When Roger Devlin was parachuted in as Persimmon's chairman, the housebuilder was gripped by several crises.A byword for corporate excess, it was embr
When Roger Devlin was parachuted in as Persimmon’s chairman, the housebuilder was gripped by several crises.
A byword for corporate excess, it was embroiled in rows over eye-watering bonuses, shoddy homes and poor customer service.
As anger grew, critics touted former boss Jeff Fairburn’s £85million pay package as proof it had lost the plot.
Corporate excess: Critics touted former Persimmon boss Jeff Fairburn’s £85m pay package as proof it had lost the plot
Devlin, a gambling industry veteran and former Football Association executive, was tasked with repairing Persimmon’s battered reputation.
Fairburn did not last long and Devlin pledged to improve build quality after its industry rating was cut from five to four stars.
This effort to draw a line under the past was on show again yesterday, as Devlin, 63, announced it will cough up £75million to help victims of the cladding scandal.
More than 1m homeowners have been unable to sell or remortgage flats since the Grenfell Tower inferno in London, after buildings with similar cladding were deemed fire risks. Leaseholders face an average bill of £40,000 to fix the flats.
And although Persimmon is better known for building houses, it has identified 26 buildings with cladding it had constructed – and admitted it had ‘a duty’ to help leaseholders.
Just before the Government separately pledged action, the firm vowed it would ‘make sure the work is done’.
Devlin added: ‘The concern around now-banned cladding is affecting many thousands of homeowners who live in high-rise buildings.
‘At Persimmon we believe we have a clear duty to act to address this issue.’
The pledge was a significant victory for campaigners and the Daily Mail, which has called for ministers and developers to make homes safe within 18 months. For Devlin, it was the latest attempt to rehabilitate Persimmon’s image.
The former chairman of William Hill and brewer Marston’s promised an overhaul in 2018 after an outcry.
Persimmon faced fierce criticism after handing Fairburn £85million in pay and bonuses over two years, while the Mail highlighted a string of developments with serious defects, such as leaks, exposed nails, doors that did not close and toilets that flushed boiling water.
Critics said the problems were even more outrageous because Persimmon is Britain’s most profitable builder, raking in £1billion a year, with nearly half of sales through the Government Help to Buy scheme.
It was told in 2019 that ministers were so angry about the controversies that it risked losing access to the taxpayer-funded programme unless standards improved.
Former housing minister James Brokenshire told an industry gathering that year that, for many, owning a home was a big, emotional investment.
He added: ‘For that to go from being a cherished dream to becoming a nightmare of snagging problems months after moving in, and punitive costs, is simply unacceptable.’
Since then, Devlin has made improving customer service a top priority at the company.
Last year Persimmon avoided using the furlough scheme.
He will be hoping his announcement yesterday will go some way to getting Persimmon back into customers’ good books.
Why we had to tackle this issue head on
Clean up: Persimmon’s chairman Roger Devlin
By ROGER DEVLIN PERSIMMON CHAIRMAN
We have all been concerned to read of innocent leaseholders facing huge bills for safety measures, insurance rises and the cost of repairs to remove now-banned cladding.
There are also examples of the issue broadening to affect the ability of many to sell their homes. The Daily Mail has highlighted their plight and called for action.
Persimmon’s new chief executive, Dean Finch, and I agree that we cannot just stand by. We have a responsibility to step forward and tackle this issue head-on.
This is why we have set aside £75million to pay for our contribution to any necessary work on the 26 apartment blocks Persimmon has built that might be affected by the cladding issue.
We are not a major developer of high-rise blocks – we built fewer than 1 per cent of all those constructed.
However, we have in the past used cladding materials which met the fire safety rules and regulations in place at the time, but which now may be considered unsafe and require removal.
We have identified nine high-rise buildings above 18 metres high that we built and may require work.
We no longer own any of these buildings and the legal responsibility rests with the existing owner. We will provide technical support to ensure the building is safe.
But if the owner fails to step up, we stand ready to go further and provide support to make sure the work is done to make the buildings safe.
We have also identified 17 buildings below 18 metres that may have cladding that requires detailed investigation. Here, the Government has recommended a risk-based approach.
Where we own the building we will, of course, lead this work. Where we do not own the building, we will support the owners and other parties to ensure the buildings are safe for the residents.
Once again, if the owners fail to meet their obligations, we stand ready to provide support to make sure this happens.
This is a decision we believe is not only right for the residents, but is also the right thing for us to do as one the UK’s largest housebuilders.
We want to build a business with a long-term, responsible and sustainable future – to not only build thousands of much-needed homes but also support jobs and prosperity across the UK.
We are also ready to sit down with the Government to see what more the housebuilding sector can do to address this situation.
We all want to find a way to deal with unsafe cladding once and for all – and we know the sector must play its part.
But we need to do it in a way that ensures companies like Persimmon are still able to carry on building the affordable homes we need to meet the Government’s targets.
The Daily Mail has rightly highlighted the pressing need to address unsafe cladding.
At Persimmon, we hope our announcement will be a first step in finding a sustainable, long-term solution – and delivering a brighter future for the leaseholders affected.