The government has declared that it will fully subsidise the replacement of the cladding made of ACM (Aluminium Composite Material) and will shield private sector renters in residential high-rise buildings (above 18 M) from the expenditure of remediation. Where a warranty claim is approved, this does not apply.
For the removal and replacement of dangerous ACM cladding on residential social housing buildings taller than 18 metres, the government has previously established a social sector cladding fund.
Currently, housing associations can access two primary government cladding remediation fund help for the removal and replacement of dangerous cladding systems.
On January 10, 2022, the Secretary of State for Levelling Up, Housing, and Communities announced the creation of a third fund that will use £4 billion in developer contributions to pay for remediation in structures between 11 and 18 metres in height.
Housing associations have made major improvements to structures that require rehabilitation and mitigation as a result of the catastrophe at Grenfell Tower. Spending less on remediation, however, leaves less money available for constructing desperately needed new, affordable houses or enhancing existing ones.
ACM cladding for Social sector remediation fund
On May 16, 2018, the government declared that it would provide £400 million in full funding for the replacement and removal of hazardous ACM cladding on residential social buildings that are 18 metres or taller. This comes from a total financing pool of £600 million that is made available to both the private as well as social sectors.
98% of the social housing buildings that qualify for the grant have either begun or finished rehabilitation. To align it with the Building Safety Fund, the government did lower the height requirement for eligible buildings to 17.7m, but it did not close the fund.
Image Credit: https://www.istockphoto.com/photo/architects-talking-about-a-new-project-in-the-office-gm1352437949-427857854?phrase=Building%20safety%20fund
Building safety fund
The government unveiled a new £1 billion fund in 2020 for the removal and replacement of dangerous non-ACM cladding systems on structures 17.7 metres and taller. Following the NHF’s interaction with the government, the prospectus for the Fund was released in May 2020, reiterating that costs will be reimbursed for leaseholders in both the social and private sectors.
In the event that these deadlines cannot be reached, DLUHC has announced it will evaluate claims on a case-by-case basis and that it will reopen the Fund later in 2021 for qualified buildings that had not previously submitted claims before the deadline.
Additionally, the government has made information on how to apply for the Building Safety Fund available. It has stated it will reopen the Fund in the autumn after announcing an additional $3. 5 billion for the Fund in July. In order to speed up the funds distribution process and launch the next phase of the fund, Michael Gove declared his aim to do so in January 2022.
Despite moving as swiftly as they can to examine structures and find contractors for the work, the NHF has been emphasising housing associations’ challenges in achieving the timeframe for beginning the work on site.
DLUHC will continue to require organisations requesting funding from the Fund to establish realistic yet ambitious project delivery deadlines, and in cases where they believe progress is being made too slowly, they may take enforcement action.