Unexpected Hurdle to Funding

In March 2020, the government introduced the Building Safety Fund. An emergency fund of £1.6 billion to support the remediation of unsafe cladding systems on residential buildings over 18 metres.

This fund has also been supplemented this year by a further Government pledge of an additional £3.5 billion to fund these remediation works.

The value of Government funding is significant, but so too is the scale of the problem. It is estimated that over 1,700 high-rise buildings in the UK require the replacement of unsafe cladding at the cost of around £15 billion.

The Race to Secure Government Funding Is On

If you are a developer whose application to the Building Safety Fund has been accepted in principle, you could be forgiven for thinking that is the hard part out of the way. It is important to note that you will need to satisfy the legal due diligence requirements of the Building Safety Fund's delivery partners – Homes England and the Greater London Authority.

Part of this legal due diligence process involves a thorough review of the development's construction package. As a minimum, Homes England and Greater London Authority will need to see, in respect of the cladding remediation works:

  • an institutionally acceptable form of building contract (such as a JCT Standard Building Contract (2016) subject to a Schedule of Amendments);
  • contracts of appointment with your professional team consultants who are responsible for design; and
  • main contractor and consultant forms of collateral warranty.

If there are any missing construction documents on review or not in a suitable form, then the funds will be withheld until the issues are resolved. At best, this inevitably leads to delay, but at worst, it can derail the whole project.

Therefore, it is important to consult a specialist construction lawyer before putting any construction contracts in place. These problems can be avoided by ensuring the construction contracts are prepared for the Building Safety Fund's requirements from the outset.

We're Here to Help

Myerson's Construction Team have experience preparing construction contracts for the remediation of unsafe cladding on high-rise buildings. For more information on the Construction Team's legal services, please call us on 0161 941 4000 or email the Construction Team.