I removed the wheels to get to all the screws, removed the liner, cleaned the compacted mud/ crap then painted the inside of the lip with smootrite to help stop the rust problem.
The mk4s had a similar problem but there's were due to a foam pad which stopped the plastic arch rubbing on the panel, this held moisture and it was recommended to trim a couple of inches off where it sat into the inner lip. When i removed the liner i found my mk5 had the same foam so trimmed this, along with the hammerite i'm hoping i wont have the rust problem?