More than half a million council tenants are caught in a £2 billion black hole in the Government’s cladding compensation plan.
They have been left out of plans to lift the crippling cost of removing hazardous materials that is trapping leaseholders in unsellable private properties.
Town hall chiefs warn tenants, including the elderly in sheltered housing, will stay in dangerous homes unless builders or taxpayers pick up the bill.
In a huge Government U-turn last week, Housing Secretary Michael Gove announced developers must pay to fix the cladding crisis.
He gave the industry until March to get a plan to rectify unsafe cladding on medium-rise blocks at an estimated cost of £4billion.
Now council leaders fear the country’s entire social housing stock of four million homes – including sheltered and housing association properties – will be excluded.
A Local Government Association report estimates 3,000 buildings housing up to 533,500 tenants need urgent work.
The cost would cover replacing dangerous cladding, installation of sprinklers and other vital measures.
Bringing all council homes into line with climate change zero-carbon targets and other improvements would take the cost over 10 years to £8.1billion.
Fire safety is expected to take five years, with some buildings waiting ten years.
David Renard, of the LGA, which represents 350 English councils, said: “The construction industry must be made to fix the fire safety defects it built into blocks owned by councils.”
The Housing Department said private leaseholders in council blocks would be covered for compensation but council tenants will not be included.
