Building firms’ £15bn bonanza since Grenfell
Leaseholders face ruin, but construction bosses cash in
BUILDING firms linked to Britain’s unsafe housing crisis have made more than £15billion in profit since the Grenfell Tower disaster.
The astonishing success of major property developers and construction companies has allowed them to pay shareholders dividends of £5billion.
The biggest ten firms paid their chief executives an average total salary of £2million in the last financial year.
Meanwhile, leaseholders who bought these companies’ homes have just spent another Christmas in unsafe, unsellable properties. Many are facing bankruptcy.
Hundreds of thousands of them are looking at average bills of £40,000 – and some up to £115,000 – to replace dangerous cladding, similar to that found on Grenfell Tower in west London, where an inferno killed 72 people in June 2017.
The Government has set aside £1.6billion to fund repairs, but MPs estimate the work could cost £15billion. It cannot begin until comprehensive funding is released.
The leaseholders are already paying at least £2.2billion a year between them for stop-gap safety measures and costlier insurance.
The Mail has launched a campaign to end the scandal. We want ministers to fix Britain’s dangerous buildings within 18 months and spare leaseholders the crippling financial burdens.
This paper is also demanding that the firms responsible pay their fair share, minimising the burden on the taxpayer.
An audit of financial records shows the builder Persimmon has made pre-tax profit of £2.1billion since the Grenfell tragedy – not including its 2020 figures, which aren’t out. In 2018, the then chief executive, Jeff Fairburn, quit after earning £85million in two years thanks in part to bonuses. In the same period, managing director David Jenkinson took £45million.
New boss Dean Finch could earn £3.6million a year if he reaches his performance targets.
Taylor Wimpey also had a bumper year after Grenfell, posting a pretax profit of £811million for 2018 – up 19 per cent in 12 months.
David Thomas, Barratt’s chief executive, was paid £3.6million in 2019, mostly made up of bonuses.
Meanwhile, Kingspan, an £11billion Irish firm, faces pressure to help leaseholders for selling insulation based on a flawed fire test in 2005. The Grenfell inquiry heard how its K15 panels – thought to be the most commonly used insulation board – caused a ‘raging inferno’ and failed a 2007 test.
Kingspan bosses have cashed in company shares worth £123million since the Grenfell tragedy.
The Mail also asked 12 of the biggest property developers how many of their homes had cladding or other safety issues, and how much money they were putting towards fixing the problem. Only Taylor Wimpey provided details, saying it had set aside £40million to replace flammable cladding.
Leaseholder Giles Grover, cofounder of the End Our Cladding Scandal campaign, said: ‘The billions of pounds worth of profits made by the construction industry and the millions paid to directors and shareholders since the Grenfell tragedy is a damning indictment of the Government’s failure to hold the developers and builders to account.’
He said weak housing regulations had let ‘builders cut important safety corners to eke out a few pounds more of profit’.
He added: ‘The Government has, belatedly, conceded that the industry must pay. It is time the Government stands four- square behind us, the truly innocent victims of this scandal.’
Industry body the Home Builders Federation said the flats in question were built and approved in line with building regulations at the time. A spokesman said its members were ‘keen to explore sensible solutions’.