Source · Select Committees · Housing, Communities and Local Government Committee
Recommendation 10
10
The Committee welcomes the introduction of a new developer levy and tax to ensure that...
Recommendation
The Committee welcomes the introduction of a new developer levy and tax to ensure that developers contribute towards the costs of remediation. We recognise and welcome the fact that some developers have already committed millions towards remediation funds. We also recognise the need to encourage the building of new homes, and that not all members of the construction industry are responsible for fire safety defects. Notwithstanding, we consider that developers can and should be expected to make a greater contribution to the costs of remediation. The developer levy and tax should be extended and should serve as an additional contribution to the Comprehensive Building Safety Fund, in line with principles to be set out by the Government, as we have recommended, about how the full funds for remediation should be split between industry and Government. The Government should also consult with all relevant stakeholders to design the gateway 2 developer levy in such a way so that costs are not passed onto house buyers, including housing associations. (Paragraph 32) 24 Cladding Remediation—Follow-up
Government Response
Acknowledged
HM Government
Acknowledged
The Government agrees with the Committee’s recommendation that those responsible for building safety defects should be made to contribute to the costs of remediation. Alongside its negotiations with developers the Government has been engaged in discussions with various product manufacturers to ensure that industry contributes to the costs of remediation. As construction products manufacturers have not made a reasonable commitment, we will do whatever it takes to make sure that construction product manufacturers are held to account through the powers established in the Building Safety Act. The department’s new Recovery Unit will pursue firms that have failed to do the right thing, including through the courts. We have created a power in the Act to make regulations that would allow the Secretary of State to compel construction products manufacturers, their authorised representatives, importers and distributors (‘economic operators’) to contribute towards the cost of remediation works where construction products they have supplied have caused or contributed to dwellings being unfit for habitation. These regulations would enable the Secretary of State to serve a costs contribution order on an economic operator following successful prosecution for non-compliance with construction product regulations. The order will specify the amount that they will be required to pay towards the cost of remediation works. The order may also require them to contribute to the cost of building assessments carried out as part of this process. Alongside this measure, we have also created a power to make regulations to enable the Secretary State to take an alternative route via the courts. The Secretary of State will be able to apply to a court for a costs contribution order to be made against an economic operator. The grounds on which the court may make such an order would be the same as those for a costs contribution order made by the Secretary of State. Through ensuring that industry is held accountable for its mistakes, this will encourage compliance with strengthened regulatory requirements for construction products. The Government will continue to fund cladding remediation through the Building Safety Fund for buildings above 18 metres, as well as providing funding for 11-18 metre cladding removal through the building safety levy. We note the Committee’s recommendation that the government should consult on the impacts of the building safety levy on housing provision. The government launched a consultation, which closed on 15 October 2021 to seek views on the design of the levy and gain evidence of possible impacts on housing supply and regeneration and the housebuilding industry. We are considering the feedback we have received, as well as the impact of the changes to the levy and will update in due course.