Building Safety Fund – new details published in prospectus

The government published the prospectus for its £1bn Building Safety Fund on 26 May, providing detail of how building owners can apply for funding to remediate buildings with non-ACM combustible cladding. This funding is in addition to the £600m already provided for the removal and replacement of category 3 ACM cladding.

The prospectus clarifies that the fund will cover the costs of replacing dangerous cladding for all leaseholders of properties within scope of the fund, in both the private and social sectors. We have worked hard to secure this clarification, as we agree that leaseholders should not have to pay for these works.

Nevertheless, we recognise that significant challenges remain for housing associations, given the scale of the funding required to remediate buildings. We are continuing to work with the government to highlight these challenges.

Who is eligible for the fund?

We have been engaging with the government since the fund was announced on 11 March to understand whether and how housing associations can access funding.

The purpose of the fund is to support the remediation of unsafe non-ACM cladding systems on residential buildings that are 18m or over.

Within this scope, the prospectus provides further detail on eligibility for the fund, including that:

• In the social sector, the registration process is open to registered providers of social housing.
• Housing associations will be eligible to access the fund for one of two reasons:
  • Because they have residential leaseholders.
  • Where remediation costs threaten their financial viability.
• In applying for the fund, organisations will be required to submit a business case to MHCLG, setting out their financial position and options. The Regulator of Social Housing must be notified of their application as soon as possible.
• There is an expectation that potential applicants will have explored every option to fund remediation from sources other than leaseholders and government funding. The fund is predominantly aimed at supporting leaseholders in the private sector facing significant bills.

For housing associations with social housing units held in blocks owned in the private sector, these units will be eligible for funding as part of the relevant application for that building.

The fund will not be available for:

• Remediation work that had been committed to, or where work had started on site, prior to the announcement of the fund.
• Buildings under 18m in height (allowing for a 30cm tolerance).

How to apply

Potential applicants will first need to register their building(s) for the fund, in advance of the full application process. This process will be from 1 June to 31 July, and will enable the government to confirm eligibility in principle based on a technical assessment of the height of the building and its non-ACM cladding system. Non-ACM cladding systems will be assessed in line with the government’s updated building safety advice for building owners, including fire doors, published on 20 January.

The full application process will open by the end of July, and will only be open to those building owners, freeholders or responsible entities who register. Each building must be registered individually.

Registration will not guarantee that a building will receive funding, but it will help ensure that building owners receive support, where necessary, to identify the materials present on their building and plan remediation work.

The fund will not meet the cost of interim safety measures such as waking watches, and will be allocated on a first-come, first-served basis.

Further funding opportunities

Social housing providers can also claim a contribution from the government to their remediation project that is equivalent to the service charge increase which would otherwise be passed on to leaseholders, including those in shared ownership properties. This funding will be available for 2020/21.

Organisations do not need to register for the Building Safety Fund to claim this funding.

MHCLG will set out a separate claims process for this alongside the full application guidance in July. 

For full details of the fund, its scope, eligibility and the registration and application process, please download the prospectus.

If you have any questions, please get in touch with our Building Safety team.