Update on government negotiations with developers

The Secretary of State for Levelling Up, Housing and Communities, Michael Gove, has provided an update on his negotiations with developers around ensuring that those responsible for the building safety crisis pay to fix it. This follows his promise in January to update the Houses of Parliament on the progress of the negotiations.

Developers pledge to remediate buildings they constructed

The Secretary of State has been calling on housebuilders to pledge to fix buildings that they originally constructed. The Department for Levelling Up, Housing and Communities (DLUHC) has confirmed that 35 of these firms have so far signed the pledge to remediate all buildings 11m and over that they have created in the last 30 years. Mr Gove is calling on remaining housebuilders to sign the pledge, and has warned that there could be commercial consequences for those that don’t.

You can read the list of developers that have signed up to the pledge here. In a letter confirming their commitment, developers are committing to submit plans to DLUHC within one month setting out how they will notify building owners and leaseholders of buildings they plan to self-remediate.  

Extension to the Building Safety Levy

In January, the Secretary of State that DLUHC would set up a £4bn fund, sourced from developers, contractors and cladding manufacturers, to pay to remediate buildings 11m and over with safety defects. The proposed fund is now intended to pay for ‘orphan’ buildings where there is no original developer. The government proposes to fund this through an extension to the Building Safety Levy, which would apply to all new homes regardless of height.

The Building Safety Levy had previously been intended to apply to buildings 18m and over, and would have been payable as a condition of planning permission. In its consultation, the government had proposed exempting affordable housing from the levy. The NHF submission to the consultation argued for all housing association activity to be exempt from the levy so as not to affect the viability of mixed tenure housing schemes, and to be in line with the new Residential Property Developer Tax.

The government has not yet responded to its consultation on the Levy. We are seeking further conversations with DLUHC officials on this change, particularly on the potential impact of affordable housing supply.

We will continue to keep you updated on our conversations with government around ensuring that those responsible pay to fix the building safety crisis.