The Building Safety Act introduced leaseholder protections to ensure leaseholders are safe in their buildings. A threshold which set a balance between those purchasing properties primarily to live in and those who have made commercial or investment decisions, whether freeholders or leaseholders, was therefore needed.

There are protections in place for leaseholders who do not qualify. Building owners and landlords who built defective buildings of at least 11m or at least five storeys, or are associated with those responsible, must pay to remedy historical safety defects for both cladding and non-cladding defects. The principal residence of all leaseholders in relevant buildings will qualify for the protections. In addition, remediation contribution orders and the Defective Premises Act provide routes for leaseholders in relevant buildings to recover remediation costs from those responsible, whatever their qualifying status.

The Building Safety Act introduced leaseholder protections to ensure leaseholders are safe in their buildings. A threshold which set a balance between those purchasing properties primarily to live in and those who have made commercial or investment decisions, whether freeholders or leaseholders, was therefore needed.

There are protections in place for leaseholders who do not qualify. Building owners and landlords who built defective buildings of at least 11m or at least five storeys, or are associated with those responsible, must pay to remedy historical safety defects for both cladding and non-cladding defects. The principal residence of all leaseholders in relevant buildings will qualify for the protections. In addition, remediation contribution orders and the Defective Premises Act provide routes for leaseholders in relevant buildings to recover remediation costs from those responsible, whatever their qualifying status.

The Department engaged with leaseholder groups and lenders on the leaseholder deed of certificate. This helped to ensure that the leaseholder deed of certificate is fit for purpose; the information requirements were designed to present a minimal burden to leaseholders, whilst being sufficiently robust to demonstrate their qualifying status and to also prevent fraud.

We have worked closely with leaseholder groups to produce guidance on the leaseholder deed of certificates and the overall leaseholder protections. This guidance can be found here.

The leaseholder deed of certificate is an essential tool in the protection of leaseholders from unaffordable bills for historical building safety defects. This deed of certificate enables leaseholders to self-determine whether or not they benefit from the protections with regard to remediation costs for unsafe cladding and non-cladding building safety defects, as well as costs for interim safety measures for their leasehold property. The leaseholder deed of certificate is an essential part of the protections as it allows leaseholders to demonstrate their ‘qualifying leaseholder’ status.

The Government currently has no plans to introduce new council tax exemptions. Council tax contributes to a range of vital public services, including those which are at the forefront of the Covid-19 response. We are providing over £5 billion to speed up the removal of unsafe cladding, making homes safer, more quickly.

MHCLG has regular engagement with leaseholder groups and recognises the effect on residents living in high-rise buildings with unsafe cladding. That is why the Government is investing over £5 billion to remediate high rise residential buildings with unsafe cladding.

Mental health is one of the Government’s top priorities and we are working across Government to ensure that all people, regardless of their residential situation, get the help and support they need. Where residents of buildings fitted with flammable cladding need mental health support, they should make contact with their GP to discuss these issues so they may be referred to mental health services as appropriate. In addition, we are working with the NHS, Public Health England and MIND, develop resources signposting all residents to key services to help those concerned about their mental health and financial situation.

The Government is conscious of the need to make any financing scheme affordable for leaseholders, which is why we have said that the financing scheme will have a £50 a month cap. Further details of the financing scheme will be made available as soon as we are able.

The Government is investing over £5 billion in building safety, which will help protect leaseholders from cladding remediation costs in high-rise residential buildings. On 10 February 2021, the Government announced a 5-point plan for investment in building safety, with £3.5 billion earmarked for the removal of unsafe cladding on high-rise residential buildings, as well as a new finance scheme for cladding removal on buildings between 11 and 18 metres where no leaseholder will ever pay more than £50 a month. In addition, the Government has proposed a new ‘Gateway 2’ industry levy and residential property developer tax to ensure developers contribute to costs. These measures will provide certainty to residents and lenders, boosting the housing market and helping to ensure that developers, investors and building owners who have the means make a fair contribution to costs of remediation, without passing on costs to leaseholders.

No consideration has been made for a self-assessment exemption for leaseholders of high rise buildings with unsafe cladding.

The Government recognises residents’ concerns about the cost of waking watch measures. That is why we collected and published information on waking watch costs, available at: www.gov.uk/government/publications/building-safety-programme-waking-watch-costs. The data also illustrates that alarm systems can provide a more cost-effective means of protecting resident safety. We are therefore providing £30 million in funding to pay for the costs of installing an alarm system in buildings with unsafe cladding. The Waking Watch Relief Fund opened on 31 January 2021 to all eligible Social sector buildings in England, and all private sector buildings except those in Greater London. All applications have now been submitted and are being processed. In Greater London, the fund opened on 18 March for 6 weeks and is being administered by the GLA. Common alarm systems will enable costly waking watch measures to be replaced in buildings waiting to have unsafe cladding removed.

We are aware that some leaseholders have received significant increases in their insurance premiums where their block has building safety concerns. We are working with the insurance industry to understand this issue and are engaging with a range of proposals put forward to address it. We are encouraging insurers to take a proportionate approach to risk.

We are aware that some leaseholders have received significant increases in their insurance premiums where their block has building safety concerns. We are working with the insurance industry to understand this issue and are engaging with a range of proposals put forward to address it. We are encouraging insurers to take a proportionate approach to risk.

With an unprecedented over £5 billion investment in building safety, including £3.5 billion announced in February 2021, leaseholders will now need to pay either nothing, or up to £50 per month towards fixing the problem. This helps gives lenders certainty both that the cladding will be remediated, and of the total potential financial implications for a leaseholder and their property.

This announcement is therefore an important step towards restoring confidence in the housing market. It provides certainty for lenders where unsafe cladding is present and complements the wider work we have underway to continue to develop a proportionate risk-based regulatory environment on fire safety.

Matters of liability and any related action are specific to individual buildings, and the Department cannot comment or provide any specific guidance on these. However, the Government provided additional funding to the Leasehold Advisory Service (LEASE) to provide independent, free, initial advice to leaseholders on building safety issues to ensure they are aware of their rights and are supported to understand the terms of their leases.

The purpose of the Building Safety Fund is to increase the pace of remediation of unsafe non-Aluminium Composite Material cladding in residential buildings 18 metres and above. Any costs for leaseholders will depend on the extent of other remediation work to be carried out which is beyond the scope of the Fund. For remediation costs in general, the draft Building Safety Bill includes an impact assessment which is available at www.gov.uk/government/publications/draft-building-safety-bill . Further analytical work will be undertaken to update the impact assessment, including the cost estimates for leaseholders, which will be published when the Bill is formally introduced to Parliament.

The Government is aware of the impact on leaseholders and residents living in high rise residential buildings with unsafe cladding and has introduced the £1 billion Building Safety Fund to help make homes safer, more quickly and for the long term. The Building Safety Fund is to cover costs of the remediation of unsafe non-Aluminium Composite Material cladding but not for any service charge fees that might be incurred in the interim. In addition, Government Advisor Michael Wade is accelerating work to identify financing options for future remediation work that will protect leaseholders from unaffordable costs, while ensuring these do not fall to the taxpayer. However, it must be recognised that it is the responsibility of building owners – not Government or the tax payer – to ensure their buildings are safe for leaseholders and other residents.

Leaseholders can challenge the action of a property management company in a number of ways, including:

• by making a formal complaint through their managing agent’s complaints procedure;
• by making a complaint to one of the Government-recognised redress schemes; and
• by exercising their ‘right to manage’.

In addition, where there is evidence of significant failings by the managing agent, leaseholders can ask the First-Tier Tribunal to appoint a new property manager.

We recognise there is more that can be done to help leaseholders challenge poor management practice. That is why on 1 April we announced plans to give leaseholders greater ability to do so. We will be improving the presentation of service charges so they can be better understood and more easily challenged. We want to empower leaseholders to switch managing agents where they perform poorly or break the terms of their contract.