The report, Investigation into remediating dangerous cladding on high?rise buildings, found that while ‘progress is being made’ in removing combustible cladding from high rise residential buildings in the three years since Grenfell, ‘the pace of works has been faster in some types of building than others’, and progress in the private residential sector ‘has been slower than the government expected’.
It noted that post Grenfell, the building safety programme was established by the Ministry of Housing, Communities and Local Government (MHCLG), with one of its main objects to ‘oversee and support the remediation of high-rise residential buildings’ with combustible aluminium composite material (ACM) cladding. It has specifically treated combinations of ACM and certain types of insulation as ‘unsafe’ as ‘it understands’ these ‘would be unlikely to meet Building Regulations guidance’ to ‘adequately resist the spread of fire’.
While £400m in ACM funding was announced in May 2018 for the social housing sector, another £200m was announced a year later for the private sector, but by April 2020 only 149 of the 456 buildings 18m or taller with ‘unsafe’ ACM systems ‘had been fully remediated’, which leaves 307 ‘where remediation was not yet finished’, and ‘work had not yet begun’ on 167.
In total in April, MHCLG reported that there were 154 social sector blocks, 208 private sector blocks, 30 hotels, 54 student accommodation blocks and 10 publicly owned buildings 18m or higher with combustible ACM cladding. Pace of remediation ‘has been fastest’ in the student accommodation and social housing sectors, but slowest in the private sector, with 66.7% of student blocks and 46.8% of social housing blocks ‘fully remediated’ by April, compared to 13.5% of private blocks.
Progress in that sector ‘has been slower because those legally responsible […] have been difficult to identify and have required more support than expected’, with MHCLG having – by April 2020 – paid £1.42m or 0.7% of the £200m private funding and £133m or 33.3% of the £400m social funding. It believes in turn that ‘all buildings within scope of its funding will be remediated’ by mid 2022, with over 95% of these ‘completed by the end of 2021’.
That date is ‘later than the expectation set’ by former Housing Secretary James Brokenshire in July 2019, when he said ‘other than in exceptional circumstances, building owners should complete remediation […] by June 2020’. Whilst this does not take into account the COVID-19 pandemic’s impact, ‘there are early signs’ that it has ‘slowed the pace of remediation’, with up to 60% of projects under way paused by April 2020.
At this point in time, the NAO added, MHCLG has ‘not’ assessed ‘how its timeframe for completing remediation will be affected’. Moving on, the NAO report said that not all buildings with combustible ACM ‘fall within scope’ of the existing funding schemes, such as high rise hotels, student blocks and build to let blocks, alongside buildings under 18m. MHCLG is apparently aware of seven build to let properties taller than 18m with unsafe ACM ‘which are not eligible for funding’.
This is because the private sector funding scheme ‘is designed to avoid the costs of remediation being passed on to leaseholders’, and it believes that building owners ‘have a clear legal and financial obligation to pay for remediation themselves’. One of the seven aforementioned blocks ‘has now been fully decanted’, it added.
With MHCLG’s independent expert advisory panel having advised that the ‘most dangerous forms’ of ACM are unsafe ‘on buildings of any height’, it has also warned risks ‘are increased in buildings with elderly and vulnerable residents’. It estimates that there are around 85,000 buildings in England between 11m and 18m, ‘but does not know what cladding systems they have, nor whether there are any care homes under 18 metres with unsafe cladding’.
On that note, MHCLG ‘will begin collecting data on buildings between’ those heights this summer, and returning to the funding and access to it, the NAO report said that building owners ‘must demonstrate they have made a reasonable attempt to meet or recover costs without having to charge leaseholders’, by paying for work ‘from their own resources, or through insurance, warranty claims or legal proceedings’.
MHCLG ‘expects’ that it could take owners ‘several years to recover costs’ from legal proceedings ‘in many cases’, and as of February this year MHCLG had ‘recouped’ £0.8m from the private sector alongside £6.4m from the social sector, ‘where building owners had successfully reclaimed costs from original contractors’. It expects to fund 94 of 208 private sector projects ‘where the developer or building owner has not agreed to fund remediation’, while 23 would self fund through warranties.
Another seven buildings ‘have not agreed a funding route’, while in the social sector MHCLG has ‘committed’ to fund 139 of 154 residential buildings. The NAO report also acknowledged the £1bn in extra funding announced in March for combustible, non ACM cladding, but said that MHCLG ‘has not yet established’ how many buildings over 18m are affected, using a ‘rough initial estimate’ of ‘around 1,700 such buildings as a working assumption’.
While MHCLG ‘intends to commit’ the £1bn ‘in full’ by the end of March 2021, ‘the administration of this new scheme may present significant challenges given how demanding it has been to manage the existing ACM funding schemes’, which are ‘just over half the size of the new fund’.
Gareth Davies, head of the NAO, said: ‘MHCLG has made progress in overseeing the removal of dangerous cladding from many buildings, particularly in the social housing sector. However, the pace of progress has lagged behind its own expectations, particularly in the private residential sector. It has a long way to go to make all high-rise buildings safe for residents.
‘Going forward, it is important that the Department successfully manages the administrative challenges of funding building owners to carry out remediation work, particularly given its intention to commit a further £1 billion in full by the end of March 2021.’
Meg Hillier, chair of the Committee of Public Accounts, added: ‘Three years on from the Grenfell Tower disaster, two thirds of high rise buildings with the same sort of cladding haven’t replaced it. This work should have finished already. The deadlines for removing other dangerous cladding are unrealistic, and there may not be enough people with the right skills to do everything that needs to be done. Developers should be footing the bill for this work, not taxpayers.’