Hi
Polystyrene foam and PVC cable are a known problem. I gather the polystyrene slowly turns the PVC to goo somehow, and the result is eventual fire.
So, as has been said, it doesnt sound like a fire tomorrow type situation, but I would say it really does need fixing, along with any other places they've done this.
Also check the building for polystyrene balls insulation, thats usually where these problems arise.
Regards, NT