Leaseholders and Cladding

Geraint Davies Excerpts

Wednesday 12th February 2020 Westminster Hall

[Geraint Davies (in the Chair)]

Before I call Hilary Benn, may I simply say that 13 Back Benchers wish to contribute? In the event that Mr Benn speaks for 20 minutes, everyone will have three minutes; in the event that he speaks for 10, everyone will have four. He is free to take as much time as he likes, and I will divide the remaining time equally between Back Benchers. Obviously, interventions will take time, but they will not result in more time for Back Benchers. I call Hilary Benn to move the motion.

[Hilary Benn (Leeds Central) (Lab)]

I beg to move,

That this House has considered leaseholders and cladding.

May I say what a great pleasure it is to serve under your chairship, Mr Davies? I am grateful to all colleagues present. I know that a number will wish to intervene, but the more interventions there are, the longer I will take to complete my argument, which I am keen that the Minister should hear. I think the turnout shows her the strength of feeling on this issue.

It is not difficult to understand why there are strong feelings. Imagine that someone has saved up all their money and bought their first flat. It is the home of their dreams. They move in, the future beckons, and then one day a letter drops on the mat. It is from their managing agent, and it tells them: “Your home is in a building that has now been judged a fire risk because of unsafe cladding, and as a leaseholder you must immediately—this day—start paying for a waking watch. Otherwise, all of you will have to move out of your homes.” In one case in Leeds, such a waking watch is costing each flat-owner £670 a month plus VAT, on top of mortgage payments and the service charge.

The leaseholder is probably then asked to meet the cost of putting in a fire alarm system, which may or may not reduce the cost of the waking watch. Then, to their absolute horror, they are asked to pay for the cost of replacing the dangerous cladding to make their building—their home—safe. The problem is pretty obvious to us all: they simply do not have that kind of money. Their home has been rendered completely worthless, therefore they cannot remortgage. Their insurance premium is, in all likelihood, going up, and they worry about possibly being made bankrupt because of all the costs. That could result, depending on what job they do, in the loss of their job as well as their home. Yet none of that is in any way the fault, responsibility or doing of the leaseholders.

--- Later in debate ---

[Several hon. Members rose—]

[Geraint Davies (in the Chair)]

That will be addressed in three minutes by Sir Robert Neill.

--- Later in debate ---

[Fleur Anderson]

I absolutely agree. There has to be a way to make the fund easy to use and urgently accessible, so that it is not held up for a long time in red tape, and the right people have to foot the bill. I argue that the Government need to extend the cladding fund to all types of unsafe cladding. That is what it is there for.

As to the emotional toll, one person said:

“The net result for me is that I will lose my home, as I cannot sell it, or raise a mortgage to finance repairs because it is unsellable and I am unemployed, and therefore will lose my lease.”

He will become homeless as a result. Another resident told me that his flat is unsaleable and effectively worthless. It was bought in 2004 in good faith in the belief that it was a safe home. The fact that it is now considered to have the problems in question is not of his making:

“We cannot afford to pay a sum of this size on top of the existing service charge”.

In summary, I am as shocked as everyone else here. I hope that the Minister will urgently tell us some good news. Three years after Grenfell, my constituents are being asked to fork out huge sums of money for a building that ultimately they do not own—a point that relates back to the leaseholder crisis. No leaseholder should have to pay for the work in question, or experience such huge stress and uncertainty. An urgent response is needed. I join those who are asking for the cladding fund to be urgently extended to all forms of unsafe cladding.

[Geraint Davies (in the Chair)]

I thank Members for their collective discipline in time management, which has given us just over half an hour for the Front-Bench speakers.

[Alison Thewliss (Glasgow Central) (SNP)]

It is a pleasure to see you in the Chair, Mr Davies. I congratulate you on your expert chairing of the debate, which has allowed many Members to have their say. I will try to limit my comments so that Members can intervene on the Minister, if required.

I approach the debate from a slightly different angle, because we do not have the leaseholder/freeholder issue in Scotland, although we have continuing issues with cladding. We also have issues over which the UK Government have had an influence but have not had the best communication with the Scottish Government. The Scottish Government have ended up with a problem not of their making that they are struggling to put right. Finance and insurance are obviously reserved to Westminster, and the Scottish Government have limited influence on the actions of mortgage companies, banks and insurers.

I turn first to advice note 14, which pertains to fire safety in buildings post Grenfell. It was introduced following very limited consultation with the Scottish Government, which means mortgage lenders now insist that cladded properties over 18 metres high have specific documentation to evidence how well they comply with safety standards. Most properties built in Scotland in the past five years comply with the safety standards set out by the Scottish Government. Our fire standards and building regs are better and more comprehensive than those in England, so we do not have a problem of the scale that right hon. and hon. Members have identified. Without the requisite certification, however, people cannot meet the new standards now being imposed by lenders. As a result, surveyors who have been instructed to compile home reports—it is a routine exercise when properties are sold or remortgaged in Scotland—have found that they have been imposed with nil valuations.

Constituents across the country, including many in my constituency of Glasgow Central, have spoken in terms similar to those used by right hon. and hon. Members: about not being able to sell their properties or to remortgage. As right hon. and hon. Members have mentioned, in some cases house sales have fallen through, leaving residents out of pocket.

The hon. Member for Brentford and Isleworth (Ruth Cadbury) described how somebody could not take up a job. I know of somebody who had arranged to move to Poland with his Polish wife, but their house sale fell through at the last minute. All the arrangements had been made to move to Poland, but they now cannot sell their home and are stuck. Despite the vast majority of properties being certified by council building control departments, many surveyors refuse to commit to a valuation without seeing specific certification on the cladding.

In response, the Scottish Government have written to the Ministry of Housing, Communities and Local Government four times: on 18 October, 8 November, 19 December and again on 27 January. As far as I am aware, that correspondence has not yet been formally responded to, which is completely unacceptable. I hope the Minister will address this issue, if she can. The correspondence from the Scottish Government underlined their willingness to work in collaboration to find a suitable solution that works for the particular set of circumstances in Scotland, but we do not seem to have got very far. The Scottish Government have highlighted that, although they appreciate that MHCLG has introduced the EWS1 form to bring about a resolution, it relies in some respects on a tenure system that does not exist in Scotland. That needs to be addressed.

My constituents have raised their concerns about a number of properties in Glasgow Central, including Lancefield Quay, which was built in phases and has different issues across those phases. The right hon. Member for East Ham (Stephen Timms) talked about having different types of cladding on a single building, which highlights that the whole building, rather than just one type of cladding, needs to be considered.

My constituent Lisa Jamie Murray has been working incredibly hard to highlight the situation at the Templeton Building next to Glasgow green, because there is non-compliant ACM on the top two floors alone. As far as I am aware, it was compliant at the time of construction and conformed to the regs in place when the building warrant was obtained, but it seems that some of these things have been missed over time. There has also been a change to the building, which means that there is essentially a line of cladding up its side that would act almost as a chimney. If there were a fire at the bottom of the building, it would scoot up the outside of the building and on to the top, which is terrifying.

It has been incredibly difficult for the residents of the building to ascertain who is responsible for the cladding. Is it the original developer, or somebody who made the changes in between times? Do the residents now have to take this up and face the costs that right hon. and hon. Members have mentioned? It is incredibly difficult to make sure that we can reach a solution. It is very important, particularly because this is based at Glasgow green and there are lots of events there; it is a very busy part Glasgow.

I turn to some of the issues raised by advice note 14. Right hon. and hon. Members have hinted at some of the issues with inspections needing to be carried out by a qualified certificated body, and there are capacity issues in the industry. As the hon. Member for Hackney South and Shoreditch (Meg Hillier) mentioned, perhaps we need to consider bringing more experts into the country to address that. We could make adjustments to immigration as well, because the industry does not have the people to do this. Time is pressing and money is a factor, and we need to find a way to reach that point.

The new consulted advice note, issued in January, introduced a fundamental change because it applies to all multi-storey and multi-occupied buildings, including those under 18 metres, which brings a whole load of extra buildings into scope. Inside Housing highlights the increased burden, saying:

“Compliance with the advice note and recovering costs both require expert evidence from a limited pool of fire engineers and forensic architects, and place an additional administrative and financial burden on building owners.”

What is the Minister doing to meet the challenge? Without the adequate people to do that, we will be waiting for a long time.

Listening to residents is fundamentally important. Dame Judith Hackitt mentioned that the Scottish Government have listened well to residents in order to forge their response. The Scottish Government’s Fire Safety Committee is still meeting and taking on concerns. I ask the Minister to listen closely to MPs and residents right across the country, and to bring a response that meets those needs. It is clear that the fund being set up is far from adequate. It is far from being wide enough in what it encompasses, and the Minister needs to consider expanding it very soon so that people can get on with the work.

Lastly, I echo the words of the hon. Member for Newton Abbot (Anne Marie Morris), who called for a VAT exemption. I have asked for a VAT exemption on multiple occasions in the Chamber. The Budget is coming up, and there is an opportunity to remove VAT from sprinkler systems, cladding and house repair systems. If the Government were to do that, it would be a huge help to people who want to get work done quickly.

[Geraint Davies (in the Chair)]

We now have the pleasure of listening to my old friend from Croydon Central, Sarah Jones.

3.37 pm

[Sarah Jones (Croydon Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies, and I congratulate my right hon. Friend the Member for Leeds Central (Hilary Benn) on securing what is clearly an incredibly important debate. We could spend many hours talking about leaseholders and cladding, which reflects the scale of the problem right across the country.

As right hon. and hon. Members would expect, I spend quite a lot of time talking to leaseholders, whether through the all-party parliamentary group on leasehold reform, the Leasehold Knowledge Partnership or the UK Cladding Action Group. I have had the privilege of talking to many of them about some of the issues they face. As has been articulated so well, these are lives that have been turned upside down completely due to issues for which they bear no fault. What they bear is the cost, anxiety and stress. Their lives are on hold, and it is incredibly upsetting for everyone who has been involved.

It has been nearly a thousand days since the Grenfell Tower fire, and since then we have had two Prime Ministers, three Secretaries of State and four Housing Ministers—everything but a partridge in a pear tree. We might have another reshuffle tomorrow. Hopefully we will not, because we want the Ministers and the Secretary of State to stay and fix some of the problems.

Most of the issues have been explained well in the debate, so I will focus on some particular questions to the Minister. If she does not have time to answer them all today, it would be great if she could write back to us. My first point is about the remediation of ACM cladding, which has been talked about a lot. We know that nine in 10 private blocks with Grenfell-style cladding are still covered with such cladding.

--- Later in debate ---

[Sarah Jones]

That is absolutely correct. There is a whole raft of areas in which different evidence is gathered and different work needs to be done. There are questions about all those things. We do not know whether the people doing waking watch are doing it properly and are properly trained. We are spending money on things that we are not sure about. The lack of people doing those jobs is an important issue.

The announcement on 20 December that the height limit for removing ACM had shifted from 18 metres to 11 metres means that there are potentially thousands more blocks implicated in the cladding scandal than originally thought. That means that tens of thousands more leaseholders, who previously thought their blocks were safe, have now discovered that work needs to be done and that the Government do not deem their building safe. Additional safety requirements are welcome, but when it comes to building safety, it is unclear why the Government took two and a half years to decide that buildings between 11 metres and 18 metres were equally unsafe. Will the Minister clarify why they took so long to determine that blocks of that height should also have their cladding removed? Does the Department know how many residential blocks of between 11 metres and 18 metres exist across the country? How many are covered in Grenfell-style cladding? If the Government do not know how many blocks are covered, is there a plan in place to collect and publish that information, as has been done with blocks of 18 metres and above?

For two and a half years, we have had a merry-go-round of buck passing, and hundreds of thousands of people across the country are suffering as a result. It is disappointing that the Secretary of State was not asked about this more when he was doing the media rounds at the weekend, and that we have not seen more action. It is also disappointing that the Government are not engaging with leaseholders. A meeting in London was recently organised by the Leasehold Knowledge Partnership, and 100 leaseholders were there. They were asked whether they have had regular engagement with Ministers, and not a single hand went up. We need to talk to people so we can understand the issues that they are facing.

If the Government are serious about the claims and pledges they made in the days and weeks following the Grenfell Tower fire, about their role in keeping people safe, about their commitment to homeowners, and about the principle that leaseholders should not be paying, it is time to act. I know this is difficult. It is a very big problem, and it will be very complicated to solve. If the Government act and do the right thing, the Opposition would thank them very much for doing so.

[Geraint Davies (in the Chair)]

I now invite the Minister to answer all those questions. She has about 12 minutes, and perhaps she can allow a minute or so for Hilary Benn at the end.