Esther McVey told to bail out all flat owners caught in post-Grenfell fire safety crisis
MPs have demanded that the government finally foot a multi-billion-pound bill to bail out hundreds of thousands of apartment owners caught in the post-Grenfell fire safety crisis.
Hilary Benn, MP for Leeds Central, on Wednesday led cross-party calls for the chancellor, Sajid Javid, to urgently increase the £600m fund to remove dangerous cladding from at least 400 buildings and make more money available to rescue other leaseholders.
At a debate in parliament, the housing minister, Esther McVey, was urged to face up to a “potentially colossal drain on the public purse” and help flat owners in buildings with different fire safety problems from the combustible aluminium composite (ACM) panels which spread the fire at Grenfell Tower. Benn said the government must release funds to fix “all buildings with unsafe cladding of whatever type”, and end its policy of only offering to fix those with ACM panels.
Labour has estimated that 600,000 leaseholders could be trapped in flats that are dangerous and worthless because they are covered in combustible cladding that is not ACM or have other fire safety problems, which neither the government, developers or freeholders are offering to fix in most cases.
Benn said the government’s policy was “manifestly unjust”. “If our constituents had bought cars or washing machines that were a fire risk, no one would have dreamed of saying to them, ‘Sorry, you’re going to have to pay for the cost of replacement,’” he said.
Leaseholders have long accused ministers of ignoring their problems and leaving thousands of people facing financial ruin, anxiety and depression. The housing secretary, Robert Jenrick, said last month that he was “considering options with the Treasury on the support that can go to leaseholders”, but no announcement has yet been made. Very little money has been released from the existing £200m fund for leaseholders with ACM. The fund was launched in May 2019, but only one building has so far been approved for a full-cost remediation, official figures show. Latest government figures show that 174 private-sector residential buildings with ACM are yet to be remediated.
Jenrick has pledged to name and shame landlords who do not fix unsafe ACM cladding but he has not yet done so.
McVey was repeatedly told how government policy was failing “mortgage prisoners” whose homes have become unsellable because of fire safety problems that go beyond Grenfell-style ACM cladding.
Shabana Mahmood, MP for Birmingham Ladywood, said one constituent was facing a £100,000 bill. “I can’t sleep, function or work,” he told her in a letter. “I try to be normal with my son but I can’t. I have a constant gut-wrenching dread coursing through my bloodstream. Each and every second I want to cry.”
Matthew Pennycook MP said leaseholders in “scores of developments” in his Greenwich and Woolwich constituency cannot sell their homes. He said at least 24 buildings were wrapped in a type of combustible cladding not covered by government funding. Meg Hillier, MP for Hackney South and Shoreditch, said one leaseholder constituent who could not remortgage their home because of its cladding was paying £800 a month more than necessary. David Lammy, MP for Tottenham, said that in his constituency more than 400 people affected by the cladding crisis could not get a mortgage or remortgage.
The pressure on ministers to act, almost 1,000 days after Grenfell, comes before next month’s budget, when leaseholders hope more money will be released.
Lawyers and accountants living in affected high-rises have told the Guardian that they could face losing their professional careers if help does not come soon. Barristers and solicitors are not allowed to practise if they are declared bankrupt and accountants automatically lose their membership of the Institute of Chartered Accountants.
“If I default on the mortgage and they repossess the property, they could make me bankrupt,” said Rebecca Fairclough, 36, a commercial disputes solicitor, who owns a flat in central Manchester built with combustible polystyrene insulation. “My career, that I worked really hard on, spent a fortune on, would be over. A lot of the apartments with cladding problems have whole communities of lawyers.”
At least 30 blocks in Manchester are believed to have been built in breach of safety rules, but only some are covered by the government’s ACM funds – £200m for private blocks and £400m for social housing.
UK Cladding Action Group, a leaseholders campaign body, said it was hearing about one new building affected by fire safety problems every day. It held a meeting of residents from 70 affected buildings last week in London to plan campaigning action. Residents in Manchester have been given access to mental health advisers amid growing signs of stress.
• This article was amended on 13 February 2020 because an earlier version incorrectly referred to “the existing £800m fund to remove dangerous cladding” and to the government’s ACM funds which include “£600m for social housing”. The correct figures are £600m and £400m respectively.