Government Response

The Government responded to this petition on Tuesday 13th July 2021

We don’t intend to ban developers from starting new works where buildings have a EWS1 form, but our tax and levy will ensure that industry make a fair contribution to remediation costs.

While the Government agrees that buildings must be made safe, and we have been clear that building owners and industry should make buildings safe without passing on costs to leaseholders, we do not intend to ban developers from starting new works where buildings do not have a EWS1 form.

It is important to clarify that the EWS1 process and EWS1 form is not a Government, or regulatory requirement, and it is not a safety certificate. The EWS1 process was created by industry to help understand if a building may need value affecting remediation work. This information is then used by lenders when making mortgage lending decisions. Buildings cannot ‘fail’ an EWS1 assessment. In March 2021, the Royal Institution of Chartered Surveyors (RICS) published guidance on the use of the EWS1 process. This guidance offers greater clarity and consistency on when an EWS1 should or shouldn't be used. We estimate that nearly 500,000 homeowners should no longer need an EWS1 to sell their property if the RICS guidance - which is supported by the majority of lenders - is followed.

We have seen many responsible developers and building owners stepping up to remediate their buildings and protect leaseholders from costs. In more than half of the cases where there is ACM cladding on private sector residential blocks, the original developer or current building owner has agreed to pay or there has been a warranty in place to cover the costs, therefore protecting leaseholders.

Where they have not stepped up, we have intervened with an unprecedented £5.1 billion investment into building safety to fund the remediation of unsafe cladding for leaseholders in residential buildings over 18 metres. Low-rise buildings between 11 and 18 metres, with a lower risk to safety, will gain new protection from the costs of cladding remediation with a finance scheme, through which no leaseholder will have to pay more than £50 per month.

We are continuing to see an increase in the number of building completing remediation or coming onto site for remediation works thanks to ongoing support and engagement from the Government. 95% of the highest risk buildings with ACM identified at the start of 2020 are now remediated or have work underway.

Now that the significant increase in Government funding and the financing solution have been confirmed, leaseholders and residents in eligible buildings can be reassured that unsafe cladding on their blocks will be replaced. We will soon confirm the underpinning details so we can launch the schemes and ensure buildings are remediated as quickly as possible.

With the taxpayer stepping in to protect leaseholders from remediation costs, it is fundamental that the industry that caused this legacy of unsafe buildings is made to contribute for compromising public safety. That is why the five-point plan announced on 10 February 2021 introduces a developer levy at Gateway 2 stage of the new Building Safety Regime, and a new tax which will be brought to bear on the largest housing developers in relation to the money they make from residential properties. We anticipate that the new tax will raise £2 billion over a decade to help pay for cladding remediation costs.

We are working to develop these areas and are yet to set the rates of the levy. We will be setting out further details of the levy in due course. We intend to consult on the developer levy in the summer and will welcome views to help finalise details of the levy.

Ministry of Housing, Communities and Local Government

The Petitions Committee requested a response which more directly addressed the request of the petition. This revised response replaces an earlier revised response that was incorrectly published on Tuesday 6 July. You can find the original response towards the bottom of the petition page (https://petition.parliament.uk/petitions/574782)