Residential Leaseholders and Interim Fire Safety Costs

Mike Amesbury Excerpts

Wednesday 10th March 2021 Westminster Hall

[Mike Amesbury (Weaver Vale) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Vauxhall (Florence Eshalomi) on securing the debate and on her continuing fight for leaseholders across her constituency. I also thank her for focusing this debate on an aspect of the building safety crisis that has received less attention in the House but is equally financially crippling, as she has argued, for leaseholders up and down the country.

In fact, I thank the 16 Members who have contributed very powerfully to the debate today. My hon. Friend the Member for Edmonton (Kate Osamor) referred to the astronomical insurance costs piling on to leaseholders in her constituency. The hon. Member for Harrow East (Bob Blackman) argued that manufacturers that have gamed the testing system should contribute by paying for interim measures and more. My hon. Friend the Member for West Ham (Ms Brown) spoke about the nightmare that is the EWS1 system, and debt piled on top of debt in the midst of the covid crisis.

The costs for leaseholders have dominated the headlines over the past few years. We are nearly four years on from Grenfell, where 72 people tragically lost their lives, but today’s debate demonstrates the importance of breaking the costs down to expose exactly what constitutes the unimaginable debt being imposed on leaseholders for defects that they did not cause. People are literally going bankrupt.

Across the country, leaseholders are trapped in dangerous buildings. They are unsure of when their home will be made safe or how much that will cost them, but as soon as a building is judged to be unsafe, as my hon. Friend the Member for Vauxhall pointed out, the costs start piling up. Additional safety measures, often in the form of 24-hour waking watches, are put in place, and leaseholders have little choice but to foot the bill—they either do so or become homeless—which is £174 million a year. Far from being temporary, as the word “interim” would suggest, there are waking watches that have now been in place for years, and they will probably be in place for even more years to come. The cost for each leaseholder is more than £500 a month on average and, in many cases, much, much more, as we have heard throughout today’s debate.

After refusing repeatedly to help leaseholders to cover these costs, the Government have now provided some—I say “some”—funding to fit alarm systems in some buildings, those that are 18 metres and above in height. That will reduce the need for a waking watch, but once again, the Government’s actions have come far too late and fall far short of what is needed. We know that waking watches are present in about 800 buildings, but the £30 million provided by the Government will cover at most 460—a figure far lower than the number of buildings with waking watches in London alone, as my hon. Friend pointed out. Does the Minister think that, when it comes to safety, this type of funding lottery is right? I am also concerned by reports that even after fire alarms are installed, evacuation managers are required in some blocks and, again, it is leaseholders who are left paying the bill. Can the Minister say whether he has looked into how many buildings this actually impacts?

Safety costs are, of course, not the only interim costs that leaseholders are incurring. A survey from the Association of Residential Lettings Agents—my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) referred to this— has found that insurance costs have risen on average by 400%. For one in 10 blocks, the cost of insurance is now 10 times or more what it was just a year ago. This is a picture that takes us from Sheffield, where a building is uninsurable, to Manchester, to Birmingham and to London. Hikes of 1,000%-plus are not uncommon.

Lord Greenhalgh, the Minister responsible for building safety, is due to meet insurers in yet another roundtable this week. Can this Minister confirm whether that roundtable will be the one that finally sorts out the problem and intervenes in the insurance market? Ultimately, the only way to stop interim costs continuing is to get buildings safe quickly. Some are still left worrying whether, when that day comes, they will be left with a bill not just for cladding, but for a host of fire safety defects not covered by the building safety fund, as pointed out by hon. Members in this debate today. Many buildings below 18 metres will now be saddled with an unwarranted and unwanted loan on top of interim costs—mortgages, service charges and much more.

We were promised details of the Government’s new funding at the Budget by the Minister himself, but yet again leaseholders were let down. The Chancellor did not even bother to mention cladding or the building safety crisis. Will the Minister take the opportunity today to do what the Chancellor did not do and provide us with details of the new arrangements, and how about updating my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) on co-operation with the Welsh Government? Costs for leaseholders go far deeper than the financial cost. As my right hon. Friend the Member for Hayes and Harlington (John McDonnell) pointed out, mental health and stress are taking a toll. These are all consequences of the scandal as the bills pile up.

Nearly four years on after Grenfell, the very first step that the Government should have taken, which they still have not done, despite our repeated calls, was to establish the extent of the crisis and properly prioritise buildings according to risk. They have not provided sufficient upfront funding to start getting dangerous cladding and other materials off these buildings immediately. They have not protected leaseholders from the costs, as promised over and again. It is about time the polluter genuinely does pay for the building safety scandal. I hope the Minister will answer the questions asked by me and other hon. Members today.