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Call to sanction cladding suppliers that made £7.5bn profit since Grenfell disaster

<span>Photograph: Toby Melville/Reuters</span>
Photograph: Toby Melville/Reuters

Cladding and insulation manufacturers whose products were involved in the Grenfell Tower fire face calls for sanctions after failing to pay into multibillion-pound funding schemes to fix the country’s unsafe residential blocks.

The building supply firms Saint-Gobain and Kingspan have reported more than £7.5bn in global profits since the fire in June 2017 in west London which killed 72 people, corporate filings reveal. Combustible insulation products manufactured by both firms were installed on the tower.

The Construction Products Association in the UK, of which the two firms are members, has failed to agree with the government a voluntary funding scheme to strip buildings in England of combustible products.

Lisa Nandy, the shadow housing secretary, said in a parliamentary debate that the government’s failure to hold the manufacturers to account was “not just an unhelpful omission but an immoral one”.

Michael Gove, the housing secretary, last week gave developers a six-week ultimatum to sign a contract to fix their unsafe buildings, or face a ban from operating in the market. There is anger among campaigners that construction supply firms have not agreed a similar funding scheme despite pressure from the government.

Edward Daffarn, who had lived in Grenfell Tower and is on the committee of Grenfell United, said the government should impose sanctions on construction product firms which do not agree to contribute to remediation works.

He said: “The government needs to hold to account all those involved with the deaths of 72 people, particularly when they are making so much money.”

In January last year, Gove said he would not let building material firms that were making huge profits “off the hook”. A year later, no scheme has been agreed.. The association said last year there were “unanswered questions” and more work was required on the scope of the works.

Saint-Gobain, a multinational corporation based in France, owns the Celotex brand of insulation which was used on Grenfell. It reported record revenues in the first half of 2022 and since the Grenfell fire has reported more than £5.8bn in profits.

The public inquiry into the fire heard allegations in November 2020 that Celotex employees perpetrated a “fraud on the market” by rigging a fire test for RS5000, a combustible foam. A lawyer representing Celotex at the inquiry said there was “unacceptable conduct” by some former employees, but that it could be used in a cladding system with appropriate materials. The firm considers that the fire test had “no causative impact” on the use of the insulation at the tower and its lawyer cited evidence from an inquiry expert, which suggested the speed of the fire spread at Grenfell was primarily driven by the cladding rather than insulation.

The Ireland-based Kingspan group has reported more than £2bn in profits since the fire. The company manufactured K15, another insulation product which was used on Grenfell Tower and described in one fire test in 2007 as a “raging inferno”.

A lawyer for the firm at the inquiry said there were “shortcomings” in relation to testing and certification, but they did not cause the fire. The firm says K15 can safely be used in high-rise buildings when installed correctly. The firm says only about 5% of the insulation used at Grenfell was K15 and it was used incorrectly on the tower without its knowledge.

The American industrial company Arconic manufactured Reynobond PE, the cladding used on Grenfell which the first phase of the inquiry found was the primary cause of the spread of the fire. A lawyer representing the firm described the government’s claim that its guidance banned combustible cladding as a “political lie” and said the company was the victim of an agenda. The company considers the sale of the cladding was lawful and permitted by the regulations at the time.

UK home builders, meanwhile, say they are paying billions of pounds to fix the crisis through a residential property tax which came into force last April, voluntary pledges of £2.5bn and a proposed new building safety levy.

The Construction Products Association said: “We would welcome an opportunity to discuss this further with government to find a way forward.” The spokesperson said product manufacturers had already committed to “replacing any defective products at their own cost”.

Saint-Gobain said: “Any industry-wide initiatives need to be proportionate and fair. Saint-Gobain is of course willing to engage in further discussions.”

Kingspan said it would pay for remediation where its product K15 had been used inappropriately in a high-rise building and was ready to contribute to a joint government and industry funding mechanism. Arconic did not respond to a request for comment.

A department spokesperson said: “The Building Safety Act gave building owners new tools to pursue manufacturers of defective products through the courts to recover the costs of making buildings safe.

“No option is off the table when it comes to pursuing those companies whose behaviour has been exposed in testimony before the Grenfell inquiry.”