Dereliction of duty: housing associations & building safety

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The End Our Cladding Scandal (EOCS) campaign recently published a report on housing associations and building safety: Dereliction of Duty: How housing associations failed leaseholders trapped in the building safety crisis. It makes for sobering reading. But it’s essential reading for shared owners and shared ownership providers. Nearly 83% of those surveyed purchased their home via the shared ownership scheme.

Dereliction of Duty - a report by the EOCS campaign on how housing associations failed leaseholders trapped in the building safety crisis
Dereliction of Duty report

In this feature Shared Ownership Resources shares some key findings from Dereliction of Duty.

The building safety scandal is a monumental human rights crisis

Leilani Farha wrote to the UK Government in 2020 to express concerns that it was disregarding the human rights of people living in unsafe buildings.


“A significant number of people in the UK continue to be abandoned, their human rights being breached by their housing providers. Shockingly, those responsible are not only ‘the usual suspects’ – private, for-profit developers and investors – but are also housing associations, who typically espouse strong social values and the objective of providing safe, affordable housing to those who need it.”

Leilani Farha, United Nations Special Rapporteur on the Right to Housing (2014 to 2020), Dereliction of Duty

Counting the cost

  • 352 households responded to the EOCS survey
  • The vast majority of respondents (289 or 82.8%) had bought via shared ownership
  • 67.3% of shared owner respondents currently own a minority equity share of 50% or less
  • 106 respondents had received estimated costs
    • 51% faced a personal bill of over £20,000
    • 35% faced a personal bill of over £50,000
  • 8 in 10 worried about costs and/or had researched bankruptcy
  • Over 9 in 10 said that the building safety crisis had impacted their mental health
  • 1 in 5 had been prescribed medication or taken time off work due to stress and anxiety

Who should be responsible for building safety remediation costs?

Shockingly, more than four years after the Grenfell fire, this is still an ongoing debate. But EOCS are clear who shouldn’t be responsible.


“Leaseholders, whether in the private or social housing sector, should not bear the costs of the building safety crisis”.

End Our Cladding Scandal, Dereliction of Duty, 2022

EOCS point out that leaseholders in both the private and social housing sector are the victims of monumental system failure:

  • regulations which weren’t fit for purpose;
  • manufacturers who mis-sold their products;
  • developers who sought to cut corners and maximise profit at the expense of fire safety;
  • building control officers who knowingly signed off unsafe buildings; and
  • insurance companies who are leveraging this crisis to increase premiums by an average of more than 400%.

Shared ownership, housing associations and building safety

Who owns what? Who pays for what?

EOCS found that many respondents felt misled by the sales and marketing of shared ownership. (An issue on which Shared Ownership Resources has previously reported). The report quotes LEASE and Share to Buy websites: ‘The leasehold ownership of a flat usually relates to everything within the four walls of the property, including floorboards and plaster to walls and ceilings, but does not usually include the external or structural walls‘. LEASE and Share to Buy both go on to say: “The freeholder is responsible for the maintenance and repair of the building, with costs for doing so being recoverable through the service charges which are billed to the leaseholders”.

But are crucial distinctions between ‘ownership’, repairing obligations and legal liabilities for repair and maintenance costs clearly communicated by housing associations? Take a look at housing association Metropolitan’s website (accessed 22 February 2022) and make up your own mind.

https://www.mtvh.co.uk/manage-your-home/repairs/repair-responsibilities/

100% liability

Shared ownership leaseholders are particularly badly impacted. They have to pay 100% of remediation costs although they only ‘own’ a share of their lease. Perhaps as little as 25%.

Affordability

Most shared owners had to meet stringent affordability tests in order to access ‘affordable’ housing schemes. Yet this seems to be irrelevant when it comes to the exceptionally high bills for building safety remediation.


“Costs not yet confirmed but estimated at £47k. It was suggested we could approach our banks or mortgage providers for a loan, or spread payments over 10 months.”

Onward Homes Group leaseholder, Dereliction of Duty, 2022

Conclusions and recommendations

Not surprisingly, EOCS conclude that housing associations are failing those caught up in the national building safety crisis. So the report includes a number of detailed recommendations. One key recommendation is to actively involve residents – including leaseholder and cladding action groups. This is essential to drive meaningful reform to uphold the human rights of those affected by the building safety crisis.


(Who are EOCS? The campaign is a resident-led collaboration between Inside Housing, the UK Cladding Action Group, Manchester Cladiators, Grenfell United and other resident groups. In September 2020 EOCS set out 10 steps to fix the building safety crisis following the Grenfell Tower fire. 72 people died in the horror of that fire.)


UPDATE 28 February 2022: Caroline Lucas, Green Party, has tabled a question to be answered by the Department for Levelling Up,Housing and Communities (LUHC).


To ask the Secretary of State for Levelling Up, Housing and Communities, what assessment he has made of the implications for his policies of the recommendation in End Our Cladding Scandal’s Dereliction of Duty report, published on 20 February 2022, on strengthening the role of the Regulator of Social Housing and Housing Ombudsman to ensure that (a) housing associations are held to account for their obligations relating to building safety and (b) leaseholders are able to obtain appropriate redress in circumstances where a housing association is found to have failed to uphold those obligations; and if he will make a statement.

Caroline Lucas, Green Party

https://questions-statements.parliament.uk/written-questions/detail/2022-02-24/129105

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