Fire Safety Bill

Lord Greenhalgh Excerpts

Consideration of Commons amendments
Tuesday 27th April 2021 Lords Chamber

Moved by

[Lord Greenhalgh]

That this House do not insist on its Amendment 4J, to which the Commons have disagreed for their Reason 4K.

4K: Because the issue of remediation costs is too complex to be dealt with in the manner proposed.

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[The Minister of State, Home Office and Ministry of Housing, Communities and Local Government (Lord Greenhalgh) (Con)]

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)

Moved by

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[Lord Adonis (Lab)]

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.

[Lord Greenhalgh (Con)]

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.