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10 January 2022

Why Michael Gove’s cladding plan creates new headaches for the government

The principle that leaseholders shouldn’t be left out of pocket means the government may well have to pay for more than just new cladding.

By Stephen Bush

No leaseholder will have to pay the cost of removing illegal cladding under plans to be unveiled by Michael Gove later today (10 January). But it is not yet clear who exactly will have to pay: or, equally important, who will have to pay the costs already borne by leaseholders.

Gove’s preferred remedy is that developers should have to pay: one reason why the Treasury has held out against this, and one reason why the former housing secretary Robert Jenrick tried to pass the cost on to leaseholders, is Rishi Sunak’s scepticism that the developers will ever stump up the cash.

The most important part of today’s announcement, therefore, isn’t about who will pay for it – while Gove is surely right philosophically that the costs should be borne by developers not leaseholders, he may struggle to raise all the necessary funds from that source – but who won’t. Because it’s not just dangerous cladding that leaseholders have had to pay for in the wake of the Grenfell Tower disaster.

Leaseholders with flammable cladding have had to pay for, among other things, 24-hour fire safety watches while they wait to have their cladding removed. And it remains unclear who will have to pay not just for what is in tower blocks but what shouldn’t be (ie, dangerous cladding), and also who should pay for what isn’t in tower blocks but should be (ie, functioning firebreaks).

Whatever one thinks of the politics (or indeed the ethics) of the Jenrick approach of trying to palm off as much of the cost of the Grenfell clean-up to leaseholders, one thing that he and Sunak are surely right about is that having acceded to the principle that leaseholders shouldn’t be the ones left out of pocket, Gove and the government may well have to pay for more than just cladding.

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