Written statement made by , Parliamentary Under Secretary
of State for Local Growth and Building Safety
The Building Safety Act 2022 introduced a power for the Secretary
of State to introduce a levy on new residential buildings
requiring certain building control approvals in England, to raise
revenue for the purpose of building safety expenditure. The
Government has committed to ensuring buildings over 11 metres
tall with unsafe cladding are fixed as quickly as possible, and
to protecting the taxpayer and leaseholders from further
remediation costs. The Building Safety Levy, first announced in
2021, is one of the measures we are implementing to ensure that
the industry responsible makes a fair contribution to fix
building safety issues. It will be collected by local authorities
on behalf of central government.
As part of the Remediation Acceleration Plan published in
December 2024, the DPM announced her intention that the levy
would come into effect in Autumn 2025. To give the housing sector
more time to adapt, we have determined that the levy regulations
will be laid in Parliament later this year, and the levy will now
come into effect in Autumn 2026. This will give
local government, the Building Safety Regulator, and Registered
Building Control approvers a further 12 months to prepare for the
levy, and housing developers who will pay the levy more time to
factor levy costs into their plans.
This will in no way impact the pace of remediation; the
government is committed to fixing building safety defects as
quickly as possible.
In order to give housing developers as much time as possible to
factor the cost of the levy into their plans for upcoming
developments, I am today announcing the levy rates, that will be
applied when the levy comes into force. These are included in the
response to the levy technical consultation, which I am
publishing today, having taken into account the feedback to this
consultation and to the previous consultation on the levy. The
technical consultation response provides further detail on the
operation of the levy.
Levy rates have been set for each local authority area using
average house prices for that area. Therefore, the levy rate is
highest in those areas with the highest house prices, and lowest
in those areas with the lowest house prices. This will help to
mitigate the housing supply impact of the levy. A discounted rate
of 50% of the standard levy rate has been set for works on
previously developed (sometimes known as ‘brownfield') land, to
reflect the higher cost of building on this type of land.
Affordable housing and community facilities, and small
developments with fewer than ten units are exempt from paying the
levy. The levy will be charged per square-metre of floorspace in
a chargeable development. The rates are therefore set per
square-metre.
