The Minister of State, Home Office and Department for Levelling Up, Housing & Communities (Lord Greenhalgh) (Con)
I thank the noble Lord for bringing this debate forward. It is obviously an important issue to discuss, and I am sure we will discuss it many times in the coming months.
The Government are determined to make housing greener and more affordable and to make sure people feel safe in their homes. As noble Lords have commented, the Government have committed an unprecedented £5.1 billion investment to building safety. In fact, the estimates are that this is already three times the amount, in today’s money, that was invested by the Government in the 1980s through the Housing Defects Act which my noble friend Lord Young mentioned. This commitment is three times greater than the sums spent at that time, so we should recognise that this is a substantial amount of money.
This investment is obviously focused on high-rise residential buildings 18 metres and above. It is right that we prioritise action and funding on the higher-rise buildings, where risk to multiple households is greater when fire spreads. The fire risk is lower in buildings under 18 metres, and costly remediation work is usually not needed. Where fire risks are identified, they should always be managed proportionately.
This Government remain committed to protecting leaseholders from unaffordable costs, and the new Secretary of State is looking very closely at this issue to make sure everything is being done to support leaseholders. It is important to remember that government funding does not absolve building owners of their responsibility to make sure that their buildings are safe. They should consider all routes to meet costs, protecting leaseholders where they can.
In order to unlock the mortgage and housing market for leaseholders in blocks of flats, the Government commissioned experts, including Dame Judith Hackitt, to advise on a risk-proportionate approach. They concluded that there has been an overreaction from some areas of the market and that EWS1 forms are not required for buildings below 18 metres. The Government support this and have a clear expectation that lenders will respond with further proportionality when lending on flats in such blocks.
It is fundamental that those who will gain from the restoration of confidence in the housing market help fund the significant costs associated with fixing buildings when they are unsafe. That is why the Government are introducing a new building safety levy on developers and a new residential property developer tax, which will contribute towards fixing historical fire safety defects. My noble friend Lord Young cited the sum of £1 billion, but in fact it will raise £2 billion. This tax will be levied on developers with profits over £25 million at a rate of an additional 4% on their corporation tax.
The Government are also establishing the biggest reforms of building and fire safety in nearly 40 years through the Building Safety Bill. The legislative changes we are making through the Bill will help to rectify the problems identified with the current building and fire safety regime and make homes safe. It will adopt the golden thread principle that the noble Lord, Lord Stunell, believes is so essential to see a better built environment.
Leaseholders and residents are at the heart of these reforms. Legislation within the Bill requires building owners to explore alternative ways to meet the costs of remediation works before passing these on to leaseholders, along with evidence that this has been done. If this does not happen, leaseholders will be able to challenge these costs in the courts.
Those responsible for high-rise residential buildings when they are occupied will be required to actively manage building safety risks, evidencing this through a “safety case” regime. The new building safety regulator will also have new powers to make sure that those who are responsible for the safety of high-rise residential and other in-scope buildings are held to account if they fail to do the right thing. A principal accountable person and accountable persons will be identified in each high-rise residential building, with responsibility for ensuring that their buildings are safe. Residents will have an established route, via the accountable person, to raise safety concerns about their building, with a further right to escalate complaints to the building safety regulator.
The Building Safety Bill will also create a stronger and clearer construction products regulatory regime that will require all products on the market to be safe, accurately labelled and traceable, and introduce more stringent requirements for safety-critical products. The national regulator for construction products will oversee this more effective construction products regulatory regime, so that people can be confident that construction products, including those used to construct our homes, are safe and perform as they should.
Legislation will also require developers of new-build homes to belong to the new homes ombudsman, which will have powers to investigate complaints and to enforce its determinations, which could include requiring compensation to be paid or even to expel a developer from the scheme if necessary. I continue to engage with leaseholders on these subjects. I have met very frequently with them, and recently the Secretary of State and I met with leaseholders and cladding groups, heard their views and discussed what the Government will do to protect them from unaffordable costs.
The noble Lord, Lord Stunell, commented on the importance of climate resilience. We are committed to improving the energy performance of all our properties, not only to reduce emissions and fuel poverty but because warm homes are healthier homes. The Government recently announced that £800 million has been committed for the social housing decarbonisation fund, and £950 million of additional funding for the home upgrade grant over the next three financial years, supporting retrofit for social housing residents and low-income households. We will also support households to install low-carbon heating, such as heat pumps, through our new £450 million boiler upgrade scheme. From 2025, homes built to the future homes standard will be expected to have at least 75% lower carbon emissions and be zero-carbon ready without the need for expensive retrofitting.
By improving standards, such as strengthening energy efficiency requirements and supporting those least able to pay through our targeted grant schemes, the housing sector can support higher standards of living and create new jobs, helping us to unite and level-up every region of our country. This is not an easy task, but it is vital that we keep up the momentum. The department has taken the lead on many aspects of this work, but the responsibility is a shared one. It lies with product designers, developers, building owners and managers, and local authorities, as well as with central government, to ensure that homes and buildings are safer, greener and more decent, in every part of our country.
I thank all noble Lords for their contributions and will now respond to the points raised. The noble Lord, Lord Stunell, and the noble Baroness, Lady Pinnock, raised the issue of interim measures, particularly the costs of waking watch. We have committed an additional £5 million, so now have £35 million in our waking watch relief fund. The published data shows that 281 buildings and 22,000 leasehold dwellings are already benefiting or will benefit from the fund, and £24.1 million has already been provided.
The noble Lord, Lord Stunell, wanted an update on the finance scheme that we have raised for medium- rise buildings. I mentioned that the fire risk is lower. We have a new Secretary of State who is looking closely at this issue to ensure that everything is being done to support leaseholders. This will be informed by new data from further survey work to understand the prevalence of unsafe cladding in medium-rise buildings between 11 and 18 metres. With this new data, the Government will have a stronger evidence base to support building owners in making their buildings safe without passing unaffordable costs on to leaseholders. An announcement will be made relatively shortly.
The noble Lord, Lord Stunell, also raised the issue of non-cladding building defects, poor compartmentation, cavity barriers, firestops and fire doors. Clearly, those non-cladding defects are designed to stop fire. They do not accelerate the spread of fires that we see with our external wall systems, as tragically happened at Grenfell. We are focusing our funding on remediating unsafe cladding. However, this also includes all those works which are integral to the safe removal and replacement of the unsafe cladding system, which can include fire cavity barriers where they are integral to the system.
The noble Lords, Lord Stunell and Lord Thurlow, want to see leaseholders protected, and many noble Lords have mentioned this. This will be improved through the Building Safety Bill, and I have stated very clearly why.
One measure that I think is most important is the extension of the Defective Premises Act 1972 from six years, which is a woefully short limitation period, to 15 years retrospectively. That is an important measure to enable us to secure redress from those who built these buildings very shoddily.
The right reverend Prelate the Bishop of London wanted to know when all non-ACM cladding would be removed. The Government acknowledges that the remediation of unsafe cladding is complex. We still expect remedial works to progress at pace and for building owners to take seriously their responsibilities for making their buildings safe. That is not exactly giving noble Lords a timeframe, but we have already committed through the building safety fund to 689 buildings that are eligible for funding, and to what equates to about £2.7 billion of funding. That will take some years, and probably go beyond the spending review period. We will make considerable progress in the next two to three years, but we should have an expectation that it could take longer, just because of the sheer number of buildings involved. But already, with those 689 registrations that are eligible for funding, we are talking about 65,000 homes and properties in high-rises, which will have their cladding remediation funded. That is in addition to the 16,500 homes that have been funded to remove the very same cladding—the ACM—that Grenfell Tower had.
We are seeing considerable progress. I do not think it is happening at a snail’s pace, if you are going through a pandemic, to have nearly 5,000 homes clad in ACM remediated in the last year—4,700 in the last year alone, which is up to 16,500 homes, with an expectation that around 95% of high-rises with ACM cladding will be already remediated or having work under way by the end of this year.
I credit Steve Day for his tireless efforts to promote the polluter pays amendment, and I thank the right reverend Prelate the Bishop of London, the noble Earl, Lord Lytton, the noble Lord, Lord Thurlow, and my noble friend Lord Young for discussing that issue. We are well aware of it—in fact, I am almost in touch with Steve Day in real time. Our officials in the department are working closely to see whether we can work with the principle that he has worked up. We are looking for all ideas that can bring about a strengthening of redress and ensure that the polluter does pay.
The noble Lord, Lord Stunell, put in a quick request to know how many of our EWS1 assessors had been trained as a result of the RICS scheme to date. The first cohort of 50 have finished their training; the funding was £700,000 for 2,000 EWS1 assessors, so 50 is not a huge number, but there are now over 950 candidates on the course, so we are going to see that number increase in the coming months.
The noble Lord, Lord Stunell, and the noble Baroness, Lady Pinnock, asked about what is actually the publicly available specification, not the standard, from the British Standards Institute. They wanted to know when the PAS 9980 would be available, and my answer is that this will happen shortly. That is a very ministerial answer these days. I would love to give noble Lords the exact date. It is designed to be the very risk-based assessment that she requested, because it takes external wall systems and grades the risk into high, medium and low. Therefore, you can then get the consistency to know those buildings that are at high risk, those at medium risk and those at low risk. It is important that at that stage we are comfortable—and we have committed to withdraw the consolidated advice note at that point.
In addition, under the new Fire Safety Act that passed through this House—I have the scars to remember that experience by—the updated fire risk assessment on buildings will look in the round at what needs to be done to make a building as safe as it needs to be. Very often, that will not need to be costly remediation but will be mitigation measures. So, it is a package of things: it is the new PAS 9980 and an updated fire risk assessment that will help drive greater proportionality.
The noble Lord, Lord Stunell, mentioned timber-framed housing. We recognise that timber-framed construction can reduce carbon emissions where it is safe to do so, but we are clear that buildings must be well designed to meet building regulations and resist fire spread, and to make sure this happens, we are committed to creating a stronger and more effective regulatory regime.
Now we get to where the noble Lord, Lord Shipley, expertly widened the scope of the debate beyond building safety and wanted to know whether the Government were committed to the 300,000 housing target. I can state categorically that the Government remain committed to delivering 300,000 homes a year. That is why we saw an additional £1.8 billion for housing supply, unlocking more than 1 million new homes, in the recent Budget. That means that we will see, overall, a £10 billion investment in housing supply, unlocking those 1 million homes. That is a considerable amount of money, I am sure the noble Lord will agree.
The noble Lord also raised homelessness and rough sleeping. The spending review saw resource funding for homelessness and rough sleeping increase to £639 million per year by 2024-25, which is an 85% cash increase compared with 2019-20. You can always spend more money, but there is no doubt that there is a real ambition in this Government, recognising that rough sleeping has dropped by 43% in recent years. There is a real commitment to end rough sleeping: there is always more you can do, but we have made significant strides and put in further commitment to ensure that the progress continues.
I note that there is a strong agreement that leaseholders need to be protected and housing kept safe and affordable, and I look forward to continuing the work with this House so we can continue to deliver building safety reforms and do all we can to protect leaseholders, who I accept are victims in this crisis.