UK threatens developers over failure to sign building safety contract

UK housing secretary Michael Gove said he would take the first steps towards barring 11 developers from building and selling homes after they failed to sign up to a new legally binding building safety contract by the deadline this week.

Gove told the House of Commons on Tuesday that developers that had refused to sign up would be “out of” the housebuilding business in England until they changed their course. He also said he would be writing to local authorities advising them to withhold planning permission for new developments for the companies concerned.

The announcement follows years of efforts to force developers to fund work to replace dangerous cladding on high-rise buildings. Problems with some products emerged after the 2017 Grenfell Tower fire, which killed 72 people when fire spread through the external cladding of a west London tower block.

Leaseholders of properties in affected buildings have been unable to sell in many cases or faced huge bills to make buildings safe.

The minister said that 39 developers had agreed to join the programme, developed by his Department for Levelling Up Housing and Communities. The scheme commits them to putting right all life-critical fire safety improvements needed on buildings more than 11m tall that they developed or refurbished in England in the past 30 years.

However, he criticised 11 developers who had not yet signed — Abbey Developments; Avant; Ballymore; Dandara; Emerson Group’s Jones Homes brand; Galliard Homes; Inland Homes; Lendlease; London Square; Rydon Homes and Telford Homes.

“While my officials remain in discussion with several who are making progress towards signing, I’m concerned that some companies are not aware of the grave nature of the responsibility that they bear,” Gove told the Commons. “If you do not sign, you will not be able to operate freely in the housing market.”

Some housebuilders believe that the government, which allowed regulation and enforcement of fire-safety rules to become lax, and the manufacturers of some deficient products, should bear some responsibility.

Steve Turner, executive director of the Home Builders’ Federation, an industry group, said housebuilders had demonstrated their commitment to helping leaseholders by signing up to Gove’s contract. They were also funding work to fix some buildings built by overseas developers and other parties.

“Whilst UK housebuilders get on with remediation work, we hope government will now deliver on its promise to get contributions from other parties, including construction product companies and overseas-based developers,” Turner said.

Most of those on Gove’s list of holdouts are expected to sign the contract.

Telford Homes said it had had “constructive discussions” with the government and it was “completing the process” of evaluating the agreement’s terms and conditions.

Lendlease said it was working through the detail of the contract.

“We . . . expect our governance processes will allow us to confirm our position by early April,” it said.

London Square said it was “disappointed” to have been included on Gove’s list, since it said it had not received a contract relevant to its record.

“Our lawyers are working to reach an agreement with the government lawyers and we understand they are close to achieving this,” it said.

Two other companies indicated that they expected to sign the contract soon.

However, Rydon Homes insisted it was being treated unfairly by being asked to commit to the scheme even though it produced only around 16 new family homes annually. Most small and medium housebuilders have not been asked to sign the contract.

“When the DLUHC wishes to extend the contractual scheme to all SME developers, Rydon Homes Ltd will engage with that process, with a view to agreeing to enter into a fair and reasonable agreement with the government,” it said.

Additional reporting by Joshua Oliver