Building Safety and Cladding

The Building Safety Act 2022 came into force in stages from April 2022. It establishes two distinct but related regimes: a new regulatory framework for higher-risk buildings (generally those 18 metres or seven storeys in height or above, containing at least two residential units), and a set of protections for leaseholders in buildings affected by historical safety defects — principally, but not limited to, unsafe cladding. This section focuses on the leaseholder cost protections.

The leaseholder protections were introduced following the Grenfell Tower fire in June 2017 and the subsequent discovery of widespread unsafe cladding on residential buildings across England and Wales. The protections are set out primarily in Schedule 8 of the Building Safety Act 2022. They restrict the extent to which qualifying leaseholders may be required to contribute to the cost of remediating relevant defects through their service charge.

Which Buildings Are Covered

The leaseholder cost protections apply to relevant buildings — those that are at least 11 metres or at least five storeys in height, and that contain at least two dwellings. This threshold is lower than the 18-metre or seven-storey threshold used for the general higher-risk building regulatory regime under the Act. A building that does not qualify as a higher-risk building under the general regime may nonetheless be a relevant building for the purposes of the leaseholder cost protections.

The protections relate to historical building safety defects — defects arising from the design, construction, or refurbishment of the building before the relevant date under the Act. Defects arising after that date are not historical defects for these purposes and are not within the scope of the cost protections. Houses are not relevant buildings for the purposes of the cost protections, which apply to buildings containing dwellings in multiple occupation (blocks of flats). Mixed-use buildings may qualify if they meet the height or storey threshold and contain at least two dwellings.

Qualifying Leaseholder Status

The cost protections apply only to qualifying leaseholders. A qualifying leaseholder is a person who, on 14 February 2022 (the date the Building Safety Bill was introduced in Parliament), held a long lease of a dwelling in a relevant building, and who either: (a) occupied that dwelling as their only or principal home on that date; or (b) held long leases of no more than three dwellings in total across England and Wales on that date.

The 14 February 2022 date is the critical cut-off. A leaseholder who purchased their flat after that date is not excluded from protection — the qualifying leaseholder status established on that date passes to successors in title. If the person who held the lease on 14 February 2022 was a qualifying leaseholder, anyone who subsequently acquires the lease inherits that protection. A leaseholder who purchased after 14 February 2022 in a relevant building should establish whether their predecessor in title had qualifying status.

A landlord certificate is the mechanism for establishing qualifying leaseholder status under the Act. The accountable person or landlord must issue a certificate if requested. Where a certificate has not been issued and a remediation cost is being demanded, the leaseholder may request one and should do so before any payment is made.

What Qualifying Leaseholders Cannot Be Charged For

Schedule 8 of the Building Safety Act 2022 establishes a hierarchy of responsibility for the costs of remediating relevant defects. Qualifying leaseholders sit at the bottom of that hierarchy — they are the last resort, and in many cases they are protected entirely.

For cladding defects, the protection is absolute. Qualifying leaseholders cannot be required to contribute to the cost of remediating cladding defects through their service charge, regardless of circumstances. There is no cap — the cost is zero.

For other relevant defects, qualifying leaseholders are protected by a cap on their contribution. The cap is calculated by reference to the value of the dwelling (the "relevant percentage"). In most cases, this results in a very low or zero liability. The precise cap depends on the property value and the applicable percentage set out in Schedule 8.

Before a qualifying leaseholder can be required to pay anything, the Act requires that liability be established by working through the hierarchy: the developer or associated landlord (where they have sufficient net worth — assessed at more than £2 million per relevant building) bears primary responsibility; the building owner bears responsibility where they are linked to the developer; government schemes — including the Cladding Safety Scheme for buildings between 11 and 18 metres, and the Building Safety Fund for taller buildings — cover costs that cannot be recovered from the hierarchy above. Only where those routes are exhausted does any residual liability fall on the leaseholder, subject to the caps.

What Counts as a Relevant Defect

A relevant defect under the Building Safety Act 2022 is a defect in a relevant building that arises from anything done, or not done, in connection with the design, construction, or refurbishment of the building, where that design, construction, or refurbishment occurred before 28 June 2017. The defect must create a risk to the safety of people in or about the building from fire or from structural failure.

Relevant defects include: defective cladding systems (external wall systems that do not comply with applicable fire safety requirements); failed fire doors or defective fire-stopping; failures of internal compartmentation that would allow fire to spread; and structural defects that create a risk of collapse. A relevant defect is not limited to cladding — any historical safety defect falling within the definition is within scope.

Not every defect in a building is a relevant defect. Routine maintenance failures, defects unrelated to fire or structural safety, and defects arising from work carried out after 28 June 2017 are outside the definition. Whether a particular defect is a relevant defect is a factual and technical question; specialist advice is usually required to establish it.

Who to Contact

Where a leaseholder in a relevant building receives a demand for remediation costs — whether labelled as a service charge, a special levy, or otherwise — the first steps are to establish whether the building meets the relevant building definition, and whether the leaseholder holds qualifying leaseholder status. If both conditions are met, any demand that does not comply with the cost protections in Schedule 8 of the Building Safety Act 2022 may be challenged.

The Leasehold Advisory Service (LEASE) provides free initial guidance on leaseholder rights under the Building Safety Act 2022. LEASE is a government-funded advisory service and is a suitable first point of contact for leaseholders uncertain about their position. The Building Safety Regulator, administered through the Health and Safety Executive (HSE), oversees the regulatory regime for higher-risk buildings and handles complaints about accountable persons in those buildings. For disputes about whether a remediation cost can lawfully be charged, the First-tier Tribunal (Property Chamber) has jurisdiction. The Cladding Safety Scheme, administered by Homes England, covers funding for cladding remediation on buildings between 11 and 18 metres where developers have not funded the works. Contact details for each are at Useful Contacts.