The government has today announced a new fund of £3.5 billion as part of a pledge “to fully fund the cost of replacing unsafe cladding for all leaseholders in residential buildings 18 metres (6 storeys) and over in England ”.

Although further details are awaited, the £3.5 billion fund, announced today, is the latest in a number of government funds intended to finance certain costs associated with building safety on high rise buildings.

In the private sector, the first of these was the £200 million fund announced on 9 May 2019 which focused on the replacement of unsafe ACM cladding from privately owned buildings over 18 metres high.  Please click here for our insight.  The government had already established a £400 million fund in May 2018 for the replacement of unsafe ACM cladding in the social housing sector. Next came the £1 billion Building Safety Fund announcement on 11 March 2020 for the removal and replacement of unsafe non-ACM cladding systems from high-rise residential buildings in both the private and social housing sectors.

Registration for applications for both the ACM cladding and non-ACM cladding funds have closed.  However, the government previously announced that the deadline for building owners to complete their applications for the Building Safety Fund has been extended from December 2020 to 30 June 2021.  It is not clear from today’s announcement what the application process for the new £3.5 billion fund will be.

Most recently, December 2020 saw the announcement of a £30 million Waking Watch Relief Fund for the installation of fire alarm systems in private sector high-rise buildings with unsafe cladding after 17 December 2020. The application process for this opened on 31 January 2021 in relation to private sector buildings in England (except in Greater London) and all eligible social sector buildings.  In Greater London, applications will open on a date to be fixed before 22 March 2021 with the Greater London Authority administering the fund.

In its press release today, the government has also indicated that arrangements for buildings between 11 and 18 metres will involve a scheme for replacement of cladding through long-term, low interest and government-backed loans.  Further details are awaited of this scheme.

In addition to the increase in funding announced today, the government confirmed its intention to introduce a new levy on developers when seeking permission to develop certain high-rise buildings in England as well as a new residential developer tax. My colleague Helen Coward has commented on the proposed residential developer tax here.