In the House of Commons earlier this week, Secretary of State for Levelling Up Michael Gove (pictured) outlined the 39 developers who has signed remediation contracts and 11 who had not yet signed.
The Department for Levelling Up had given developers a six-week deadline at the end of January to sign contracts to fix unsafe buildings. The signed agreements will raise around £2bn for remediation costs.
He noted that details of the Responsible Actors Scheme would be unveiled next week and that he had written letters to the directors of the 11 housebuilders who had not signed contracts.
The scheme would allow the Secretary of State to “block developers who have not signed the contract or failed to comply with its terms from carrying out development and from receiving building control approval”, according to the Department for Levelling Up.
It continued that this would “prevent them from operating as normal in the housing market for as long as they do not resolve the problems of the past”.
Gove said: “Those companies will be out of the house building business in England entirely unless and until they change their course”
He added that he wanted to allow some of the 11 who had not signed a “little leeway to ensure that they live up to their responsibilities”.
However, he said that for those that have not signed by the appropriate time, the government would use powers in the Building Safety Act 2022 to issue remediation orders to force them to fix their buildings.
Gove continued: “Actions have to have consequences. The overwhelming majority of developers have done the right thing by signing this contract. It would be wrong for anyone who has wriggled out of their responsibilities to be allowed to continue to make a profit when others are shouldering these responsibilities.
“It is the case that if a company is not on…the goodie list, that will be it — development will have to pause, and we will make sure that their shareholders and investors pay the price for the irresponsibility of their directors.”
He continued that “all life-critical features in medium and high-rise buildings will be addressed by developers”.
Regarding buildings under 11 metres, Gove said that it may be the case that it has “some fire safety issues”, but the government would “have to look at them case by case — some will be life-critical; some will not”.
“We need to look proportionately at each building, and that takes time,” he added.
Government working on ‘bespoke solutions’ for non-life critical defects
When asked about non-qualifying leaseholders, such as people with more than one property, Gove said: “We wanted to attempt to draw the line in order to ensure that, for example, significant investors — people with significant means — were not benefiting from a scheme that was designed for every man and woman, as it were.”
However, he added that some constituents who lived in buildings below 11 metres or who lived in enfranchised buildings and did not qualify, so it was “looking at the situation to try to make sure that we do not have people at the margins who are being treated unfairly”.
Gove said that the government was working on “bespoke solutions” for buildings that fell outside of “life-critical safety defects” categories.
He continued that he believed that developers were “living up to their responsibilities” to deal with such life-critical issues in medium and high-rise buildings.
Gove added that he hoped to update the House on progress it was making with the FCA and others on excessive insurance charges for leaseholders, adding that there “broader issues in the insurance market that we need to address”.
Gove was also asked by Lisa Nandy, Shadow Secretary of State for Levelling Up, whether he would abolish leasehold, which she described as a “feudal system that has no place in a modern society”.
He said he hoped that this was an area that he wished England would catch-up with Scotland on, as it was “more progressive”.
