Schedule 8: Remediation costs under qualifying leases Paragraph 8: No service charge payable for cladding remediation Background
This is a new provision.
	The provisions in Schedule 8 protect leaseholders from the costs associated with historical building safety defects, defined in paragraph 1 as relevant measures. Paragraphs 5 to 7 make provision for qualifying leaseholder contributions towards relevant measures to be subject to a cap ("the permitted maximum"). This paragraph provides for qualifying leaseholders to be fully protected from the costs associated with cladding remediation. This means that the qualifying leaseholder contribution caps only apply in respect of relevant measures which are not related to cladding remediation costs; in other words, applying to non-cladding costs, including the remediation of non-cladding defects and the costs associated with mitigating measures such as fire alarms and interim measures like waking watches.
	Although this paragraph provides that no cladding costs be charged to leaseholders going forward (i.e., after commencement), any leaseholder contributions towards cladding remediation that have been incurred prior to commencement do count towards the leaseholder contribution caps.
Example
A qualifying leaseholder of a flat in London has a permitted maximum of £15,000 and has already paid £5,000 towards cladding costs on their building. They are legally protected from cladding costs going forward. The cladding costs that they have already paid out count against their contribution permitted maximum (the "capped" amount). This means that their landlord can charge the leaseholder a maximum of £10,000 towards non-cladding costs. The maximum that the landlord would be able to charge the leaseholder in a 12-month period is £1,500 (one tenth of the permitted maximum of £15,000 for a flat in London).