Residents living with Grenfell-like cladding lining their apartment blocks in Greenwich have finally been given clarity over who will pay for safety improvements.

With more than 1,000 homes, the 11 blocks at New Capital Quay near Deptford Creek is thought to be one of the UK’s largest developments that has been found to have flammable cladding.

Residents have been left in a “terrifying” limbo after a row between insurers and developers Galliard  broke out over who was to foot the bill for the removal of the cladding.

Residents appealed to councillors back in March to take action over the cladding, which has failed government safety tests.

The National House Building Council has now announced it will be paying for works – which are estimated to cost up to £40m.

A spokesman said: “As the warranty insurance provider at New Capital Quay, NHBC has investigated a claim under our policy and we can confirm that we have accepted this claim.

“This has been a highly complex process and residents have understandably been concerned.

“We have made every effort to ensure they have been kept informed throughout the process and residents can now be assured that they will not have to bear the costs of the work.”

Council leader Danny Thorpe said this was a welcome result, adding that the council would help where it can.

Cllr Thorpe said: “This decision regarding New Capital Quay is extremely welcome and long overdue.

“The residents affected by ACM Cladding have been put under an enormous strain and this council, along with local MP Matthew Pennycook and our local ward councillors, have supported their calls for the blocks to be replaced with new safe cladding.

“The safety of residents is a top priority for the Council and as such, officers have been working tirelessly to broker communication and resolution between the building owner, the NHBC and all other interested parties.

“With a decision now made on who will pay for the removal of the cladding, the Council will continue to support the building owner and other parties and to provide any assistance to enable the end technical solution to be implemented in a planned way.”

Matthew Pennycook, MP for Greenwich and Woolwich, said it was “fantastic news” for residents.

A recent FoI put in to Greenwich Council revealed that 223 privately owned blocks have been investigated by Greenwich Council since Grenfell fire.

Since 2012, 28 buildings have been found to have unfit claddding in the borough.