Ministers outline £450m routemap to tackle cladding crisis

The proposal, which paves the way for public funding for remediation, is a key recommendation in a report published last week by the Ministerial Working Group on Mortgage Lending and Cladding. 

All recommendations have been accepted by the Scottish Government, which has committed to invest all the funding received in consequentials from the UK Government so far to address cladding problems. Future consequentials which are yet to be clarified will also be used to support the work.

Subject to the outcome of the election, a Single Building Assessment programme will be launched to carry out the safety assessments. It is expected that the majority of inspections will show that the building is safe, giving peace of mind to homeowners. Where problems are identified, this will help to identify the scale of funding needed to take necessary remedial work.

A Single Building Assessment is undertaken on a whole building rather than by an individual flat owner. This will release affected buyers and sellers from difficulties in accessing mortgages without them having to pay for the current External Wall System (EWS1) Report on their individual property.

The problem of cladding arose in the wake of the tragic Grenfell Tower fire which took place in London in June 2017. The tower had been refurbished with a specific type of cladding called Aluminium Composite Panel (ACP). While a faulty fridge from within one of the apartments started the fire, the cladding’s air gaps had allowed the flames to quickly spread to the other floors causing the deaths of around 80 people.

Housing minister Kevin Stewart had earlier admitted that a plan to resolve the issue in Scotland had taken longer to resolve than he had would have liked, but now believes the measures will enable the government to have a clear picture of the scale of the issue. 

Mr Stewart said: “This is an important milestone for people who are living in buildings with cladding. I have heard personally from homeowners who have had to change their life plans or are living with real concern about safety – no one wants that uncertainty and anxiety to continue.

“As part of this proposal, agreed unanimously by representatives of homeowners, surveyors, property managers, lenders and developers in our Ministerial Working Group, we will start assessments in June with remediation funding confirmed as soon as possible afterwards, possibly as early as August. By funding the Single Building Assessments we will have a clear picture of the scale of the issue. This will enable us to provide support for the remediation work required – I do not want people left facing unfair remediation costs. This approach will also save homeowners hundreds of pounds that they may otherwise have faced through paying for an EWS1.

“We are committing every penny of the £97.1m consequentials we have received so far towards this ambitious programme of work. We cannot guarantee that there will be enough public funds to support all the work that is needed, and other parties such as developers must continue to play their part where construction is not as it should have been. We have not yet been given clarity about how much or when we will receive the further funding promised from the UK Government and we continue to urgently press for this. When we do receive this, we will commit to ensuring it goes towards this major programme of work.”

Chris Ashurst, High Rise Scotland Action Group founder, said: “Owners and residents have been living in a state of uncertainty and fear over the safety and saleability of their homes. I believe these recommendations can bring a ‘Door of Hope’ to all affected, while recognising that there can be no silver bullet to tackle this issue.

“I believe there are many reasons to welcome these recommendations. It is important that costs for assessments are borne by the Scottish Government and not homeowners. I also welcome the fact that assessments will be undertaken by suitably qualified professionals working to a common standard, and will encourage collaboration between individual owners and residents, and factors. This pilot scheme for expression of interest starts within a fortnight.”

All buildings within the scope of expert guidance on buildings with cladding will be included in the programme – this is around 700 high rise properties and many more at lower heights.

These proposals build on guidance published by the Royal Institution of Chartered Surveyors which, effective from April 2021, clarifies types of properties which will, and those which will not, require additional inspections as a result of concerns about fire safety.

The Law Society of Scotland, which had earlier called for the funds to be used for a comprehensive assessment to establish the nature and extent of the cladding problem, said it was pleased that all of the working group’s recommendations have been accepted.

John Sinclair, convener of the Law Society of Scotland property law committee, said: “A single source delivery is the right approach to take to ensure that a whole building is inspected and consistent standards will apply across the country. It will provide a clear picture of just how widespread the issue is and the scale of work needed to rectify the cladding on affected buildings.

“The current situation has left homeowners very concerned about the safety of their buildings and a number have been unable to sell their properties. The assessment programme should begin as soon as is practicable to identify those buildings which require work, to help target the best use of the available  funding and to help bring residents peace of mind about the safety of their homes.

“The Law Society has been part of the working group discussions and I’m grateful to my colleague on the Property Law Committee, Brian Smith, for his input on behalf of the legal profession. I hope that the Minister will continue with the working group to develop these proposals and to ensure swift progress with these cladding issues.”

The Property Managers’ Association Scotland said the announcement will help bring an end to the crisis which has caused such turmoil and anxiety for so many flat owners throughout Scotland.

President Nic Mayall added: “We believe this announcement gives our members the opportunity to assist homeowners impacted by this situation with a potential solution, while further work is carried out on a resolution to long-term legislative issues. This will go a long way to alleviating the safety concerns of property owners and bring clarity for lenders so they can move matters forward with affected homeowners.

“Going forward, PMAS will continue to recommend through the Ministerial Working Group on Mortgage Lending and Cladding that any future money which the Scottish Government receives through consequentials from funds set aside by the UK Government are applied specifically for external wall systems, to enable this nightmare to be resolved once and for all.”

According to research published by The Herald on Sunday, at least 85 high-rise blocks and over 130 other buildings, mainly schools overseen by Scotland’s 32 local authorities, contain high-pressure laminate (HPL) panels which safety experts have raised serious concerns over.

An official analysis of local authority high-rises carried out last year and seen by the newspaper show that a further 23 of Scotland’s 774 high-rise buildings reported polyethene-type ACM panels (ACM-PE), another combustible material, similar to that found at Grenfell Tower. A further 15 buildings reported “limited combustibility”.

Sprinklers or other forms of automatic fire suppression equipment were reported in only just over one in three (39%) of high-rises. There are a reported 46,530 flats in high-rise buildings overseen by local authorities across Scotland – nearly half were built in the 1960s.

Thousands more flat owners in Scotland are also estimated to have had their privately-owned homes rendered worthless because they are wrapped in flammable materials.

One study shows that residents of flats with cladding and other unsafe building materials are paying an average of over five times more for building insurance that they were a year ago, adding thousands to annual service charges.

Last month, housebuilder Persimmon made a provision of £75m to address cladding safety issues on 26 buildings in its legacy development portfolio, while Barratt has already incurred an additional £56.3m of costs in relation to legacy properties and Taylor Wimpey has set aside £125m to fund cladding and fire safety retrofits to buildings.

The Scottish Government said it will seek expressions of interest from property owners and managers starting at the end of this month for eight weeks, to identify those buildings which have already had a cladding or fire risk assessment that highlights a risk to life as a result of a cladding system, materials used and/or poor construction. These will be considered as part of the pilot phase of the Single Building Assessment Programme in June 2021. The first decisions on remediation within the funding available will be taken over the summer, prioritising the buildings deemed most likely to be at risk.

A Q&A on the Single Building Assessment programme has also been published.