Registration opens for building safety fund to replace unsafe non-ACM cladding

The registration process to apply for funding to help meet the cost of removing and replacing unsafe non-ACM cladding systems on high-rise residential buildings opened on 1 June 2020 and will remain open until 31 July 2020. 

Plans for the Building Safety Fund were originally announced by the Chancellor, Rishi Sunak, in the March 2020 budget and the £1bn fund is in addition to the £600m the Government has already made available to cover the cost of remediating high-rise buildings installed with ACM cladding, deemed to pose the greatest risk. 

Eligibility 

Registration for the fund will be open to building owners, freeholders, landlords and management companies that would be legally responsible for the repair of a building and able recover the costs from leaseholders through the service charge. 

Once an application has been registered, the Government has stated that it will work with building owners to complete any technical assessments necessary to determine eligibility. However, the current guidance published by the Government also states that where building owners have the capacity and capability to undertake identification of potentially unsafe cladding the Government will expect such owners to continue to do so. 

The Government has stipulated that the fund will not be available for buildings below 18m in height or for buildings where there are no residential leaseholders, such as hotels or hospitals. 

11 March 2020 cut-off 

Unfortunately for many, the Government has stipulated that the fund will not be available for remediation works on buildings with non-ACM cladding systems where such work “had been committed to, or where work had started on site” prior to the Budget announcement on 11 March 2020. No clarification has been provided on the extent to which work may or may not have been “committed to” in terms of eligibility for the new funding, although at present it appears that building owners will not be entitled to apply for re-imbursement for the cost of any remediation works that have already been carried out. 

The announcement of the 11 March 2020 cut-off has been met with consternation by many building owners who have already proceeded with the necessary cladding remediation works and leaseholders who have been asked to cover the costs of such works. 

Registration 

Further details regarding the full claim process will be set out by the Government in July, though it has stated that following registration a full funding application will need to be submitted before December 2020, based on the tender price for carrying out the remedial works, and that construction will need to commence on site before 31 March 2021. 

The fund has a maximum £1bn available and applications will be managed on a ‘first come, first served’ basis. Further information regarding the registration process for the Building Safety Fund, including the questions applicants need to answer (found in Prospectus Annex B) is available on the Ministry of Housing, Communities & Local Government’s website at https://www.gov.uk/guidance/remediation-of-non-acm-buildings.   

This article was written by Ben Wilkins. For more information, please contact Ben on +44 (0)207 438 2216 or at ben.wilkins@crsblaw.com.