Propertymark has criticised the Scottish Government’s proposed Building Safety Levy in a recent consultation.
Following the Grenfell Tower fire in 2017, each UK nation is developing its own system of replacing flammable cladding in high-rise buildings. In June 2024, the Housing (Cladding Remediation) (Scotland) Act 2024 received Royal Assent, which gave Scottish Ministers the power to arrange for assessments of buildings over 11 metres that were suspected to contain flammable cladding and arrange for works to replace them. Proposals are now being considered for how this would be funded.
The Levy in Scotland would function as a self-assessed tax which would be paid by developers of new residential homes. However, there are some proposals for exemptions which would apply to smaller developers and affordable homes.
In its response, Propertymark stressed that the Levy is not the most appropriate way of funding actions to remediate unsafe cladding. Instead, charges should be directed to and only apply to developers and individuals who were responsible for having the cladding installed, as any sector-wide tax could cut the supply of homes.
Therefore, the industry body has said that any landlord or developer who did not add unsafe or flammable cladding must not pay for the actions of those who did. At the same time, however, the Levy must not add to the cost of building new homes in Scotland due to the country’s ongoing housing crisis.
Finally, Propertymark thinks that the Levy should be reduced or stopped once all cladding has been remediated. This would incentivise those who made the decision to install unsafe cladding to replace it quickly, which would also reduce the overall cost of the Scottish Government’s cladding remediation programme.
Many governments throughout the UK are now dedicated towards retrofitting all unsafe buildings because of the Grenfell Tower fire.
Although the design of Scotland’s own Levy will be determined by the conclusions of its consultation on this issue, the Scottish Government has been demanding powers to be transferred from the UK Government to create this Levy and has been doing so since the Scottish Government’s 2023/2024 Programme for the UK Government began.
The Scottish Government is studying many choices to fund the remediation of roughly 6,000 buildings with possible unsafe cladding in Scotland, something Propertymark supports.
Henry Griffith, policy and campaigns officer at Propertymark, said: “Propertymark fully supports the Scottish Government’s commitment to end the country’s cladding crisis. However, given the current housing challenges that affect the country, an additional tax on all new homes could worsen Scotland’s housing crisis.
“Furthermore, charges targeted at those responsible for installing the cladding in the first place would help to incentivise the quick replacement of cladding without charging developers who never installed flammable cladding in the first place.”
