Boris Johnson has been warned by rebel Tory MPs that leaseholders will not “forget or forgive” having to pay out for emergency fire safety work on their flats.
The Commons voted 340 to 225, majority 115, to remove changes made by peers to the Fire Safety Bill which would have banned building owners passing on the costs.
A separate attempt to protect leaseholders by Tory MP Stephen McPartland, backed by more than 30 Conservatives, in the wake of the Grenfell Tower disaster was not selected for a vote.
Downing Street had resisted the change with the PM’s press secretary Allegra Stratton claiming it would slow down attempts to make fire safety reforms.
Ahead of the vote, she said: “Of course we don’t support it.
“Our problem with McPartland’s amendment is that, far from speeding things up for constituents across the country who are worried about finding themselves in these properties, it would actually slow things down.
“We feel Conservative colleagues need to look carefully at an amendment that would actually slow it all down rather than get action as we want, which is as soon as possible.”
Ministers suggested the Building Safety Bill, expected in the Spring, was the more appropriate place for the measures.
But Tory Mr McPartland warned many freeholders could simply pass on the costs for measures like cladding to leaseholders.
“Depending on the terms of the lease and the costs involved, this could easily be a requirement for a leaseholder to pay £50,000 within weeks,” he said.
Fellow Tory MP Royston Smith said people “will not forget and they will not forgive” if leaseholders are forced to pay for remediation works.
He added: “This part of the housing market is heading for collapse and thousands of leaseholders are heading for bankruptcy.
“This Government could and should prevent this from happening.”
Shadow Fire Minister Sarah Jones said the Government of “broken their promise” to help leaseholders and to implement recommendations from the Grenfell Inquiry.
“They have continued in their failure to act and put the British public’s safety first,” she said.
“It is shameful that they have voted against implementing vital fire safety measures called for by the Grenfell Inquiry, and it is an insult to people across the country that this Government voted down protections for leaseholders from fire safety costs that they did not cause.”
Home Office Minister Kit Malthouse said: “The Building Safety Bill is the appropriate legislative mechanism for addressing these issues and it will be introduced in the spring.
“It will contain the detailed and complex legislation that is needed to address remediation costs.”
Ministers announced an £3.5bn package for the removal of unsafe cladding earlier this month – but it didn’t include buildings under 18m tall.