Labour hit out at Govt's cladding loan scheme which 'could take years to set up'

27 April 2021, 18:47 | Updated: 27 April 2021, 18:50

Nick Hardinges

By Nick Hardinges

Labour's shadow police and fire service minister has hit out at the government's cladding loan scheme after LBC revealed it could take years to set up.

Speaking in the Commons on Tuesday, Sarah Jones MP branded the scheme "vague and undefined" and warned it could lead to people losing money on their property's value.

Referencing an exclusive story by LBC Correspondent Rachael Venables, Ms Jones said the cladding loan scheme "won't actually be in place, we hear today, for at least two years", which, she added, could leave thousands of people paying "mounting waking watch bills and stuck in properties they can't sell".

On Tuesday, campaigners told LBC it could "be a couple of years" before the scheme is implemented.

They said they were informed during a meeting with the Department of Housing that it will be introduced alongside the already-delayed Building Safety Bill.

In that meeting, officials allegedly accepted the legislative process "could take years" to complete.

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Giles Grover, a campaigner from End Our Cladding Scandal, said the delay is already being felt: "One leaseholder recently got a bill for £78,000 to be paid in the next six months.

"We're also seeing managing agents writing on their letters to leaseholders saying 'you need to pay these bills' because the government hasn't yet come forth with details of the loan scheme.

"So what's really concerning - we asked what the timescales are, and they said the plan is to implement it alongside the Building Safety Bill.

"As we understand it, it's going to be a couple of years before that comes in."

There are fears the delay could leave many flat-owners at risk of bankruptcy and evictions, with many building owners expected to start remedial work in the coming months, demanding upfront funding from residents to cover bills in the millions of pounds.

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The loan scheme, which will cost billions, is part of the government's solution to the cladding crisis, exposed by the Grenfell tragedy.

Ministers plan to offer long-term loans against flats in buildings between 11 and 18 metres tall, capped at £50 a month, to pay to remove dangerous cladding.

But 11 weeks after the controversial plan was announced by Housing Secretary Robert Jenrick, no official details have been released.

Industry experts expect the legislation to take at least a year to fully pass, but it could take up to two-three years for full implementation.

Still, the plans are controversial, with many leasehold campaigners furious at the idea they would be expected to pay anything.

But for many, the loan scheme is better than nothing - and it is all that stands between them and bankruptcy.

The Ministry of Housing, Communities and Local Government said: "These claims are misleading - we're working as quickly as possible to launch the scheme and will publish more details on how it will work in due course."