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London Mayor wants windfall tax to fund cladding removal

London Labour Mayor Sadiq Khan wants a £3 billion one-off windfall tax on private developers to fund replacement cladding on affected buildings.

It is thought there may be many thousands of landlords whose flatted units are in blocks with ACM cladding.

Khan says the publicly listed house builders alone have enjoyed £30 billion in pre-tax profits from 2011 to 2020.

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The 10 per cent levy on this profit would therefore raise £3 billion, excluding the non-listed developers.

Khan says many landlords and owner occupiers - an estimated 450,000 in total - have seen their properties made almost unsellable due to the cost of replacement cladding.

“I have always been clear that the responsibility for funding building safety work must lie with government. However, we cannot deny the role that industry has played in making decisions that have compromised the safety of buildings” claims Khan.

Just before Christmas the government claimed a new £30m Waking Watch Relief Fund would pay for the installation of fire alarm systems in high-rise buildings with cladding, removing or reducing the need for costly interim safety measures.

Currently many landlords join owner occupiers in paying for private ‘waking watch’ services.

  • George Dawes

    Typical lefty , tax, tax and more tax , no conception of the real world

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    For once I agree with Khan. Builders have made huge profits over recent years and cut every corner possible.

    They have deeper pockets and more responsibility for fixing issues like unsafe cladding than unfortunate leaseholders and owner occupiers.

    Incidentally I haven't seen any outcry from Shelter over people being forced to continue to live in properties with unsafe building materials. Are owners less deserving than tenants?

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    Of course Shelter won’t kick off about it. There’s no cash in it for them. Dame Polly needs to get a return.

     
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    Why would a builder who builds with no problems fund those who used materials sold to them under false pretences be responsible for putting right the wrongdoings of a supplier? This is a supplier problem and NOT a builder problem. Down to the supplier to rectify OR building control to pay for their errors.
    Many years ago building control stopped approving foundations in many areas due to their departments being made liable for reinstatement of faulty foundations previously approved by them. They subsequently handed the responsibility over to engineers.
    Since someone else approved the faulty cladding it stands to reason whoever approved of the faulty materials or the manufacture of the faulty goods must pay. NOT the builder who built using the mis-sold materials and NOT some blameless builder who had no idea one of his competitors was using faulty goods.
    Further is is NOT for the subsequent owner of the property bought by them in good faith to fund the repair costs for these faulty and dangerous goods used in the construction. They had no control over the builders use of materials and to place the repair costs at the door of the homeowner is so unfair as to border on criminal.

  • Andrew McCausland

    Well said Retired Agent one. All the builders do is build to the specification agreed with the architects and building control inspectors. If they are told a product meets the required specification then they use it. If it does not meet the set standards then they use something else.

    There are 2 issues that have come our of Grenfell: incorrect specification of materials that do not meet the required fire safety standards and therefore should not have been used, and incorrect installation of the materials in such a way as they did not meet the agrement certification for that measure.

    The first problem is not with the builders but with the system that certifies products and their fire safety. This is being tighten up now, but it is a government led process that has failed and there are grounds to say that the government should at least part fund replacement ACM. If the manufacturer has lied about the cladding's fire safety rating, as seems to have been the case in Grenfell, then the manufacturers have a substantial liability.

    The other issue is with poorly fitted cladding that was not installed correctly. In this instance, IMO, both the builders and the people who signed the completion certificate (architects?) are liable and should pay for replacement immediately and compensate owners for the costs to date.

    Personal opinion: If I owned shares in Kingspan Group I would be looking to sell asp.

  • Matthew Payne

    I can only find quotes on Khan referring to the "industry" not developers, so I don't know whether he means the builders or this is press assumptions once more. Either way, developers are the tip of the iceberg, albeit have had their part to play.

    It has to be paid for by a combination of HMG, the architects, the manufaturer, the developer, and building control. All have made, and have potentially made errors that has got us to this point. Time is of the essence though for many 1000s of leaseholders though who are living through this nightmare whether not being able to move, finance, insure or sleep.

    A forensic investigation into blame on each block could take years, as all parties point the finger and look to avoid blame and slow down any outcome. The only alternative is to have government legislate on some prescriptive formula, including its own share, that is applied that apportions responsibility and cost to remedy the issues.

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    Companies that made the panels are solely responsible. Developers did not select a panel because of its ability to catch fire quickly. This is typical of the Mayors way of sorting problems make someone with a bigger wallet pay. Call it socialism call it marxism call it labour same thing

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    You may or may not be right. But no need to politicise this. Keep to the issue in the article please. (That applies to the article too , Landlord Today, please note.)

     
  • English Landlord

    Brian Rose for London Mayor? About time some common sense was brought back to the people of London.

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    • 31 December 2020 11:50 AM

    So why do the local authorities always get away with this and no punishment whatsoever????????

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    Exactly David, the freehold owners of Grenfell are the council, the landlord was the council and the building control officer who inspected and signed off the works as safe was the same council's employee, yet no arrests, no prosecution and no jail, just think of the poor private owner / landlord in a similar situation, stinks, one law for them, another for us.

     
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