Source · Select Committees · Public Accounts Committee
Recommendation 38
38
Deferred
Taxpayer exposure to building remediation costs could exceed the stated £5.1 billion cap.
Conclusion
HM Treasury has agreed to provide short–term funding that would allow remediation to progress in advance of the Levy recouping funds in later years. Based on MHCLG’s financial planning, the NAO highlighted that total taxpayer exposure could reach a maximum of £6.3 billion in 2030-31 before all Levy receipts are collected.63 When we asked MHCLG what impact its acceleration plans might have on the spending cap, MHCLG assured us that taxpayer contributions towards remediation costs would remain capped at 60 C&AG’s Report, para 1.11; Ministry of Housing, Communities and Local Government, Cladding remediation unit costs: analysis of high-rise non-ACM buildings - GOV.UK, December 2024 61 RDC0006 Written evidence submitted by the Home Builders Federation; RDC0145 Written evidence submitted by End Our Cladding Scandal 62 Qq 88, 91, 93–96; C&AG’s Report, figure 10, para 3.11 63 C&AG’s Report, paras 16, 3.12 23 £5.1 billion. We therefore asked MHCLG whether accelerating remediation might increase taxpayer exposure, but officials did not provide an update on the figure. In a letter following the evidence session, MHCLG advised that its figures were estimates based on several factors including the total number of buildings requiring remediation, remediation costs, how fast buildings are fixed, and the quantum of levy receipts (which itself depends on new houses built). It assured us it continued to examine these and would be updating forecasts later in the year.64 Managing risk of fraud
Government Response Summary
The government committed to publishing latest building number estimates by summer 2025, but the publication of estimates for costs and works completion dates is deferred until after the forthcoming Spending Review.
Government Response
Deferred
HM Government
Deferred
5.1 The government agrees with the Committee’s recommendation. Target implementation date: Summer 2025 5.2 The government will publish latest building number estimates by the summer. The exact timing of publication of estimates of costs and works completion dates, however, will depend on the outcome of the forthcoming Spending Review. A firmer publication timeline can be provided once this is known. 5.3 The government welcomes the review by Paul Morrell OBE and Anneliese Day KC. Their review maps out the existing system, identifies weaknesses, and sets out recommendations for addressing these where they considered it appropriate. It makes clear this is a complex area in need of reform. The Construction Products Reform Green Paper, published on 26 February 2025, is the government’s direct response to the review and signals its commitment for comprehensive proposals for system wide reforms to the construction products regime to give consumers confidence and underpin supply chains and housing delivery.