Why we need a cladding fund for private buildings

In Manchester we have 15 private high-rise buildings with aluminium composite material (ACM) cladding, and we are aware of an increasing number of blocks facing other fire issues, including failed insulation or fire breaks. Under the strict wording of their leases, leaseholders are being held legally liable for remedial works to the tune of over £10,000 each.

When we say leaseholders what we mean in most cases are first-time buyers, young professionals and families taking their first steps on the housing ladder. People for whom these costs are life-changing sums, dwarfing the equity they have invested in their homes.

We have had some positive success working with a tenacious group of leaseholders to challenge the developer Lendlease. Despite losing the tribunal and being told they were liable to pay £20,000 to meet the ACM replacement costs mounted by 340 Green Quarter residents and winning a very public battle, supported by the council, in this case the moral argument won out.

“When we say leaseholders what we mean in most cases are first-time buyers, young professionals and families taking their first steps on the housing ladder. People for whom these costs are life-changing sums, dwarfing the equity they have invested in their homes”

These residents can now breathe a sigh of relief and get on with their lives. However, many of them, incensed by the way they have been treated by the industry, have decided to continue to support other residents across Manchester and elsewhere facing the same fate. In a busy time for UK politics, we are grateful that the housing secretary recently agreed to meet with them and us to hear first hand the experiences of residents and councils on the ground.

The reality is that the Green Quarter residents were lucky. Not every building was developed, built or is owned by a brand-conscious organisation. Some buildings are outside the warranty period and even when they are inside, most insurers appear to be doing their best to frustrate their duty to pay.

Despite there being a number of organisations willing to do the right thing, the industry is sadly full of organisations that are attempting to pass on costs for works to leaseholders in an attempt to protect their own interests.

A widening of existing powers has been introduced by government, enabling councils to carry out cladding remediation work in default, funded by Treasury initially and recharged to the building owner. However, making the case to use these powers is difficult. As a result, we believe they will only apply to 10% or 20% of buildings in Manchester and only where owners refuse to act.

At present, building owners only have to step forward and agree to undertake works and charge the costs to leaseholders in an attempt to step around these powers.

“We should be ashamed as an industry that we will reach the two-year anniversary of Grenfell with only one of our ACM-clad blocks in Manchester undergoing safety works. Tens of thousands of residents across the country will go to bed worrying about their safety and financial futures”

In one case – the Skyline Central One building – residents were recently told they had until 1 April to pay up to £27,000 each. We stepped in to support them negotiate an extension to this deadline with the building owner and challenge a number of the assumptions made, such as VAT and management fees. We are also investigating the opaque ownership of the freehold.

The Green Quarter residents are also supporting the Skyline residents to mount a public campaign, as well as on another scheme: Citygate, developed by Bellway, where a campaign is beginning.

However, despite all of these collective efforts, there is still a very real chance that the residents in more than half of the blocks in our city will need to foot life-changing bills. We should be ashamed as an industry that we will reach the two-year anniversary of Grenfell with only one of our ACM-clad blocks in Manchester undergoing safety works. Tens of thousands of residents across the country will go to bed worrying about their safety and financial futures.

Our key ask of government is to set up a national fund that will pay for cladding works in private blocks, as it has done already for social housing. We also need expanded enforcement powers that work for every case, not just a select few, and we need developers, insurers and freeholders to step up, do what’s right and make the safety of our residents their top priority – over and above profit margins.

Joanne Roney, chief executive, Manchester City Council