Gove issues six weeks ultimatum to sign building safety contract

Aaron Morby 2 months ago
Share

Housing secretary Michael Gove has set a six-week deadline for developers to sign a government contract issued today committing them to fix their unsafe towers.

Gove says action comes after too many developers, along with product manufacturers and freeholders, have profited from these unsafe buildings
Gove says action comes after too many developers, along with product manufacturers and freeholders, have profited from these unsafe buildings

He also warned that any house builders and developers failing to sign the contract would be banned from the market.

Volume house builder Persimmon is the first to sign, with Barratt expected to follow suit shortly.

The remediation contract requires developers to fix buildings and reimburse taxpayers, with an estimated £2bn expected to be committed to fund repairs.

Legislation will be brought forward in the spring introducing fresh powers to prevent developers from operating freely in the housing market if they fail to sign and comply with the remediation contract.

The contract, which has been drawn up by the Department for Levelling Up, Housing and Communities, will protect thousands of leaseholders living in hundreds of buildings across England.

Click here to see new Remediation Contract

Under the contract, developers will commit an estimated £2bn or more for repairs to buildings developed or refurbished over the past 30 years.

This means that together with the Building Safety Levy, industry is directly paying an estimated £5bn to make buildings safe.

The contract also requires developers to reimburse taxpayers where public money has been used to fix unsafe buildings.

Around 49 of the country’s leading developers have pledged to fix their own buildings, which will now be turned into legally binding commitments.

Gove said: “Today marks another significant step towards righting the wrongs of the past and protecting innocent leaseholders, who are trapped in their homes and facing unfair and crippling costs.

“Too many developers, along with product manufacturers and freeholders, have profited from these unsafe buildings and have a moral duty to do the right thing and pay for their repair.

“In signing this contract, developers will be taking a big step towards restoring confidence in the sector and providing much-needed certainty to all concerned.”

He added: “There will be nowhere to hide for those who fail to step up to their responsibilities – I will not hesitate to act and they will face significant consequences.”

Dean Finch, group chief executive at Persimmon, said: “The publication of the developer remediation contract is the culmination of many months of hard work on all sides and we are pleased to confirm our intention to sign the final document in the near future, becoming the first developer to do so.

“The terms of the contract are entirely consistent with our existing commitment to protect leaseholders in multi-storey buildings we constructed from the costs of remediating cladding and life-critical fire-related safety issues.”

A Barratt spokesman added: “We will be carefully considering the detail of the Developer Remediation Contract with a view to signing it over the coming weeks.”

Details of forthcoming changes to support leaseholders


Under legislation to be brought forward this spring, a Responsible Actors Scheme (RAS) will be created, allowing the housing secretary to block developers who have not signed the contract or failed to comply with its terms from carrying out development and from receiving building control approval.

This will prevent them from operating as normal in the housing market for as long as they do not resolve the problems of the past.

Gove has also pledged take action to ban managing agents and freeholders from taking commissions when they take out building insurance.

This comes in response to a report from the Financial Conduct Authority that suggested commissions make up almost a third of premiums.

Government will also bring in further measures to make service charges more transparent and empower leaseholders who want to challenge their bills.

This follows confirmation from six major lenders that, from earlier this month, they will once again consider mortgage applications on properties that are covered by the leaseholder protections in the Building Safety Act, or where the building is eligible for a government or developer remediation scheme.

Once developers sign the contract, leaseholders will benefit from a common framework of rights and responsibilities that will get their buildings fixed without them having to pay, and will require developers to inform residents in affected buildings how they will be meeting these commitments.

Latest news

Gove goes after Grenfell cladding supplier Arconic

Housing secretary fires off another letter to a Grenfell supplier saying pay up for cladding crisis
5 hours ago

Squibb confirms appeal against bid rigging fine

Demolition specialist joins Keltbray in appealing against CMA penalty
18 hours ago

Bigger projects help Wates hit record turnover

Size of average construction contract taken on hits £43m
20 hours ago

12 firms in fight to renew £1bn North West Construction Hub deal

Race starts for medium value building framework covering projects between £3m-£8m
20 hours ago

Former Inland Homes chief to invest £2.5m in cash raise

Cash-strapped developer hopes to raise £4.6m in share sale closing today
1 day ago

Ten firms sign £3bn L&Q homes upgrade deal

15-year deal will include fire safety, energy retrofits, bathroom and kitchen upgrades
21 hours ago

Groundworks firm Conlon saves piling specialist

Work restarts on Abbey Pynford sites after acquisition
2 days ago

BAM Farrans JV installs Great Yarmouth bridge leaves: Video

Watch civil engineering feat in action as 770 tonne bridge leaves lowered into place
2 days ago

Gove invites Kingspan for talks on fire safety compensation

Insulation firm urged to pay for its part in cladding crisis after unveiling record profits
2 days ago

Galliford Try and Midgard bag 350 homes deal at Brent Cross

Galliford Try will build 249 BtR flats and Midgard 107 flats for sale
2 days ago

Sizewell C project gains key environmental permits

Waste permits allow client NNB Generation Company to move to site investigation and construction environmental approvals
2 days ago

Cost of Robertson school contract soars to £100m

Construction to start next month after cost jumps from original £60m
2 days ago

House building cost inflation eases as build out rates fall

Housing cost inflation expected to grow by 1.4% this quarter
2 days ago

Modular builder ilke Homes hires Deliveroo chief to drive profit push

David Scott charged with making business profitable
2 days ago

£500m Leeds South Bank scheme gets green light

Leeds City Council approves plan for 1,350 flats in mixed-use South Bank development
3 days ago

Galliford Try takes rebid £150m Carlisle Southern Link Road

Main construction works are due to start on 8km road in June
4 days ago

Arup takes stake in graphene-enhanced concrete venture

New concrete additive Concretene™ promises 30% savings in CO2 emissions
3 days ago

Winners revealed on £1.42bn materials framework

Thirteen builders merchants land places on huge procurement deal for social landlords
3 days ago

Travelodge eyes plans for another 300 hotels

Hotel giant writes to local councils offering partnership deals with a £3bn investment target
3 days ago

Balfour Beatty to invest £60m in pop-up EV chargers

New Urban Fox JV will roll out 35,000 charge points across the UK over the next decade.
4 days ago

Leading Channel Isles builder goes bust

Jersey-based construction firm Camerons placed in liquidation
3 days ago

HS2 Euston needs full design reset as costs set to double

Spending watchdog warns Euston stop-start delay will simply inflate already ballooning costs
4 days ago

Worker dies on major warehouse site in Stafford

Main contractor Glencar halts work while tragedy is investigated
4 days ago

Sellar switches London flats/hotel plan for 444 student rooms

Developer buys Southwark's King’s Place site for major student room block rising to 11 storeys
4 days ago

Bid race starts for Norfolk £30m Long Stratton Bypass

Council hopes to start work on 3.9km bypass in April 2024
4 days ago

GMI to build first warehouse at £200m Teesside business park

Work to start early next month on first shed at airport business park
4 days ago

Skanska Costain Strabag JV sets up own rebar plant

HS2 team now running on-site manufacturing facility to avoid supply chain issues
4 days ago

Bid rigging: Keltbray to appeal and so could Squibb

Both contractors "disappointed" with level of fines
7 days ago

Ten demolition firms fined £60m for bid rigging

Full details of fines with Erith and Keltbray hardest hit
1 week ago

Retail contractor J M Scully files administration notice

£23m turnover Dorset based contractor lodges court notice
7 days ago

Contractor services