Cladding removal

HOUSING MINISTER Christopher Pincher ‘refused to acknowledge’ any role in the issues around the external wall review (EWS1) forms as a result of the government’s guidance.

Mortgage Solutions reported on the comments by Mr Pincher in parliament in response to a written question from Labour MP Apsana Begum, who had asked what discussions had taken place with mortgage lenders on valuing properties with ‘potential fire safety issues’. Mr Pincher responded that the Advice for Building Owners of Multi-storey, Multi-occupied Residential Buildings guidance – released in January – ‘was written for building owners to ensure the safety of their buildings. It was not designed to be used for valuation purposes’

He added in turn that the EWS1 process ‘was designed by’ the Royal Institution of Chartered Surveyors (RICS) ‘to address lender concerns about cladding in high-rise residential buildings, but industry has applied it more widely than it was intended. Government does not support a blanket use of EWS1. The building safety minister has met with mortgage lenders seeking their support to a more proportionate approach to valuation of multi storey, multi-occupied residential buildings’.

The news outlet noted however that this view was a ‘clash’ with comments from Leader of the House of Commons Jacob Rees-Mogg, who admitted that residents of buildings lower than 18m in height ‘had often been excluded from government measures to tackle dangerous cladding’. The January advice note meanwhile had extended the guidance to ‘all residential buildings’.

Because of this, mortgage lenders ‘protested they must ensure that all buildings are safe for residents and for them to understand the risk they are lending on’, which has led to an ‘extended use’ of the EWS1 form to assess external cladding risks ‘on more buildings than originally intended’. As a consequence, there have been ‘significant hold-ups of months or even years’ due to a shortage of fire engineers.

The guidance stated: ‘“The risk of external fire spread should be considered as part of the fire risk assessment for all residential buildings, irrespective of height. The fire risk assessment should take in to account height, materials, vulnerability of residents, location of escape routes, and the complexity of the building.

‘The explicit remediation advice provided in this advice note should be used to support the fire risk assessment and remedial actions may be required in buildings below 18m where there is a risk to the health and safety of residents, other building users, people in the proximity of the building, or firefighters.’

Last month, Prime Minister Boris Johnson revealed in parliament that a reassessment of the form was being undertaken by RICS, after the news earlier this year that the housing, communities and local government committee (HCLGC) had branded the EWS1 form ‘slow and expensive’, and asked for the government to step in.

This was not only because the process was ‘not working’, but it should create a ‘faster and fairer’ system, because the ‘industry-designed’ form was ‘slow and expensive’ and ‘applied to an unnecessarily wide range of buildings’. The form, introduced last December, aimed to ‘create a standardised process that would make it easier for brokers and homeowners to find suitable mortgages’.

A valuer could request it from a building owner or representative, and require a building professional ‘confirm that the actual material on the walls posed a limited risk or was non-combustible’. Should it contain materials that ‘posed a significant fire risk’, a ‘detailed description of what was needed to fix it had to be issued’, but lenders began rejecting mortgage applications.

This was because of ‘outstanding cladding inspections trapping borrowers with their current providers’, and so applications were being cancelled due to inspection requests being delayed. As a result of the aforementioned government advice ‘a much larger number of buildings’ fell into scope ‘than had been envisaged’, and the process ‘lacked sufficient input from leaseholder representatives, but also other important stakeholders, including the insurance industry’.

RICS urged the government ‘to take greater ownership of the situation’, and more recently, Minister for Fire and Building Safety Lord Greenhalgh held talks with RICS to ‘attempt to resolve confusion’, before Mr Pincher stated mortgage lenders are reviewing how the forms are used, though some residents have been told by housing associations that they ‘cannot produce’ the form for possibly ‘several years’.

Mr Pincher later admitted that there are ‘fewer than 300’ qualified chartered fire engineers to undertake the surveys. Residents have complained publicly including Wisteria Apartments in Londontenants of One Housing properties in London and Sloughresidents of Zenith Close in London, a resident in Hackney and a landlord in Twickenham

In late August, Which? revealed that leaseholders are ‘being duped into paying thousands’ to fraudsters using fake EWS1 forms, with the government notified, and the growing crisis has now seen mortgage brokers report ‘delays and scuppered plans’ for their clients. More recently, a survey of leaseholders found that ‘nearly nine in 10’ or 89% who have received EWS1 checks have been told their buildings require remediation work.

Again last month, it was discovered that the EWS1 form for Marseilles House at Century Wharf in Cardiff was fake, with a surveyor confirming that she ‘had not carried out the survey or signed the form’, and ‘was horrified that the survey took place with her signature’. The company hired to conduct the survey said it ‘only produces a report’ signed off by a third party chartered surveyor for £200, and ‘had also been the victim of fraud’.

That company – Specialist Facade Inspections (SFI) - withdrew every certificate containing the false signature, reviewed each case and reissued each certificate, but was reported yesterday to have provided ‘at least 15 more’ forged certificates – and its new certificates also have signatures ‘from someone apparently not currently registered to sign the forms’.

Most recently, the Fire Industry Association launched a portal that will ‘provide a central readily-accessible location for EWS1 forms’ and allow fire engineers to complete forms online, and the Financial Conduct Authority (FCA) reported that the government and banks are working on a more ‘risk-based’ approach to assessing properties with cladding.

Mortgage Solutions echoed this by adding that Mr Pincher had confirmed discussions with lenders to find a ‘more proportionate approach’ to valuing multi storey properties, but the Ministry of Housing, Communities and Local Government (MHCLG) has ‘publicly criticised’ lenders in written answers yet failed to ‘back up claims or acknowledge any role in the situation’.

It also said he had, ‘on several occasions’, stated some lenders were not using EWS1 forms, but MHCLG ‘refused to name’ these lenders when asked. He has also stated that there have been the aforementioned meetings with lenders and other bodies with Lord Greenhalgh, ‘but has failed to give details of those meetings’.

In a joint statement, UK Finance and the Building Societies Association said: ‘Lenders are acutely aware of the impact that the safety issues related to cladding are causing for some homeowners and continue to collaborate with multiple market actors in pursuit of the best solution for customers. It’s essential that safety risks to homeowners are addressed while balancing the affordability of remediation measures that may become necessary in accordance with government guidance.

‘However, it is only by assessing and fixing buildings which the government advice says are at risk that we can ultimately resolve fire safety concerns. Lenders are keen to see reduced demand for EWS assessments where appropriate to ensure attention is focused on higher-risk buildings. Key to this will be clarification of the government’s advice note to building owners, to support a more proportionate approach by valuers and lenders.’