On 22 January I wrote to Christopher Pincher, Minister for Housing, to raise concerns on behalf of my constituents about ongoing issues surrounding fire safety. I also raised concerns about the ever increasing extra costs associated with leasehold properties. You can see the letter in full below:
Thank you for your time yesterday. It was good to have an opportunity to raise constituent concerns with you, and, as suggested, I am writing to you to raise a few points for which a written response would be helpful.
The housing market in London has, frankly, been broken for years, with many people stretching their finances much farther than those in other areas in order to secure any form of housing security or ownership. This leaves many in a much more perilous position than elsewhere.
There is continuing severe anxiety about the prospect of remediation costs being passed on to leaseholders. I know, based on our conversation yesterday, that you understand the mental health impacts and disruption to lives that this crisis is causing, and that you appreciate the respects in which the circumstances of the pandemic have made these impacts still worse.
As I said yesterday, this is especially true in Newham. Here, we have high numbers of new-build tall buildings affected by fire safety risks, terribly high levels of deprivation, and some of the worst economic damage from the pandemic, with large numbers of people in creative, hospitality, and events sectors, many excluded from Government support, and the highest furlough numbers in the country.
I know you will understand that extending charges to cover remediation costs over time through loans may reduce the immediate negative impacts on leaseholders, but it is no less unfair. This crisis has arisen because of poor regulation, and poor implementation of those regulations, within the development industry. Leaseholders are not responsible.
I would be grateful to know if you are considering the model used in the Australian state of Victoria, where a levy on building permits is being used to cover public costs, and the state is able to pursue those culpable for defects directly in order to recover spending on the buildings these practitioners failed to make safe.
I understand that a levy on building permits could interfere with Government policies on housing construction, at least if considered in isolation. However, I would think that if the development industry will not play their part voluntarily, a tax on their profits over the last years should be considered to recoup monies that have had to be spent from the public purse to make up for dangerous practices within their industry.
In the East Village case that I described at length yesterday, Triathlon are explicitly warning that if the Fund does not cover the remediation costs, and they cannot recover these costs from the original contractors responsible for the building flaws, they will pass costs on to leaseholders. Many of the defects that have been found appear to have in violation of regulations in force at the time of construction, not only those that have been put in place since 2015. I continue to believe that the Government should prevent costs from being passed on to leaseholders, rather than facilitating it.
I am grateful for the news that the prospectus for the waking watch fund will be announced very soon, and applications opened as soon as possible after that. I hope that my constituents will be able to take full advantage, that costs will be prevented from being passed to leaseholders, and that the disadvantages of a waking watch in comparison to an appropriate alarm system will be removed quickly.
I would appreciate some further information on what the Government is doing to give comfort to constituents in the following situations:
- Needing to move for work or family reasons, but unable to afford to do so unless they can sub-let their property, where sale is impossible because of the crisis. Housing association or mortgage provider policies often prevent this, and discretion is not being used sympathetically in light of the circumstances constituents face.
- Needing to sell, for example because a mortgage has become unaffordable due to the pandemic. In some cases, I am told the ability to staircase to full ownership would make a sale easier. In other cases, sale back to the housing association is the only feasible option. In both of these cases, I am told housing association policies on these issues do not appropriately take the circumstances into account, and I believe the Government should look to intervene here.
- Having been moved by default onto an unaffordable variable rate mortgage, and unable to remortgage because of fire safety risks. I would be grateful to know what progress has been made with mortgage providers in relation to this.
Finally, I would like to raise some appalling, unaffordable increases in building insurance premia that have just been brought to my attention. Hallings Wharf in Stratford has been given a sixfold increase in its premium, which would equate to around £3000 a year per flat, on top of the service charges. This was, apparently, the one and only buildings insurance offer that a major broker could arrange. This is not the only example of a massively increased premium linked to the finding of fire safety risks. I believe this requires an urgent intervention from the Government. The many residents who cannot pay these charges could quickly be found in violation of their mortgages, or other terms, and could therefore be left bankrupt or homeless.
Thank you for your offer to discuss these and other issues with the Minister for Building Safety next week. I look forward to reading your response.
Lyn Brown MP