A raft of fresh amendments proposed to the Building Safety Bill would give government power to block planning permission and building control sign-off on developments, effectively preventing developers from building and selling new homes.

The proposals will give legal force to plans to make the industry pay to fix historical problems, while also enforcing a common-sense approach to avoid unnecessary work.

Gove said progress was being made in ongoing discussions with industry leaders, who he said agreed that leaseholders should not pay cladding removal costs.

But he warned that he was ready to act and if firms did not act responsibly, they would face commercial and financial consequences.

The government will also be able to apply its new £4bn building safety levy to more developments, with scope for higher rates for those who do not participate in finding a workable solution.

Alongside further leaseholder legal protections, courts will also be given extra powers to stop developers using shadowy shell companies, which make them difficult to trace or identify who they are run by, so they can avoid taking responsibility for their actions.

If passed by Parliament, these amendments to the Building Safety Bill will be brought into law.

Gove said: “It is time to bring this scandal to an end, protect leaseholders and see the industry work together to deliver a solution.

“We cannot allow those who do not take building safety seriously to build homes in the future, and for those not willing to play their part they must face consequences.”

Cost Contribution Orders will be able to be placed on manufacturers who have been successfully prosecuted under construction products regulations.

These orders will require them to pay their fair share on buildings requiring remediation.

Amendments to the Building Safety Bill, revealed today, will also allow building owners and landlords to take legal action against manufacturers who used defective products on a home that has since been found unfit for habitation.

The power will stretch back 30 years and allow recovery where costs have already been paid out.

The provisions announced today will also go further than the package outlined last month by protecting leaseholders on non-cladding costs.

Under the plans, developers that still own a building over 11m that they built or refurbished – or landlords linked to an original developer – will be required to pay in full to fix historic building safety issues in their property.

Building owners who are not linked to the developer but can afford to pay in full will also be required to put up the money to do so.

In the small number of cases where building owners do not have the resources to pay, leaseholders will be protected by a cap. The cap will be set at similar levels to ‘Florrie’s Law’ which applies to some repairs to social housing: £10,000 for homes outside London and £15,000 for homes in the capital. This will limit how much leaseholders in this scenario can be asked to pay for non-cladding costs, including waking watch charges.

Any costs paid out by leaseholders over the past 5 years will count towards the cap, meaning some leaseholders will pay nothing more.

The proposed government amendments will be debated in the House of Lords during the Committee Stage of the Building Safety Bill which begins on Monday 21 February.