building.
(2) This section applies—
(a) where a notice has been served by an enforcing authority under article 28, article 29 or article 30 of the Fire Safety Order; or
(b) where a responsible person carries out works on the basis that they are required or said to be required by the risk based guidance issued by the Secretary of State under article 50 of the Fire Safety Order.
(3) In the lease there is an implied covenant by the lessor, or any third party to the lease, that the lessor or third party shall not recover from the lessee any amount in respect of the costs of works under subsection (2) where the works are to remedy any defect, risk or issue that predated the first grant of a long lease of the dwelling.
(4) Subsection (3) does not apply where the works are to repair a deterioration in original condition.
(5) Subsection (3) does not apply to any interest or shareholding the lessee may have in any superior lessor or freeholder.
(6) This section does not apply to commonhold land.
(7) “Dwelling” has the meaning given by section 112 of the Commonhold and Leasehold Reform Act 2002 and “long lease” has the meaning given by sections 76 and 77 of that Act, save that, in the case of a shared ownership lease, it is irrelevant whether or not the tenant’s total share is 100%.”
4D: After Clause 2, insert the following new Clause—
“Restriction on contracting out of section (Costs arising from relevant notices or risk based guidance under the Fire Safety Order)
A covenant or agreement, whether contained in a long lease to which section (Costs arising from relevant notices or risk based guidance under the Fire Safety Order) applies or in an agreement collateral to such a long lease, is void in so far as it purports—
(a) to exclude or limit the obligations of the lessor or the immunities of the lessee under that section, or
(b) to authorise any forfeiture or impose on the lessee any penalty, disability or obligation in the event of the lessee enforcing or relying upon those obligations or immunities.”
4E: Clause 3, page 2, line 28, at end insert—
“( ) Sections (Costs arising from relevant notices or risk based guidance under the Fire Safety Order) and (Restriction on contracting out of section (Costs arising from relevant notices or risk based guidance under the Fire Safety Order)) shall each come into force on the same day as section 1 comes fully or partially into force in respect of any premises in England.”
Motion C2 not moved.
Consideration of Lords amendments
I must draw the House’s attention to the fact that financial privilege is engaged by Lords amendment 3. If Lords amendment 3 is agreed to, I will cause the customary entry waiving Commons financial privilege to be entered in the Journal.
It may be helpful for Members who wish to take part in today’s debate to know that there will be an initial four-minute time limit on Back-Bench speeches. That gives people the opportunity to tailor their remarks accordingly.
After Clause 2
Risk based guidance about the discharge of duties under the Fire Safety Order
I beg to move, That this House agrees with Lords amendment 1.
With this it will be convenient to discuss the following:
Lords amendment 2, and Government motion to disagree.
Lords amendment 3, and Government motion to disagree.
Lords amendment 4, amendment (e) thereto, Government motion to disagree, and amendments (a) to (c) in lieu, amendments (f) and (g) in lieu, amendment (d) in lieu and amendment (i) in lieu.
Lords amendment 5, and Government motion to agree.
It seems a long time since I spoke on this Bill in Committee in June last year. I am playing a small part in the Bill’s passage through both Houses, and I stand in today for the Minister for Security, my right hon. Friend the Member for Old Bexley and Sidcup (James Brokenshire), who led on the Bill at Second Reading and on Report last year. I am sure everyone in this House wishes him a full recovery.
Lords amendments 1 and 5 were moved by the Government on Report following advice that the Home Office received from fire safety operational experts on how to commence the Fire Safety Bill. In Committee, I announced that the Home Office had established an independent task and finish group whose role was to provide a recommendation on the optimal way to commence this Bill. The group was chaired jointly by the National Fire Chiefs Council and the Fire Sector Federation, and it brought together experts from across the fire and housing sectors.
On 28 September, the task and finish group submitted its advice to the Home Office that the Bill should be commenced at once for all buildings in scope. The Government accepted this recommendation.
The group also recommended that responsible persons under the Regulatory Reform (Fire Safety) Order 2005 should use a risk-based approach to carry out or review fire risk assessments, upon commencement, using a building prioritisation tool, and that the Government should issue statutory guidance to support this approach. The Government accepted this recommendation, which will support responsible persons. The Home Office, with support from the National Fire Chiefs Council and the Fire Sector Federation, will host the model once it has been finalised.
Lords amendment 1 will allow us to take forward the provision of statutory guidance to support that approach. The amendment ensures that the risk-based guidance, which will be issued by the Secretary of State to support commencement of the Bill for all relevant buildings, will have the appropriate status to incentivise compliance. It does this by stating explicitly that a court can consider whether a responsible person has complied with their duties under the fire safety order by complying with the risk-based guidance. Equally, if a responsible person fails to provide evidence that they have complied, it may be relied upon by a court as tending to support non-compliance with their duties under the order.
The amendment also creates a provision to allow the Secretary of State to withdraw the risk-based guidance, but this can be done only after consultation with relevant stakeholders. Our rationale for inserting this provision is that we believe a point will eventually be reached where, having followed a risk-based approach to prioritisation, responsible persons will have assessed all the fire safety risks for the external walls of their buildings. At that stage, there may no longer be a need for the guidance to remain in place.
I assure Members that the Government will commence the Bill at the same time as issuing the guidance, and Lords amendment 5 ensures that will happen. This amendment gained the support of the Opposition in the other place when put to a vote on Report. I also recall the comments of the hon. Member for Croydon Central (Sarah Jones) in Committee, when she said this Bill should be commenced at once for all buildings in scope and that a risk-based approach, like the one modelled in her home town of Croydon, should be adopted.
One of the recurring themes during the passage of this Bill has been concern over the number of fire risk assessors with the skills to undertake work on external wall systems. The task and finish group considered this issue as it looked at how responsible persons will be able to update their fire risk assessments, given there is limited capacity in the fire risk assessment sector—primarily of fire engineers working on complex buildings.
The group’s recommendation for a risk-based approach to an all-at-once commencement, on which we are acting, is the most practical way to deal with what is a complex issue. Our approach sends a signal to the fire risk assessor sector—mainly fire engineers—that their expertise should be directed where it is needed most, to the highest-risk buildings.
I thank all members of the task and finish group for their work in developing advice to the Home Office. The group has provided an optimal solution for commencing the Fire Safety Bill, allowing the Government to introduce the provisions at the earliest opportunity. It is important that we continue the good work undertaken with those relevant stakeholders on the task and finish group to regularly monitor the effectiveness of the risk-based guidance and the building prioritisation tool. These provisions will allow us to take forward the recommendations from operational experts in the field of fire safety. I hope that hon. Members will support Lords amendments 1 and 5, as agreed in the other place.
Lords amendment 3 seeks to introduce a power that the Secretary of State must use to make regulations to establish and keep up to date a public register of fire risk assessments. As you have confirmed, Madam Deputy Speaker, this amendment engages financial privilege and will not be debated. The amendment invokes significant financial concerns. To provide a sense of the scale of costs, we can point to two things. First, based on the number of buildings requiring a fire risk assessment, our initial estimate is that the cost to the public purse of a public register of fire risk assessment is above £2 million per annum.
Secondly, these costs would likely be broadly commensurate with the expenditure of maintaining a database of energy performance certificates. That system was mentioned by Opposition colleagues in the other place, who stated that something similar should be introduced for fire risk assessments. The current database of energy performance certificates is housed centrally in the Ministry of Housing, Communities and Local Government. The current costs for this are around £2 million per year, but under private contractual arrangements used previously, they were approximately £4 million a year. Notwithstanding the issue of financial privilege, I sympathise with the intent behind the amendment, and we will not rule out doing this in the future. However, there is a need for detailed policy consideration prior to implementation of such a database, which makes this the wrong time to impose this measure in primary legislation.
I raise just a couple of points to underline our view that the amendment is not appropriate. The amendment would, in effect, create a legal duty on responsible persons to make publicly available the full fire risk assessment for all buildings falling within the scope of regulation owing to the fire safety order. In its current form, the amendment would potentially mean that anyone would be able to access the fire risk assessments for a wide range of premises, including schools, hospitals, care homes and Government buildings. We would have concerns over the risk that posed to security, particularly if the information was accessed by somebody with malicious intent.
Linked to the security issue is the level of information that could and should be made available if a system of recording fire risk assessments is created. For example, a fire risk assessment can often be technical and is very different from an energy performance certificate. It may, for example, prove more effective and transparent to publish a summary of a fire risk assessment, rather than the full document. However, the Government agree with the principle of residents being able to access vital fire safety information for the building in which they live, and we propose introducing legislative provision to allow them to do so in our fire safety consultation. It is important to take a proportionate and appropriate approach to sharing information with residents. However, I hope that hon. Members will understand my concerns and the reason why the Government will resist the amendment.
Lords amendment 2 would place in primary legislation several specific requirements on the owner or manager of a building that contained two or more domestic premises. I recognise that many in this House and the other place wish to see legislative change on this as soon as possible. The Government share that objective, which is why we committed to implementing and legislating for the Grenfell inquiry’s recommendations in our manifesto. The Fire Safety Bill is the first step towards this. It was always intended to be a short, technical piece of legislation designed to clarify that structure, external walls and flat entrance doors should be included within the fire safety order. We need to deliver on that as soon as possible, to ensure that fire risk assessments are updated to take account of the risks in those areas. We intend to implement the areas specified in Lords amendment 2 through regulations, and as such the amendment is unnecessary.
It is not helpful, I have to say, for the House to keep returning to this issue. It risks causing confusion, as we saw through misleading media coverage of Commons Report stage. It also raises doubts in relation to the Government’s commitment to implementation, when all along we have been crystal clear about our intentions. I reassure the Grenfell community, who I know were distressed by the publicity at Committee stage, and those in the House and the wider public that the Government remain absolutely steadfast in our commitment to implement the inquiry’s recommendations.
I am sure everyone across the House accepts the importance of consulting when proposing significant changes to legislation. The importance of that was underlined by the Grenfell inquiry chair, who said that it was important that his recommendations
“command the support of those who have experience of the matters to which they relate.”
Furthermore, the National Fire Chiefs Council’s published response to our fire safety consultation states:
“NFCC supports the Government’s approach to publicly consulting on how to implement the Grenfell Tower Inquiry Phase 1 recommendations. This consultation provides an opportunity to gather wider views on how to practically deliver the recommendations in a way that brings the maximum benefits to public safety.”
We consulted on our proposals to deliver on the inquiry’s recommendations and to strengthen the fire safety order. This consultation closed in October 2020 and we intend to publish our response this spring. We also intend to bring forward legislation as soon as practicable after the Bill is commenced. Our consultation gave all those affected the opportunity to make their voices heard. This Lords amendment, however, does not do that. It disregards the intent of the statutory duty to consult and seeks to implement changes that do not take account of the responses to the fire safety consultation.
I should restate to the House that we intend to use article 24(1) of the fire safety order, which provides a regulation-making power and a statutory duty to consult, to deliver the Grenfell Tower inquiry’s recommendations. Our proposals will include creating new legal duties for the responsible person in the most practical and effective manner. This includes a proposal for the responsible person to provide information to their local fire and rescue authority about the design of their building’s external walls and the materials they are constructed from, and provide it with up-to-date building floor plans in a standard format, highlighting the location of key firefighting systems within their building. Responsible persons will be required to undertake checks of flat entrance doors, fire doors in the common parts and self-closing devices. Regular inspections of all lifts and other key firefighting equipment in their building will be mandatory, reporting any faults to their local fire and rescue authorities alongside this. There will be an obligation to produce and regularly review evacuation plans for their buildings, and we will look to impose requirements on premises’ information boxes, which will include up-to-date floor plans and other documents as recommended by the inquiry. We will also require the installation of way-finding signage in all multi-occupational residential buildings of 11 metres and over. We are also committed to seek further views on the complex issue of personal emergency evacuation plans. A further consultation will open in the spring and details will soon be available on the Government website.
Some of our proposals from the consultation will require primary legislation. These include strengthening the effect of guidance relating to the discharge of duties under the fire safety order; providing for responsible persons in all regulated premises to record who they are and to provide a UK-based address; the placement of a new requirement on responsible persons for all regulated premises to take reasonable steps to identify themselves to all other responsible persons—this could apply, for example, to a building that houses both commercial and residential units; a requirement that those completing a fire risk assessment must be competent; an obligation on all responsible persons to record their completed fire risk assessments; and for responsible persons to record the name and organisation of those they have engaged to complete the fire risk assessments. There will also be the obligation that any outgoing responsible person be required to pass on all relevant fire safety information to those taking over such responsibilities under the fire safety order. And there are potential measures to increase fines, particularly with regard to the impersonation of an inspector. We intend to include those measures, and possibly others, in the Building Safety Bill, which will be introduced after the Government have considered the recommendations made by the Select Committee on Housing, Communities and Local Government and when parliamentary time allows.
I also wish to place on record the Government’s view that there are fundamental flaws with this Lords amendment. First, on the issue of lift checks, the Grenfell inquiry’s recommendation was specific in that it called for checks of lifts to be carried out on high-rise buildings at monthly intervals. The Lords amendment goes a lot further and applies to all multi-occupied residential buildings. That means that even if such a building was only two storeys high but happened to have a lift, it would require the same approach as a high-rise block. This is not a proportionate solution.
I am also concerned about how inflexible this amendment is. In respect of both lifts and fire doors, it offers no ability to change the frequency of checks without further primary legislation. For example, it may be the case in future that the most appropriate course of action to respond to an evolving situation would be to have a bespoke checks regime for certain types of building that is different from that for other properties. This is but one example of how this amendment could constrain the Government’s ability to keep residents safe, and it is right that we maintain the flexibility to react responsibly to future changes in circumstances.
We have talked about the financial privilege grounds in relation to this amendment, and the reason for this is that we already intend to cover the areas of the Grenfell Tower inquiry’s recommendations mentioned in the Opposition amendment through regulations. We have provided an estimate of the impact of our consultation proposals, which has also been published on the Fire Safety Bill pages of the parliamentary website. It is important to mention in respect of undertaking monthly checks on lifts in all buildings, for example, rather than just in high-rise residential premises, that the costs would be significantly higher than we have accounted for.
I am also concerned about the territorial scope of this amendment. The Bill applies to England and Wales, with the exception of the Government’s amendment on risk-based guidance, which will be for England only. The Opposition want this amendment to apply to Wales, but it does not have the explicit consent of the Senedd. The Welsh Government have expressed the view that this would be a breach of the Sewel convention.
I reiterate the Government’s view that this amendment is unnecessary. It seeks to create delegated powers to lay regulations on these specific areas, despite the fact that this power already exists under article 24(1) of the fire safety order. However, I recognise that those on both sides of this House, those in the other place and the public want greater reassurance that we will deliver on our commitment to implement the Grenfell Tower inquiry’s phase 1 recommendations. It is important that we reach a conclusion on this issue, not least because we owe that to the Grenfell community, and I want to underline the Government’s commitment to delivering on the inquiry’s recommendations.
The Fire Safety Bill is an important first step in the process, which must come first in terms of sequencing. Our intention is to commence this as soon as possible, with supporting risk-based guidance to be ready to support commencement. This will ensure the highest-risk buildings are assessed first. We intend to respond formally to the fire safety consultation shortly. Following on from that, we intend to bring forward regulations as soon as possible. In addition, we have brought forward the Building Safety Bill, which was recently subject to pre-legislative scrutiny. We aim to introduce this after we have considered the recommendations from the Housing, Communities and Local Government Committee report. To underline the Government’s firm commitment to deliver on the Grenfell Tower inquiry’s recommendations, we have published our first quarterly updates on the progress being made to implement the recommendations. These updates are broken down by the themes set out in the inquiry’s phase 1 report on the Government website.
In the interests of getting the Bill finalised and to deliver on important building safety reforms, we were prepared to offer a legislative amendment that would require the Government to report back to Parliament on the specific areas highlighted in the Opposition amendment within 12 months of commencement of the Bill. That would have resolved this issue, and I am disappointed that my offer of this amendment was not accepted by the Opposition. For the extensive reasons I have provided, I hope the House will agree that we are right to reject Lords amendment 2.
Lords amendment 4 seeks to protect leaseholders and tenants from paying for the remediation of unsafe cladding from their buildings. I recognise that a number of alternative amendments have been tabled. I expect we will hear a number of views on this issue today, and I intend to respond to them at the end of the debate, given that many of those interventions will be virtual. First, I should state that we agree with the intent to give leaseholders peace of mind and financial certainty. That is why the Government have recently announced that we will be providing an additional £3.5 billion to fund the removal and replacement of unsafe cladding, targeted at the highest-risk buildings. That brings the total investment in building safety to an unprecedented £5 billion.
I am glad that the Minister has confirmed that extra £3.5 billion, bringing the total to £5 billion. Will he confirm that this will fully cost the removal of the cladding, and that those leaseholders who live in high-rise buildings will not have to foot the bill?
That is the case. I know that my MHCLG ministerial colleagues have been in this place and debated this extensively and, having made the case to the Treasury, it was gratifying to see this money come forward. It will assist those who are living in fear in high-rise buildings in particular, but also those in mid-rise buildings, who, as I am sure my hon. Friend knows, will benefit from a financing scheme.
Unfortunately, leaseholders in my constituency have been left in the dark after the announcement the other day because, despite the co-operation between the Welsh Government and the UK Government on the details of this Bill, they have been unable to get answers on the crucial issues of the building development levy and the new tax and on whether there will be any new money for Wales in the proposals laid out by the Secretary of State. Will the Minister urgently respond to the letter from the Welsh Housing Minister, Julie James, which asks reasonable questions and sets out constructive solutions, and will he and his MHCLG colleagues meet me to discuss these issues and find a solution for leaseholders across the United Kingdom?
I understand the hon. Gentleman’s impatience, and it is shared by us all across the House. The scheme is in development, as I understand from MHCLG, and I know that Ministers are working hard to get the basis, the foundations and the system in place so that the money can be distributed as quickly as possible. Happily, in terms of high-rise buildings, I think we are well over 90% that are either remediated or in the process of being remediated, but I completely agree with him that we need to work with all urgency to bring as much possible relief from the stress of living with this cladding in the future. I will certainly ask my colleagues at MHCLG to consider his offer of a useful meeting. I know they will be responding to correspondence from the Welsh Government as quickly as possible.
I think we all recognise the frustration exhibited by the hon. Member for Cardiff South and Penarth (Stephen Doughty), which is shared across the House. Perhaps the Minister could explain what steps the Government are taking to make sure that the construction industry pays its fair share in the remediation and the future prevention of risk.
I am grateful to my hon. Friend. As Members who have perhaps been in the House a little longer than he has will know, I was Housing Minister for a brief period of 12 months about 18 months ago, and the work started then of sitting alongside the construction industry to get it to stand up and fulfil its obligations to the people who were living in defective high-rise buildings in particular. A number of firms did and, from working with them through the Treasury, the Department for Business, Energy and Industrial Strategy and MHCLG, I know that there is a new atmosphere abroad. That is certainly part of the challenge that we face: it is not just about the regulation we are putting in place today, but a cultural change in the industry towards building safety so that it is now a full partner in facing the challenge for the future.
Government funding does not absolve building owners of their responsibility to ensure their buildings are safe. We have been clear that building owners and the industry, as my hon. Friend has just said, should make buildings safe without passing on costs to leaseholders. They should consider all routes to meet costs including, for example, through warranties and recovering costs from contractors for incorrect or poor work.
We have always been clear that all residents deserve to be and feel safe in their homes. We are working at pace to ensure remediation of unsafe cladding is completed, and we have an ambitious timescale to do so. As I said earlier, about 95% of high-rise buildings with Grenfell-type ACM cladding identified at the start of 2020 have completed remediation or had works on site by the end of last year. However, I am afraid the Bill is not the correct place for remediation costs to be addressed. It is a short but critical Bill to clarify that the fire safety order applies to the external walls, including cladding, and flat entrance doors in multi-occupied residential buildings. That means the responsible person must include those parts of the building in their fire risk assessment. That does not include the remediation of historical defects. It does not have the necessary legislative detail that would be needed to underpin such amendments in regulations. The Building Safety Bill is the appropriate legislative mechanism for addressing these issues, and it will be introduced in the spring. It will contain the detailed and complex legislation that is needed to address remediation costs.
I am afraid that that is the fundamental risk we face at the moment. We want to get the Bill on the statute book as quickly as possible. It forms the starting block of a complex web of legislation and regulation that is required to bring about changes in building safety across the whole country. I hope that Members recognise that the potential delay that may be inserted by a back and forth between the Houses over this particular issue is not useful. As I say, this issue should be debated during consideration of the Building Safety Bill, which will be brought forward shortly, and I know that Members will embrace that particular piece of legislation.
I will make a little progress, if I may, just to outline why that is. These amendments, I am afraid, are not sufficiently clear or detailed to deliver on what Members say they wish to achieve. They would require extensive drafting in primary legislation, thereby, as we have just discussed, delaying the implementation of the Fire Safety Bill and the crucial measures it puts forward to improve the fire safety regulatory system.
The amendments would also be impractical—for example, in cases where it would be difficult to identify whether a risk has materialised from wear and tear or due to a building safety defect. Stating what the landlord can and cannot recover from leaseholders may well contradict the provisions set out in the contractual terms of the lease. It would be unclear where these costs should lie, rather than their being determined by the terms of the lease. This might result in delay to crucial interim measures to protect residents while remediation is being brought forward, meaning that fire rescue services would have no choice but to evacuate residents. Additionally, the amendments, though well-intentioned, would not always protect leaseholders from all remediation costs. They apply only to defects uncovered through a fire risk assessment, but not, for example, to defects discovered as a result of an incident, or indeed other works taking place.
Members will be aware that, as I have said, we will soon be bringing to Parliament the building safety Bill, which is a once-in-a-generation change to the building safety regime. It will bring about fundamental change in both the regulatory framework for building safety and the construction industry culture, creating a more accountable system to ensure that a tragedy such as Grenfell can never happen again.
I am grateful to my hon. Friend for all the work he did as Housing Minister to resolve this issue; we met on many occasions to discuss it. Does he agree that this amendment is self-defeating in that it puts the onus for any fire safety work back on the owner, who, given debts or the cost of that work, will simply walk away? These owners have probably paid a few thousand pounds per flat to collect, rightly, ground rent. If we put a debt on them for £40,000 per flat, they will simply walk away, and who will then carry the can for the work?
My hon. Friend speaks with some expertise in this area and has been a constant presence in debates on this matter over the past few years. He is right. The amendment is self-defeating given the number of, for example, freeholds that are held in limited liability vehicles, which could, in the position he points out, simply put themselves into some kind of insolvency procedure. That is why any measure along these lines would need to be scrutinised carefully and thought about in a little more detail before we brought it in.
Alongside all that, my right hon. Friend the Secretary of State for Housing, Communities and Local Government has committed to taking decisive action to end the cladding scandal once and for all through the Government’s five-point plan to provide reassurance to homeowners and build confidence in the housing market. Funding will be targeted at the highest-risk buildings, in line with long-standing independent expert advice and evidence. Lower-rise buildings with a lower risk to safety will gain new protection from the costs of cladding removal through a long-term, low-interest Government-backed financing scheme. The Government are also committed to making sure that no leaseholder in these buildings will pay more than £50 per month towards this remediation. Let me be clear: it is unacceptable for leaseholders to have to worry about the cost of fixing historical safety defects in their buildings.
I ask hon. Members to recognise that while these amendments are based on good intentions, they are not the appropriate means to solve these complex problems. By providing unprecedented funding and a generous financing scheme, we are ensuring that money is available for remediation, accelerating the process, and making homes safer as quickly as possible. I give my assurance that the Government schemes to address these issues will be launched as a matter of priority and that we will provide an update on the underpinning details, as Members have urged us, as soon as we are in a position to do so. For the reasons set out, I hope that the House will see fit to support me in my aspirations with regard to these and other amendments.
It is a pleasure to follow the Policing Minister. I, too, put on record my best wishes to the right hon. Member for Old Bexley and Sidcup (James Brokenshire), who cannot be here to lead for the Government today. We all wish him a speedy recovery
I thank our fire and rescue services, who are going above and beyond to keep us safe and have worked tirelessly to protect us throughout the covid pandemic. I am grateful to Ministers, to officials and to House staff who have worked with us on this Bill. I give particular thanks to Yohanna Sallberg and Kenneth Fox, who have supported me, in particular, throughout the Bill’s passage. I thank Lord Kennedy of Southwark, and all those Lords who have led this Bill through the House of Lords, and ensured that Labour’s key amendment on implementing the Grenfell phase 1 recommendations was accepted there.
Every time we debate and discuss the aftermath of the Grenfell Tower fire, we hold the memory of those who died in our hands. We must be gentle and respectful, but we must also see the injustice, and honour those who died by taking action, and by not resting until justice has been done and everybody has a safe home that they can afford. I pay tribute to the campaigners—Grenfell United, the families, survivors, and the entire community—for their tireless fight for justice. I also pay tribute to those campaigners who are fighting every day for the hundreds of thousands of people who are trapped in unsafe buildings, and who face extortionate bills and are unable to move. The drumbeat of their lives is fear and anxiety. No Parliament can ignore that.
Thousands of people are working on this, but I particularly thank Ritu and Will from the UK Cladding Action Group, for their assiduous efforts. I thank the 200 people who joined our roundtable this morning, so that we could hear at first hand the horrors that this Government are wilfully enabling. As Ritu said, “we are fellow human beings in these buildings—your family, your friends, your colleagues.” To everyone who is affected, and who is living in fear and anxiety, I say sorry—we must do better.
As we have said throughout the passage of the Bill, we support it, but it is small and the only piece of concrete legislation we have had since Grenfell. That is not an adequate response to the biggest housing safety crisis in a generation. It does not even scratch the surface of the work that must be done to fix the wild west of building control and fire safety that we have seen played out with such horror over the past few weeks during phase 2 of the Grenfell inquiry. It has taken so long to get here, and at every stage we have had to drag the Government into action.
The Government promised to act swiftly after Grenfell, yet it took them almost three years to introduce this Bill. We waited 12 weeks just for them to bring the Bill back to consider Lords amendments. This is intended to be a foundational Bill. Its purpose is to provide clarity, and state what is covered by the fire safety order, which will inform other related and secondary legislation. In Committee the Minister said that the Government intend to legislate further, and he spoke many times of action still to come, as he did today. By this stage, however, we need more than vague commitments about secondary legislation. At the very least, we need a clear timetable from Government that sets out when further changes to the Regulatory Reform (Fire Safety) Order will be delivered, when secondary legislation will be introduced, and when the Bill will be implemented.
In response to a deeply frustrated letter from Grenfell survivors in September, the Government said that the introduction of the Fire Safety Bill was a key priority, yet the Bill does not include provision for any of the measures called for by the first phase of the Grenfell inquiry. We would like many issues around improving fire safety to be included in the Bill, but many will now have to be introduced through the draft Building Safety Bill and by secondary legislation. We have no idea when any of those things will happen.
I have been asked to speak by my party leader, my right hon. Friend the Member for Lagan Valley (Sir Jeffrey M. Donaldson), and by other Members who have relatives who own such flats on the mainland. They have extreme concerns, and the fears that the hon. Lady has referred to about their properties, and what that means for the future. Although the Government have good intentions, I believe —as I think does she—that the Bill does not go far enough. Is she convinced by what the Minister has said, and if not, will she push the amendment to a vote?
I thank the hon. Gentleman for his intervention. I do not think the Government have gone far enough, and I do not accept the reasons why we are going at such a snail’s pace on something so important. I will come to what we think should be done about it.
The Government rejected many attempts to amend the Bill. The draft Building Safety Bill places various requirements on what is called the “responsible person” and refers to the fire safety order for the definition of that, but the fire safety order does not provide a definition of the responsible person. The draft Building Safety Bill even attempts to put into law a building safety charge. It is vital that the fire safety order makes it clear that there is no ambiguity around the definition of responsible person and that it does not mean leaseholders. However, the Government chose to reject that amendment.
The fire safety order requires regular fire risk assessments in buildings, but it includes no legal requirement for those conducting the assessment to have any form of training or accreditation. In Committee and on Report, we tabled amendments that would bring into force an accreditation system for fire risk assessors, rather than waiting for more secondary legislation. We also tabled an amendment to require the schedule for inspecting buildings to be based on a prioritisation of risk, not an arbitrary distinction of types and heights of building. On that point, I am glad that the Government have listened, having turned us down in the initial stages, and taken good practice from Croydon and other areas and introduced a risk-based approach to the Bill.
We tabled an amendment on waking watch to require the Government to specify when and for how long such measures should take place. Thanks to Lord Kennedy of Southwark, our amendment on implementing key measures from the first phase of the Grenfell inquiry passed in the Lords, despite the Government’s attempts to block it. The Government have made so many promises to address the fire safety crisis but failed to keep them. The families and survivors are still waiting for justice, and hundreds of thousands of leaseholders and tenants are still trapped.
As we debate the Lords amendments this afternoon, the Government face a choice on what they include in the Bill. They could do the right thing and fulfil their promises, or they could push the can down the road again—“We do care, just not quite enough, not quite yet.” There are two answers that thousands of people across the country are watching and waiting for today: will the Government change their mind and back the Lords amendment to implement recommendations from the Grenfell inquiry, and will the Government legislate to ensure that leaseholders—blameless victims of this crisis—do not have to foot the bill for measures to make their buildings safe?
Although I understand the point behind the hon. Member’s position—I assume she will vote for Lords amendment 4—can she answer the point I made to the Minister? What will she do when the building owners simply walk away? Where will the costs go? Does she have a solution for that? Does she not accept that this amendment is fundamentally flawed and is not the right way to achieve what she wants to achieve?
I thank the hon. Member for his intervention. He is an expert in this area, and I very much respect what he says. The answer is that it is for the Government to resolve this crisis. It is not for leaseholders to foot the bill. We suggested a national taskforce, whereby the Government could take responsibility for assessing the costs of the remediation work and then find out who is responsible, so that, as with the polluter pays principle, we could get to the point where the people who were responsible for the problem were paying the bill. That is fundamentally what we are trying to achieve, because in law at the moment, those who can least afford to pay are the only ones having to pay. The Minister says that there are flaws in the way the amendment is worded, but he could have amended it.
Lords amendment 2 would place robust requirements on building owners or managers and implement the key recommendations from phase 1 of the Grenfell inquiry. The Minister said that he had concerns with the way the amendment was worded. Again, the Government could have tried to amend it and to fix some of the problems along the way, but have chosen not to do so.
The Government said that they would implement the Grenfell phase 1 inquiry recommendations in full and without delay, and Lords amendment 2 would be a straightforward way for them to fulfil that promise. It seeks to require the owners of buildings that contain two or more sets of domestic premises to do four simple things: to share information with their local fire and rescue service about the design and make-up of the external walls; to complete regular inspections of fire entrance doors; to complete regular inspections of lifts; and to share evacuation and fire safety instructions with residents. Those measures are straightforward and supported by key stakeholders. Indeed, a common response is incredulity that these measures are not already in law.
The Government have even tried to water down proposals on the evacuation of disabled people, as has been reported today. They have proposed requiring personal evacuation plans for disabled people only in buildings with known safety issues and a waking watch. It is only after legal action by the families of those who died in the Grenfell Tower fire that the Government have relaunched a consultation on this.
The fire safety consultation included proposals to check flat entrance doors every six months, but Sir Martin Moore-Bick said that all fire doors should be checked every three months. Ahead of setting up the Grenfell Tower inquiry, the then Prime Minister, the right hon. Member for Maidenhead (Mrs May), said that
“we cannot wait for ages to learn the immediate lessons.”—[Official Report, 22 June 2017; Vol. 626, c. 168.]
Nearly four years after Grenfell, and over a year after the recommendations were published, we have waited ages. It is shameful that these things are not enshrined in law.
I wholeheartedly agree with the points that my hon. Friend is making. I want to emphasise the importance of paragraph (a) of Lords amendment 2, on sharing information about the materials that a building is constructed of, because my constituents in Cardiff South and Penarth have real difficulties getting hold of, for example, architectural drawings and original “as built” drawings. There is simply no consistency in this across the UK, which means that fire and rescue services, let alone anybody trying to undertake works, have a much harder job.
My hon. Friend is absolutely right, and I have had many similar cases in my constituency, with people just trying to get to the bottom of what the issues are, and meanwhile they cannot sell their flat and are facing fire remediation and waking watch charges, their insurance is rocketing and their lives are on hold. We heard from many such people this morning, and it really was very sad.
It is hard to understand why the Government have put forward a motion to disagree with Lords amendment 2. I heard what the Minister said, but my challenge is that he could have tried to amend our amendments if he had a problem with them, to make them work. The answer, “We will do these things, but later” is simply inadequate.
I think that we all share the same objective across the House. I certainly want the recommendations of the first phase of the Grenfell inquiry to be implemented as quickly and robustly as possible. I am afraid, however, that the hon. Lady is trying to make a political point, because my has made it very clear that we have a robust system in place. We have the Fire Safety Bill. We have already done the consultation on the fire safety orders, which will be coming out in the spring. Our methodology has been backed by the National Fire Chiefs Council, and the step-by-step process has also been backed by Dame Judith Hackitt.
I thank the hon. Lady for her intervention, and I do not doubt her sincerity or the work that she has done on this since becoming a Member of Parliament, but I fundamentally disagree. The step-by-step process might be the right process, but it is so slow. It is almost four years since the Grenfell fire, and it is a year since the recommendations were made. The consultation finished in October, and the Government are still considering the responses. It is painfully slow. Have we not seen with covid what is possible when we put our minds to something? Look at how tremendously quickly we have achieved amazing things through this year of trauma. I think that, with commitment, the Government could work faster on this.
I hear what the hon. Member says, but whether we should have a system in law whereby we check that a lift is safe is really not that complicated. Of course there are experts, but throughout all stages of the Bill the Government and the Minister have referred to steering groups, taskforces and consultations, rather than actually implementing the recommendations. We could have gone much faster. The Government published the consultation on fire safety in July and it closed in October, but four months later they are still analysing the feedback. They cannot keep promising to act later; they need to act now. There really are no more excuses. There is no reason why this amendment could not be made. The Lords were right.
I will now move on to Lords amendment 4, to which many amendments have been tabled in an attempt to improve it and build on it. This morning I heard from many leaseholders in this very situation. They told me of their desperation, how their lives have been put on hold, how they face mental health issues, how their insurance has rocketed, how their waking watch costs are exorbitant, how they cannot get EWS forms and so cannot sell their homes, how they face costs of other fire remediation way beyond cladding, and how they live in blocks not covered by the Government schemes. Many of them face bankruptcy. They simply cannot understand the injustice of having to pay for things that were never their fault. They cannot understand how the Government do not get this and will not put it right.
To echo the comment from my hon. Friend the Member for Milton Keynes North (Ben Everitt), it is about getting this right, rather getting it done quickly. Does the hon. Lady not agree that a lot of these policies that we are bringing forward have been measured, have been accepted by experts and are tackling the issue? It is right that we tackle those at most concern of not being safe first, and then follow through afterwards, rather than trying to do all of them at the same time and getting it wrong.
I thank the hon. Member for his intervention. I genuinely struggle to understand why the Government have not grasped the scale of this crisis and the quantity of people who cannot sell their flat, who cannot afford the costs that they are currently looking at, who cannot change jobs and who cannot get married or have children because their lives are on hold. Many are first-time buyers who have saved up, worked really hard and got their flat. If the Government would say today, “We will commit to legislate to say that lease- holders should not have to foot the bill”, we could accept that there was a commitment there, but there is not.
There is no commitment to say that leaseholders should not have to foot the bill. The words are said, but there is no action to put it into law. [Interruption.] The Minister says from a sedentary position that there is £5 billion, and that is true, but that does not cover the vast number of people who are still affected—the vast number of people whose lives are still on hold. One could say that some of them are perhaps traditional Conservative voters. We struggle on this side of the House to understand how the Treasury has not grasped the scale of this crisis and is not putting it right.
I know for a fact that some of those affected are traditional Conservative voters. I have spoken to people from all walks of life, and they are in absolute anguish about this. They are being left in the dark. We had the announcement the other day—it was typical to announce a big sum of money and then not be clear about how much would come to Wales, how the system would work or when the money would come through. These people have been living in the dark and in anguish for months and for years, and it is completely unacceptable.
My hon. Friend is completely right. There is the idea that someone would have a long-term loan where they pay £50 a month. If someone needs to pay off a £20,000 loan, and that loan stays with the building, they have no chance of selling their flat. Nobody is going to want to buy a flat with a bill that high.
What evidence does the hon. Lady have for that claim? This is a maximum charge per unit per month of £50. If she understands how property transactions work, that is a maximum of £600 a year, which capitalises to about £12,000. I am not saying it would not affect the value of that property, but it does not make them unsaleable. It makes them far more saleable—I draw the House’s attention to my declaration in the Register of Members’ Financial Interests—than they are today and actually affects the value by a relatively small amount.
The hon. Member said, “I am not saying it would not affect the value of that property”, and that is the key. This issue should not be affecting the value of the property when people have saved up for many years, worked hard, bought their flat and then through no fault of their own suddenly finds that the value of their property goes down because of the Government failure to deal with the problem.
Through successive lockdowns, the people in these blocks have gone to bed at night with the added pressure of sleeping in a building at risk of fire or being themselves at risk of bankruptcy and deep financial trouble. It is taking a heavy toll on people’s mental health and putting millions of lives on hold. Leaseholders have been trapped in this impossible position for far too long.
I hate that we are still having this conversation. I hate that I have stood here at this Dispatch Box time after time for years saying the same thing to Ministers, and I hate that good people on both sides of this House are saying the same things and it is still falling on deaf ears. The problem is not going to go away. The Government could legislate today to ensure that leaseholders do not pay by supporting the Lords amendment, the McPartland-Smith amendment or the Labour amendments. At this point, I do not mind which one they pick; I just want the job done.
One of the items that has been brought to my attention is that 57% of flats requiring remediation were purchased for under £250,000, which means that many of those people are living in negative equity in their properties. Does the hon. Lady agree that this is not about cake tomorrow, but about what happens today, and unless the Government accept the amendments that have been tabled, those people will feel that they have no hope for the future?
The hon. Member is absolutely right. We heard from a lady this morning that the cost of insurance for her small block had gone up from £30,000 a year to £500,000 a year. We heard from a lady who lives in a block in Kent—I know one Government Member has stood up for her in this place many times—where the residents have already spent £500,000 on a waking watch. It is quite extraordinary.
I was alarmed to see reports this afternoon that the Prime Minister’s press secretary, Allegra Stratton, has said:
“Our problem with McPartland’s amendment is that, far from speeding things up for constituents across the country who are worried about finding themselves in these properties, it would actually slow things down.”
That mirrors the intervention that the hon. Member for Strangford (Jim Shannon) has made, and it is an absolute cop-out. We are four years on, and leaseholders are struggling. We think that 11 million people are affected by this—not necessarily those living in dangerous blocks, but those living in blocks where they do not know, because they have not got the forms sorted and they are paying more insurance. That is a huge crisis.
Does the hon. Lady recall that in the Opposition day debate called by the Labour party just a few weeks ago, I asked the Minister, if our amendment is defective, why do the Government not take it, fix it, and make it work? They had the opportunity then. Does the hon. Lady think they should have done that?
The hon. Gentleman is absolutely right: if there were any problems with these amendments, they could have been addressed by the Government through this process. They had 12 weeks between the Bill leaving the Lords and coming here to try to effect some of these things, but have chosen not to.
The amendments tabled by the hon. Member for Stevenage (Stephen McPartland) and for Southampton, Itchen (Royston Smith) are to prevent leaseholders from being billed for fire safety repairs. Labour’s amendments went further,