Housebuilders have hit back at the
government’s “anti-development” plan to push ahead with a £3bn levy to pay for
fire safety repairs, saying the plan will punish “innocent” firms for the
failures of “the few”.
The Department for Levelling
Up, Housing and Communities yesterday published a
consultation on the Building Safety Levy, through which it plans to
raise £3bn over 10 years to pay for the remediation of “orphan” buildings where
no owner can be traced.
The department said the plan
was on top of £5.1bn already committed by the government to paying to solve
post-Grenfell fire safety problems in existing flat blocks, but the industry said
the new levy would be in addition to more than £4bn of additional costs already
levied upon it.
The levy was originally
announced by Michael Gove in April during his first stint as housing secretary
as a way to pay to help thousands of leaseholders stuck in blocks of flats now
seen as unsafe but without adequate routes to fund repairs.
However, housebuilders have
consistently argued that they have paid to repair their own buildings via the £2bn
cladding pledge, as well as having contributed an estimated £2bn-3bn
via the Residential Property Developer Tax, and shouldn’t have to pay again via
a new levy.
Stewart Baseley, executive
chair of the Home Builders’ Federation, said UK housebuilders were committed to
helping leaseholders by remediating the buildings they built but that the levy
was the sign of an “increasingly anti-development and anti-business policy
regime” which had “serious implications for home ownership, investment and
admitted that the levy had the ability to impact upon scheme viability, “which
in turn would affect the overall numbers of homes being built”.
Baseley said: “In the midst
of a recession, it is disappointing for government to create more barriers to
investment with a move that will further threaten supply, in particular of
“Building new homes may not
be politically attractive but the country faces an acute housing affordability
crisis and the construction of new homes supports millions of British jobs.”
He added that government has
failed to pursue product manufacturers, with ministers acknowledging that UK
housebuilders are easier to tax and threaten.
Meanwhile Rico Wojtulewicz,
head of housing and planning policy at the National Federation of Builders,
which represent SME housebuilders, said the government was targeting the whole
development industry to pay for problems created by a small number of
developers and builders. He said: “You can’t hold innocent people accountable
for failures of the few. The guilty party should pay – but that’s not going to
happen under this legislation.”
Under the government’s
proposals, builders will have to pay the levy as part of the building control
process, with the smallest developments – likely those of under 10 homes – and
affordable housing schemes given an exemption from the charge. The department
said it had not decided whether to exemption build to rent and student housing
from the charge.
The consultation also made
clear that local authorities will be responsible for collecting the levy, which
will be variable depending either upon local or regional valuations, or upon
whether schemes are brownfield or greenfield.
The department’s consultation
paper said the expected £300m annual revenue raised by the levy was equivalent
to just 4% of the development sector’s annual planning contributions in CIL and
section 106 agreements.
Launching the consultation yesterday,
building safety minister Lee Rowley said: “We have been clear that developers
must pay to fix building safety issues and the Building Safety Levy is an
important part of making that a reality.
“By having these plans in
place, we can ensure that all leaseholders are protected, regardless of whether
their developer has pledged to remediate or not.”
Taken from an article in Housing Today 23 November 2022