Housebuilder Taylor Wimpey has announced it will pay out £125 million to fund the replacement of cladding and other fire safety work on all its developments built in the past 20 years.
The money is set to be placed in a fund “in order to provide certainty for customers and leaseholders and to avoid them bearing the cost of investment to ensure their buildings are safe”, the company said.
It comes less than a month after ministers set aside £3.5 billion in funding to help repair or replace cladding more than three years on from the Grenfell Tower fire.
Taylor Wimpey said the company fund would cover any block built in the past two decades, including those less than 18 metres tall which are not eligible for government grants.
Bosses made the announcement as they revealed a 36% fall in revenues in 2020 due to Covid-related hits to the business. Revenues hit £2.79 billion, whilst pre-tax profits fell 68% to £264 million.
But the company said it was confident the housing market will strengthen and will continue to actively buy land for future developments as orders for new homes increased.
It also announced a return of a dividend – handing out £151 million to shareholders or 4.14p a share.
Chief executive Pete Redfern said: “We are confident in the medium-term performance of the housing market and therefore accelerated our land purchases from May 2020 as high-quality land became available at attractive rates.
“We are now focusing on driving efficiencies across the business, the rollout of our new house type range and implementing our ambitious new environmental strategy.
“The UK housing market has been resilient and continues to reinforce our confidence in our outlook.
“We are a cash generative business with a strong balance sheet, and we are pleased to announce today that we will reinstate our ordinary dividend in line with our aim of providing a reliable income stream to our shareholders.”
On the £125 million cladding fund, he added: “We have taken this decision in order to provide certainty for customers and leaseholders and to avoid them bearing the cost of investment to ensure their buildings are safe.”
The announcement comes less than a month after rival housebuilder Persimmon announced it would spend £75 million to cover the costs of replacing unsafe cladding on 26 multi-storey buildings it had built.
Housing Secretary Robert Jenrick said: “I welcome today’s announcement that Taylor Wimpey is paying for the remediation of unsafe cladding on the properties they built.
“This is the responsible approach that I expect developers across the country to take and I’m calling on others to do the right thing as well.
“Where the industry has not yet done so, the Government is stepping in with over £5 billion in funding to protect leaseholders from the costs of cladding remediation.”