Dame Judith Hackitt.

Q63 The Chair: Good morning. This is the Industry and Regulators Committee of the House of Lords. We are conducting an inquiry into building safety regulation. Our witness this morning is Dame Judith Hackitt, who chairs the Building Control Independent Panel and who has a great deal of experience in these matters, particularly following Grenfell. Can I start by asking you to what extent you think the Building Safety Regulator (BSR) has fulfilled its purpose? We have heard about the changes that are now being proposed. Can you give us an idea of whether the recommendations in your independent review are being turned into practice and reality? Perhaps we could start there.

Dame Judith Hackitt: Thank you. The framework that I recommended has very much been put into place through the Building Safety Act 2022, and the role of the Building Safety Regulator is very much as I envisaged. In terms of some of the role definitions, I called for a joint competent authority and we have done it slightly different; nonetheless, I am very happy that the Building Safety Regulator is fulfilling the role that I saw was very much needed in bringing new levels of scrutiny to building safety.

Q64 The Chair: We have heard a bit about the problems that the Government are now trying to address—the delays and lack of consultation, which we will come to in detail—but, presumably, people have raised those with you. What does the Building Control Independent Panel do and how does it feed in? Do you feel that there is a responsiveness to anything that is said there?

Dame Judith Hackitt: Let me deal with the Building Control Independent Panel first, because that is fairly straightforward.

The panel has been set up in response to the public inquiry, in particular to answer two questions that were raised by the inquiry: one around whether people with a commercial interest can operate within a building control framework and how you can put measures in place to avoid conflict of interest through commercial interest; and secondly, whether there is a need for building control to be some form of national authority, rather than operating at a local level. This was the remit of the Building Control Independent Panel. We were set up in June. We have already had several meetings. The publication of our problem statement is imminent and we will start our consultation within days; we are anticipating reporting back on the work that the independent panel is doing in the autumn.

My role in relation to building safety more broadly has continued since I completed my review in 2018. For the past seven years, I have chaired the Industry Safety Steering Group, which was set up by the Government to monitor the progress the industry was making in making the changes it needed to make to meet the requirements of the Act. I am also involved now in the Building Industry Oversight Panel, chaired by the MHCLG. I have given many talks and have been involved in many exchanges with stakeholders in the industry, and throughout the professional bodies that support the industry, over the past five years, so I have been very much engaged in this process.

The Chair: In terms of next steps and further progress, where do we concentrate from here before we pick up some of your individual points? Is there one issue or direction that you think needs more concentration?

Dame Judith Hackitt: Fundamentally, the thing we need from hereon is better collaboration between industry and the regulator to understand both sides of this picture and to work together to resolve those issues. That is not to say it is not happening—it is; I know for a fact that they meet at least weekly to discuss the problems, and have been doing so for some time now—but it has taken far too long for that collaborative process to establish itself and address those issues. This is why, I think, we find ourselves with some particular challenges, most obviously the delays in approvals at Gateway 2 that we are now seeing in the system.

It is also important for us to remember that these are early days. This was never going to be easy because it is such a big change in culture and a shift in responsibility. Many of us always anticipated that this would be quite a bumpy ride but there are more things that we can do to smooth that out—and we need to do them quickly, which is why the Government are right to make the changes they are making.

The Chair: I think that colleagues will want to pick up on some of those points and go into more depth.

Q65 Lord Best: You stressed the need for collaboration between industry and the regulator. We have heard a lot of frustration from developers that the Building Safety Regulator does not give them any of the precise information that they need to get their approvals; they say, “We’re often getting a rather vague message from the BSR”. Do you think that there should be rather more prescriptive requirements—particularly covering Gateway 2, where so much delay is occurring—and that we should have a bit more prescription and precision in what the Building Safety Regulator requires of developers?

Dame Judith Hackitt: More guidance would be helpful. We need to be careful about words like “prescription”. If we look back at the reams of guidance that I uncovered as part of my review eight years ago, there has always been a huge amount of guidance for industry. It has not always been followed; indeed, it is often not followed, misinterpreted or whatever. It is a fundamental principle of the new Building Safety Act that the responsibility for delivering safe buildings lies with those who design and build them; that is a major change from where we were before, where it was all about getting sign-off from building control. Putting that responsibility with the industry requires it to be part of developing joint guidance with the regulator on what “good” and “good enough” look like.

If I compare what has happened in other sectors that have been through similar processes of having both to step up after disasters and to change their processes and systems, the difference between this sector and other sectors, such as oil and gas or aviation—whichever one you want to look at—is that all of them stepped up more readily and recognised the need for them to be part of the solution. It has taken us far too long to get there with the built environment sector. It is there now because it is feeling the crunch. It deserves credit for that. It is also fair to say that it is not the case that all of the actors in that system have been laggards; there have been some good ones, but not enough by any means.

Lord Best: You recommended an overarching approved document that would cover the whole scene. Do you think that the BSR’s review of approved documents is going in the right direction? Is that going to get to your recommendation being fulfilled?

Dame Judith Hackitt: I certainly hope so; that is the intent. What I meant by that when I said it, and what I hope will come out of this review, are the abilities to look at buildings in a holistic way; to consider fire safety, structural safety, energy efficiency and all of those things; to recognise that all of those things interact in how a building is designed and put together; and to ensure that we meet all requirements, rather than focusing on one at the expense of the other.

Q66 Lord Gilbert of Panteg: Before I get into my questions, can I pick up on Lord Best’s question? You said that you are disappointed at the time it has taken the sector to understand its role; you compared it with, for example, the aviation sector. Why do you think that is? Is it a larger, more disparate sector that cannot move as effectively as, say, the aviation sector can? Is it the nature of the businesses and the people who run them? What do you put it down to?

Dame Judith Hackitt: I think that it is both of those things. There is no doubt that the disparate nature of the industry, with its many different players, makes it challenging to bring the right players together to achieve some of those things. That is undoubtedly part of it.

However, there is no shortage of collective leadership in the form of different industry groups, which—to their credit, I think—have put in a lot of work in trying to help define those standards and so on. Where we have seen some reluctance is in the take-up. I would refer to competence as a particular example of that. For seven years now, we have been talking about the need to raise the levels of competence across the whole sector. Huge amounts of work were done by a range of different actors within that system to come up with a fully comprehensive competence framework for the whole industry. The frustration has been with the slowness of the take-up of the training that is needed to raise the levels of competence.

Lord Gilbert of Panteg: That is helpful. We have spoken to a lot of people in the industry. One of the things they have called for is better communication, engagement and feedback from the Building Safety Regulator and its multidisciplinary teams. Do you think that that is fair? Do you think that there should be greater communication and greater effort to improve understanding and common working, or does this bring a bit of a risk of regulatory capture? Is there merit in a bit of remoteness between the regulator and the industry?

Dame Judith Hackitt: I will answer the first question first. Should there be more communication and engagement with industry? Absolutely.

Do I think that that carries a risk of regulatory capture? No, because we should all start from the premise that there are people out there who want to do the right thing. If they need help and guidance to do that, it is the regulator’s role to step in, provide that clarity and help them resolve those issues. As I said, a lot of that is now going on. It should have been happening a lot earlier, in my view. I do not think that that gets in the way of the regulator taking the role it needs to take in enforcement action, as and when it is necessary, against those who are reluctant to step up and comply with the requirements.

Lord Gilbert of Panteg: Picking up on that, you have not been wholly critical but you have been critical of the industry. Does the industry have a role in improving communication? Does the Building Safety Regulator need to get its act together, focus on this and spend more time communicating effectively, or does the industry have a bit of a role in improving communication?

Dame Judith Hackitt: The industry has a huge role to play in that—and a very important one. The people we keep forgetting in all of this are those who lie at the heart of why we are doing this. Let us not forget what I found eight years ago and what the public inquiry found and reported on less than a year ago. The practices in this industry are shocking. They were shocking in 2017. Some of that has changed; some has not.

The victims in all of this are the 72 people who died at Grenfell and the thousands of people who, after Grenfell, were left, in unsafe buildings, feeling very anxious about the quality of the properties that they were living in. It has cost the public purse millions to put that right. We are trying to draw a line in the sand and stop this happening ever again; that requires everyone to step up and play their part.

Lord Gilbert of Panteg: Specifically on communication, I have spoken about the complaints from industry. In particular, it complains about multidisciplinary teams. It claims that they sometimes give inconsistent feedback and that different multidisciplinary teams on a project conflict slightly with each other. Is that a fair observation? Is it being dealt with?

Dame Judith Hackitt: In some ways, that is almost bound to happen in the early stages of a process such as this, where teams are looking at buildings. Some of that may have to do with the fact that similar buildings may be used for different purposes. The occupants may have a very different profile. There may be reasons why different interpretations and conclusions are drawn about what look immediately like very similar buildings but are being put to different purposes; there may be reasons for that inconsistency. Is that being monitored and looked at by the regulator? Yes; it is an important part of the work that it is doing in moving from what I would call the start-up phase of this very different regime into what will become business as usual, which needs to be much slicker and much more consistent and, certainly, needs to speed up from where we are now.

The Chair: When you mention occupants having different profiles, are you talking about the difference between residential and commercial, or are you talking about residential but different types of occupancy?

Dame Judith Hackitt: I am talking about the different profiles of the intended occupants of a building, whether a building is being built for sheltered housing, being built for a very different group of occupants or being sold for leasehold. Those things will make a difference because we now have a requirement to look at the risk profile of who will live there and the number of occupants. Is it envisaged that there will be a high level of people in that building requiring assistance in the event of an emergency? Those are the sorts of questions that we expect people to think about when they design and build the buildings so that we can be satisfied that, in the event of an emergency, they can be evacuated safely.

Q67 Viscount Chandos: I want to go back to the reasonable expectations around the speed of change. At the same time as comparing this industry unfavourably with others, you said that it is now early days. You said just a moment ago that some practitioners had improved but others had not. What was your expectation, when you completed your review, as to how quickly the culture change and the change in practice would occur?

Dame Judith Hackitt: I anticipated that it would take years. In my head, my view was that it was going to take in the order of five to six years to implement it. It has taken far longer than that to get to the point of critical movement, but we are there now. It is taking longer than I anticipated, but we have to recognise where we are and continue to move forward. What I fear most at this stage is that we will go backwards; that would be a travesty, in my view.

The Chair: What causes that concern? Why do you think we might go backwards?

Dame Judith Hackitt: What I see and hear is industry making a big deal of the delays that are currently taking place at Gateway 2. I recognise those, but I also recognise that industry plays a part in creating those delays just as much as some of that responsibility lies with the regulator.

I have seen—I have talked to the regulator at length about this—the quality of some of the applications that it is receiving at Gateway 2 and some of the problems that it is dealing with. Although I acknowledge that there is more we can do in terms of guidance, some of the things that it is not seeing at that stage and some of the reasons why it is rejecting those applications are pretty basic stuff that any one of us, I think, would expect the people submitting those applications to be able to provide. It is already very clear that it is a requirement to provide it.

Q68 Baroness Nichols of Selby: It might be too early to ask this because, obviously, this is something new. Have you seen any of the impact of the new Building Safety Act and the responsibilities on accountable people and duty holders? Do you think that it has had any impact already on the safety of buildings and the behaviour of developers and those who own and manage buildings?

Dame Judith Hackitt: Yes, undoubtedly; I have seen evidence of that myself.

As I said, there are some very good actors out there. We do not give them enough credit or recognition for what they are doing. Only last week, I was in the north-west with a company that specialises in the refurbishment of high-rise buildings. It had an extraordinary story to tell about how it has changed its processes and practises to meet the requirements of the Building Safety Act. Yes, it also told me about the delays it had suffered at Gateway 2, but it was gracious enough to admit that it learned a great deal from its interaction with the regulator during that delay period. It now knows how to approach things differently going forward, and will do so. It regards this as unfortunate but an important learning exercise in how to handle the application better.

I then went on a site visit and saw what it actually does in practice. Now that it has put much better preparation into the whole refurbishment programme, it is truly outstanding; it is, I think, an exemplar of what we are looking for and expect from people operating in this sector.

Baroness Nichols of Selby: It seems like the teething problems may have been around communication and maybe on both things, but it seems that some developers are taking to it much better than others.

Dame Judith Hackitt: That is absolutely true. As I said, the Industry Safety Steering Group has been in place for seven years now. We have invited numerous actors from throughout this sector to come and give evidence to us over that period. We have seen some exemplary housing associations that have taken their role seriously and have grasped the issues of how to assess all of their buildings that are already in occupation and of what to do. We have seen really good examples of some people at the development stage. We have seen people thinking differently about the types of contract they need to have in place. However, there just is not enough of it. We need to see that level of consistency across the industry, just as much as we need to see consistency in the way regulation is applied.

Q69 Lord Teverson: Can I follow up on a couple of things that came out of Baroness Nichols’ question? Put me right: is it the case that you can now point to a duty holder on all high-rise residential buildings that are being refurbished? Also, do all existing high-rise residential buildings now have accountable persons? Are they registered?

Dame Judith Hackitt: Yes. They are all registered, and those existing buildings in occupation are being called off in a priority list to apply for their building assessment certificates from the Building Safety Regulator.

Lord Teverson: Excellent; that sounds like good news to me. One of the other bits of your report, which we have not discussed, is the idea of a golden thread and a digital record throughout the life cycle of a building. It seems obvious to me that there should be one in order to maintain some sort of safety over the life of a building. Regulations were then put in place, I think. Is that all working now? It seems quite a challenge—I do not know.

Dame Judith Hackitt: It is in its infancy. Is it important? Absolutely. It is crucial. How can anyone who is managing that building in occupation do so unless they know what they started with and they have assurance that the building was built in accordance with the design? They need all of that to be able to tell people what they can do from thereon.

Lord Teverson: And any modifications thereafter, presumably.

Dame Judith Hackitt: I do not think that any one of us would buy a car if the dealer told us that they could not tell us what parts went into it and they could not give us any guarantee at all of how it would function in practice. We would walk away. For every single one of those properties in high-rise buildings, that is the case. That golden thread—that package of information so that you can manage a complex system, which is what the building is—has not been there until now.

Lord Teverson: Who holds that? If the business that is in charge of or owns the building goes bankrupt or passes it on, is it on a piece of software? Is it somewhere in the cloud? What is it?

Dame Judith Hackitt: As is often the case when something new like this arises, many different options emerge as people see opportunities to provide the solution to the problem. When I say that it is in its infancy, that is what I mean. We are currently seeing many different options being purveyed as to what the golden thread might need to look like. Again, this is where the regulator has an important role to play in saying, “This is what it needs to contain”, and in being clear so that people do not end up buying some package that is over the top, not suitable and not good enough for the purpose we want to put it to. It seems pretty obvious that, in 2025, it should be in a digital form. I would hate to see this emerge in the form of reams of documents; that would seem rather strange.

Q70 Lord Teverson: Exactly. I was going to ask about the problems at Gateway 2, but you have already answered that in terms of it being a joint issue for both the industry and the regulator. So I come back to culture.

As we have said in this committee before, changing culture in any organisation, let alone a sector, is an amazing challenge, as we know. Can you describe the culture as you found it when you started your report? Describe what that culture was, then say, perhaps, how much it has changed. What did you find? What shocked you?

Dame Judith Hackitt: How long have we got? I have said this many times.

The first shock to me was when I started to talk to people in the industry and asked, “How do you think this has happened?” Remember, I am not talking about just Grenfell here; I am talking about the fact that, a month after Grenfell, we knew that we had lots of other high-rise buildings. The first thing is that we did not even know how many high-rise buildings we had; we did not know how many there were. Then, when we asked questions about how many of them had the same sort of cladding, there was no idea. So it all goes back to the golden thread.

Then you start to ask people questions about how they think we got here. People in the industry, in those weeks immediately after the tragedy, were open and honest with me. They said, “We knew this system was broken. We knew it wasn’t working. We didn’t think it would ever result in anything this bad”. Then, when I asked, “Why did you not speak up?”, some said that they tried and others said, “It wasn’t my job”. For me, that raises all sorts of questions around professionalism and ethics and the fact that some of those people call themselves engineers. I am an engineer. I know what my code of conduct is and what I have signed up to. The fact that they see no reason or justification for them to stick their head above the parapet when things are not as they should be was shocking to me.

Then you ask questions of people such as, “Who ensures that the building is built to design?” They say, “Well, we do the design as we build it. That is what design and build contracts are all about, right? You design and build in parallel”. This is where some of the friction around Gateway 2 is coming from: the industry is not ready, at the point when it has to apply for Gateway 2 with sufficient design detail, to answer the questions that are being asked. You then ask, “How does change get recorded so that, as you make changes as you go, we know what we end up with?” There is no system in place. That was what I found, and that is what shocked me.

Lord Teverson: So, we are partly through a cultural change there, and some of that has been—

Dame Judith Hackitt: Some of that is causing the friction. Design and build contracts are a fundamental problem in getting through the Gateway 2 problem. That is why industry and the regulator are now discussing a staged approval process, which will help ease the process of having to have everything designed before Gateway 2. We might end up with a Gateway 1.5 or 2.5 process as the building is designed and built in stages.

Lord Teverson: Does the legislation allow for that flexibility?

Dame Judith Hackitt: There is room for the regulator to allow that to happen, but leaving it all to Gateway 3 is simply out of the question; that would be absolutely nonsensical. The cost of fixing things when the building is complete immediately before occupation makes that a no-go option for me.

Q71 Lord Gilbert of Panteg: Can I briefly come back to the golden thread? I challenged a previous witness about how AI could improve the efficiency of the regulator and other bodies. They said, “The problem is that it is not really digitised. You cannot apply AI unless you are fundamentally digitised, and it is not digitised”.

Dame Judith Hackitt: Yes.

Lord Gilbert of Panteg: The analogue nature across the sector seems quite a substantial issue. Is there a need for, as well as everything else that is happening, a real digital transformation programme on top of and separate to all of the things that you are talking about?

Dame Judith Hackitt: Yes; I think that there is a need for that. The opportunity for that will be created through the construction products regulation when it comes, because that is where all that needs to start.

Q72 Viscount Trenchard: Dame Judith, I want to ask you what you think about the current suggestion by the BSR that it should issue notices on an organisation-by-organisation basis, rather than the current system of going building by building. What are the arguments in favour of and against this move? Would you support it? Do you think that it is a good idea or do you think that, if the issuance of notices were changed to an organisation-by-organisation basis, it would lessen the BSR’s focus on local conditions and the safety of individual buildings?

Dame Judith Hackitt: As we work our way through this process, it is very welcome that the regulator is coming forward with ideas on how to improve the process. It should be doing that as it learns by how it goes. It is really important that we try to innovate in how we carry out the required regulation and set the required standards.

Are there merits in looking at buildings organisation by organisation? Yes—particularly in occupation. You asked me earlier about inconsistency in different multidisciplinary teams. Think about housing associations: they have numerous buildings within their responsibility. Tens—hundreds, in some cases—of high-rise buildings are in their remit. They, as organisations, must make decisions about prioritising the spend of money over several years if they are to maintain and improve those buildings. Having a conversation with the regulator at an organisational level on how they do that prioritisation, what needs to be done first in which buildings and how that programme will pan out over a number of years makes eminent sense to me, rather than them being faced with multiple work lists that they then must try to prioritise based on individual building assessments.

Q73 Viscount Thurso: I want to ask you about the Gateway process and the relationship between Gateway 3 and Gateway 2. I will put that into two different questions, because the second part is really a follow-up to the question that Lord Teverson asked you.

First, in looking at the system as it is, without any particular changes to the Gateways, are there efficiencies that could take place to help create a smoother operation between industry and the regulator? I am thinking of things such as grouping Gateway applications for similar buildings or removing some of the smaller, less safety-critical renovations. Do you have any thoughts about how the efficiency might be improved in the process?

Dame Judith Hackitt: I have lots. Let me start by describing Gateways 1, 2 and 3 in non-technical terms. Gateway 1 says, “Tell me what you plan to build”. Gateway 2 says, “Show me the design of what you plan to build, and show me that you have put thought into the fire safety and structural safety of this building”. Gateway 3 says, “Now demonstrate to me that you have built what you said you were going to build and that it is safe for occupation. If you have changed it at all between 2 and 3, explain why and explain how it is still a safe building”. It is that simple. Those are not unreasonable questions to pose to the industry at those Gateway points.

Are there ways of improving that process? Yes. Some of the people I talk to in the industry have already said to me that the existence of Gateway 2 now means that they engage only in projects where there is a two-stage bidding process, so that much of that design work is done up front before the final contract is let; in my view, that is exactly the way things need to change in order to accommodate Gateway 2.

Of course, there are others who want to retain the same design and build contract system as always. Einstein tells us very clearly that, if you keep doing the same thing, you will not get a different outcome. We want a different outcome, so applying some of these staged approvals processes is a pragmatic way of trying to ease that process. Fundamentally, though, we are expecting more design work to be done up front; that will result in less change and, in my view, more efficient build when you get into the construction phase. That is one thing.

Viscount Thurso: Can I pick up a bit of what you said there? I have never done any big contracts but, when I was in the hotel business, we used to do some fairly big renovations. My memory is that we usually picked the person with the lowest price; 90% of the work was provisional sums and not designed. What we are really saying here is that you need a two-stage contracting process where you get to a couple of potential preferred bidders—two or three—and, at that point, you pay them sufficiently to give you a detailed design for comparison, rather than the old way where you pay nobody, take the lowest price then discover later on that it was wrong.

Dame Judith Hackitt: Yes. There is another thing that we need to change in the longer term; I am not suggesting that this will happen overnight. Look at what many other industry sectors do: they consider the life cycle costs of projects rather than the upfront costs of build. The problems that come later are somebody else’s problems. If we were able to consider life cycle cost, spending more money up front would make eminent sense because it would reduce costs later in the process.

Viscount Thurso: The key thing—the trigger that you have pulled in my tiny brain—is the fact that a key element of all of this are the people letting the contracts right at the beginning, as much as the design and construction industry that is delivering.

Dame Judith Hackitt: Yes.

Q74 Viscount Thurso: We have had a lot of evidence from the developer side saying, “Look, bits at Gateway 2 really ought to be in Gateway 3 or this or that”. What I have heard already from you today is, “No, they’re missing the point”. Do you think that there is anything in those comments? Are there things that you would look at and say, “As long as A, B and C have been properly done at 2, some of the other bits could come through at 3?”, or is how you have set out 1, 2 and 3 such a straightforward principle that there is no room for movement?

Dame Judith Hackitt: I do not think that we can be hard and fast about this because, as I said, we are learning as we go. When I speak to the regulator about the conversations that are now going on around this staged process, we are getting to exactly that: if there is real justification for why some things cannot be ready at Gateway 2, there can be some form of conditional approval, provided that the answers to those outstanding questions are brought back to the regulator for approval in a timely fashion. That means before Gateway 3, because Gateway 3 is at the point of completion of the project and, by then, it is too late.

Viscount Thurso: So there is almost a sort of 2a and a 2b?

The Chair: Or a 1a and a 1b.

Viscount Thurso: Yes. I was struck by your comments, following the chair’s opening question, on the fact that people are now feeling the crunch but a much better relationship is developing: the two sides are starting to talk to each other and the better players have learned, as you described in your example. Do you think that this is just something that we will work through? Do you think that the regulator will come to a view on what is needed and not needed and the industry will understand and learn to live with that?

Dame Judith Hackitt: Yes, I do. That is exactly what is happening. We need to cut through the noise because there is a lot of noise being made by a lot of people about this. I wish you could see some of the information that I have seen from the regulator on what it is dealing with. My honest view is that the regulator has not done a good job of defending itself and of presenting its case on just how poor some of these applications have been. I do not mean that in the sense of bringing this into some form of battle; it is about getting the evidence on the table so that we can all see just how challenging some of these things are.

What is certainly happening now, I think, is that those conversations are happening on a very frequent basis and are being overseen by the building industry oversight board in the MHCLG. We have on the table now not only a list of what the Government and regulators need to do to get us to where we need to be but, at long last, a commitment from industry on what it needs to do to play its part. That has been a long time coming.

The Chair: You said that you support the changes the Government announced a couple of weeks ago.

Dame Judith Hackitt: Yes.

The Chair: Good.

Dame Judith Hackitt: It was always anticipated that there would be a review after five years and that it may move out of HSE into a different place. The fact that that has come slightly early as a way of addressing some of these issues, and as part of this move towards a more consolidated regulatory framework, seems eminently sensible given the conversations that are going on.

Q75 Viscount Chandos: There has also been quite a lot of noise about the resourcing of the BSR. Do you think that it is adequately resourced? If not, should we look to the industry to stump up, or should it be the public purse that covers that cost?

Dame Judith Hackitt: I start from the point that it is for industry to pay the cost, because that then provides the incentive for industry to help itself to get to a point where it needs less regulatory attention; it creates an incentive for good practice. There are many more things that we could do to create an incentive for good practice, but that is one of them.

Viscount Chandos: We have had witnesses who have argued that it is just not going to happen unless it is publicly funded. You are less pessimistic than the industry and think that, if pushed, the industry will come up with the funds. Of course, then there is the question of whether the cost just gets passed on to the tenants and the leaseholders. Is it absorbed, at least to some extent, by the developers?

Dame Judith Hackitt: Is it not important that we focus on, “What problem are we trying to solve here?”? The problem that we are trying to solve here is poor-quality buildings being built and putting people’s lives at risk because of the poor quality of the build. This tells me that the people who need to pay for the regulation of that are those who are responsible for those poor practices, in order to incentivise their improvement. I have consistently said that it is grossly unfair for those costs to be passed on to residents. One of the most awful fallouts of this whole tragedy has been the way in which leaseholders have been hit with bills for the remediation of buildings when the problem was not their fault. When that happens and you have a legacy problem, as we discovered after Grenfell, the Government stepping in and providing a backstop is almost inevitable, but what we are trying to avoid is that happening again.

Viscount Chandos: Yes. It is, I would suggest, a microcosm of the broader issue that, in the economy, there needs to be better resilience.

Dame Judith Hackitt: Yes.

Viscount Chandos: However, the evidence is that the companies pass the costs of any increased resilience on to consumers. It is about the relative power of those companies and their customers, tenants or whatever. Is there a way of trying to break that in this case?

Dame Judith Hackitt: I am not part of this industry; I value my independence from it in some of the observations that I am able to make. Having said that, going back to what I said earlier, I am quite disappointed that the industry has not seen this as an opportunity to modernise its practices, whether that is digitisation or thinking differently about the whole process of building.

The current model of design and build results in very high levels of waste in terms of the materials used on projects. You asked me earlier about whether there are ways to make efficiencies in this system. I do not understand why there are not more standardised designs of buildings in use in this sector because, if you design it and get it approved once then build it many times, it not only removes all the delays in the approval process: building the competence of the people who do the building and being able to order the materials without waste and without the rejection of substandard materials would all improve in a process of more standardised building.

Viscount Chandos: I guess I still do not quite see how you could put a buffer between the developers and the continuing owners of the buildings and the residents to protect them from excessive increases in costs.

Dame Judith Hackitt: In existing buildings, it is a challenge, of course. As any of us who are homeowners know, when you have been in a building for several years, what is a defect from original build and what is wear and tear from the building being in use? Those things become blurred as time passes in existing buildings—I acknowledge that—and it becomes more and more difficult to make that differentiation.

Q76 Baroness Harding of Winscombe: The Government set out plans to increase the staffing of the BSR and for the regulator to retain greater expertise in-house, rather than contracting in experts only as part of establishing multidisciplinary teams. Do you think that there are sufficient numbers of skilled staff available to allow the BSR to recruit this expertise in-house? Is it going to need to increase salaries significantly to do that or to expand investment in training to make that possible?

Dame Judith Hackitt: We have a skills shortage across the whole of the piece—of that there is no doubt—whether that is in recruiting people to act as regulators or recruiting people to work with industry, on the industry side of the fence, in getting the design and build right in the first place. We have a competence crisis in this sector. The frameworks are all there, as I said; the people who have done the work on them have done a tremendous job. However, it is not just about technical competence. I also have real concerns around needing to get behaviours and attitudes right so that people behave responsibly and speak up when things are wrong, whether that is in what they have seen of someone else’s work or whatever. We need all of those things to form real competence among the people in this sector. Only when we do that and increase the pool will it become easy for the regulator to recruit people; of course, public sector salaries do not make that any easier.

Baroness Harding of Winscombe: What policy interventions should the Government be considering to expand the skill set?

Dame Judith Hackitt: First, we need to ask for greater proof of competence from the people who are being engaged in the projects. There is a lot of reference to that in the Act, and some of those things are also biting during the setting in of this process. The Government should do a full and thorough review of the professions involved; what they are doing to increase the level of competence in the existing pool of professionals; what that competence really means and looks like; and what they are doing to attract more people into those professions.

Baroness Harding of Winscombe: What is your view on internal versus external expertise in the BSR? Is it right to bring all the resource in-house, or should you retain some external expertise in MDTs? What is the right balance?

Dame Judith Hackitt: My experience from many years of being in the private sector is that it is all about the difference between peaks and troughs in the workload. Any organisation should plan its resources on the basis of its base, business-as-usual level of work when it is in normal business mode; the BSR is not there yet because it is still in that start-up peak. From then on, bringing in people from outside should be for lopping the peaks. Having the people in-house leads to greater consistency and builds the body of knowledge that you need in a competent regulator.

Q77 Lord Gilbert of Panteg: Can we turn for a moment to what I regard as lower-risk buildings? The focus has been on how the BSR’s focus has been on high-risk, tall buildings. Has there been enough focus on low-rise and medium-rise buildings? Has the risk of those buildings been properly assessed and understood, or is this something still to be turned to?

Dame Judith Hackitt: There is more work to do on low-rise and medium-rise buildings of multiple occupancy. However, it was always the case—these decisions are never easy—that decisions about prioritising had to be made. We can see now how difficult it is for the regulator and the industry to get their heads around addressing high-rise, multiple-occupancy buildings and changing those practices. There are many things written into the Act that apply across the whole of the built environment sector and for which there are mechanisms in place to check in due course how well those thing are working, but it was always the intention that this should not be just about high-rise buildings and that, in due course, when the capacity was there, it should move on to the next tranche of high-rise and medium-rise buildings.

Lord Gilbert of Panteg: You have told us that a key factor in assessing the risk is who the occupants of the building are going to be.

Dame Judith Hackitt: Yes.

Lord Gilbert of Panteg: It is not just about the height; it is about who the occupants are.

Dame Judith Hackitt: Right.

Lord Gilbert of Panteg: You could have a low-rise or medium-rise building with a high-risk set of occupants.

Dame Judith Hackitt: Indeed.

Lord Gilbert of Panteg: You could also have a high-rise building with a relatively low-risk set of occupants, depending on their tenure and the purpose of the building. Is there a process to identify low-rise and medium-rise buildings that are high-risk buildings for other reasons, such as occupancy?

Dame Judith Hackitt: My understanding is that the Building Safety Regulator is already looking at that and looking at what the next extensions in scope will be.

Lord Gilbert of Panteg: Just touching on that, what impact has the regulation of building control authorities and inspectors had? Is that fully bedded in? Do you feel not only that the cultural relationship is right but that there is proper oversight of what building inspectors are doing as a profession?

Dame Judith Hackitt: I will be able to answer those questions more fully when our independent panel has completed its work, because that is at the heart of what we are looking at. Having said that, the fact that the Building Safety Regulator now has oversight of all building control—in both the public and private sectors—is a major step in the right direction. The fact that you cannot choose which building control to use for high-rise buildings is also embedded in the new system. Those are all steps in the right direction.

However, from the work that we have done on the panel so far, it is already clear that this is yet another complex, interactive picture that will need to be unpicked and understood before we can make further recommendations. There is clear evidence of good practice in the private sector in building control and in local authority building control, but there is also evidence in both of where practices still need to change.

Lord Gilbert of Panteg: In local authorities as much as in the private sector?

Dame Judith Hackitt: Yes.

Lord Gilbert of Panteg: That is interesting. Basically, your critique of the construction sector is that it is extremely variable and there was lots of good practice but also lots of really bad practice. The same critique applies to building control.

Dame Judith Hackitt: Yes; it is mixed and not simple. It would be easy for us all, would it not, if we were able to say, “The good practice is all in this bit and the bad practice is over there”. It is not like that. It is mixed across public and private in building control.

Lord Gilbert of Panteg: It seems to me that it is driven by culture as much as by anything else.

Dame Judith Hackitt: Again, available resource levels are at the heart of a lot of this. We have already found that some people operating in the private sector are overseeing a staggering number of new builds all at the same time, which leads me to question how they can possibly have oversight of that many buildings.

Lord Gilbert of Panteg: I do not think that that applies to just this area. There is huge variation in quality across local authorities and their many functions; we have seen a number of examples of that. Do you have an understanding of the difference between a good local authority building control operation and a bad one?

Dame Judith Hackitt: We are building that picture. I would not like to make any assumptions at this stage but I would be happy to come and report back when we are further on in the process of gathering our evidence, because that is fundamental to what we are trying to look at in terms of what makes for good building control.

The Chair: It might be helpful if we could have an indication of the direction of travel there.

Dame Judith Hackitt: I will ensure that copies of both the problem statement, which is imminent, and the questions that we are asking as part of the consultation process are issued directly to all of the members of this committee. We will keep you informed as things progress.

The Chair: That would be helpful; thank you.

Q78 Lord Best: I think that the public at large would be very surprised to discover that the regulation of construction products is not part of the role of the Building Safety Regulator. You would think that the two would go very much hand in hand. One of our witnesses said that 90% of the problem of safety was to do with the regulation of construction products but, at the moment, the two are separate: we have the Office for Product Safety and Standards and, within that, the national regulator for construction products. Do you think that the relationship between these bodies is going well in terms of co-ordination and working together? Do you think that that relationship is going to change as we work towards what the Government have said they want by 2028: a single construction regulator, which you recommended the first time around? How is it going so far, and will it change significantly in the near future?

Dame Judith Hackitt: There is plenty of evidence of good collaboration between the construction products regulators set up under the OPSS and the BSR. They talk regularly; they are working well together and have been doing so from the outset. The challenge thus far has been that it was only when the Green Paper was published, at the same time as the public inquiry, that we had a proposal on the table for what the construction products regulation needs to look like and how that should be improved.

In my view, the two regulatory frameworks are very different. They have to work well together and to interlock properly, but they are doing two different types of regulation. One is around a different part of the industry: the people who provide the products. How those products are tested and so on is a very different form of regulation from regulating the construction process. It involves different players. There is no doubt at all that they need to work well together.

I see the single-regulator vision, if you will, as being all about a single coherent regulatory framework that may, under some overarching body, still have two separate teams of regulators that work extremely well together.

Lord Best: That is where you feel it is headed at the moment.

Dame Judith Hackitt: That would be my preferred model because the two need to be established and functioning well separately first; only when that is the case can you then look at the merits of bringing them together because, at this point, the complexities in both are such that they need dedicated effort and attention on both sides of that regulatory framework. Then you can think about bringing them more closely together under an overarching body—but there is nothing to stop you having that overarching body in place from the outset to ensure good collaboration and division of responsibilities.

Lord Best: You have impressed on us that things are going a bit better and going in the right direction, with better communications, better understanding and more good practice. Is this the time for another reorganisation of the structures framework, or would that disturb what is progressing in the right direction?

Dame Judith Hackitt: There is a real risk of it being a distraction at this point; we have to work hard to avoid that, which is why holding our nerve and sticking to what we have decided to do, which we all supported and all saw the need for, is really important at this stage. It will get better—it is getting better. The commitment to making that happen is there from the regulators, and we are making progress in getting the industry to recognise the part that it needs to play in this.

Q79 Viscount Chandos: Your fear that things could go backwards rather than continuing on the path of improvement has to be seen in the context of both this sector’s target of 1.5 million new homes in this Parliament and the broader talk about regulators needing to prioritise growth. This is not a unique issue for the UK; other countries have the same challenges in balancing growth, supply and affordability with safety. What is your view? Are there countries and jurisdictions that have got it right and have it better than the UK? What could we learn from them?

Dame Judith Hackitt: It is really important in any part of this that we look at and take stock of what happens elsewhere in the world.

One of the things that we have done on building control, in our first month or so of operation, is exactly that: we have looked at how building control is done elsewhere in the world. Some of the results have surprised us, not least the fact that we are far from being unique in having a mixed public-private model. Just about every other country in the world has that, but they have some interesting safeguards in place to avoid conflicts of interest; we could learn from those. We should always try to learn from others in terms of good practice.

Over the past six years, I have had the privilege of being involved in similar conversations about the regulatory frameworks in Australia, which has similar problems and challenges to us. Some very good and innovative ideas are now emerging. We should take a close look at them, not least the building trustworthy index scheme that is being piloted in New South Wales. It is a scheme whereby, aside from the regulator—in fact, the regulator uses the system—there is an independent means of assessment throughout the build of a project using organisations that meet certain criteria. Through being able to provide assurance of the materials used, you then arrive at a finished product—the building—which has a certain trustworthy rating. The rating can then be used by regulators, insurers and consumers to assess the safety and quality of those buildings.

It seems to me that a system such as that, in support of the new regulatory regime that we have, would be extremely beneficial to a lot of people and would provide the sort of incentives that I think we need in order to recognise the good players out there who are already doing the right thing and who, at this point, get no recognition for that versus those who are dragging their feet.

Viscount Chandos: The adoption of more standardisation and, as it were, pre-construction is at the heart of that. Is that right?

Dame Judith Hackitt: It is a part of it but it is not the whole. The system that has been adopted in New South Wales is very much about assessing the companies doing the construction and assuring the quality of the products, which is exactly where we are. They are the same things that we are grappling with, and they have both been built into that building trustworthy index.

Q80 Viscount Thurso: I want quickly to pick that point up with a subsidiary question. You mentioned insurance. Are we on a trajectory where this becomes an insurable risk, because of the quality of construction and the regulated process; where the insurance industry can offer something; and where the insurance industry is who pays for it when it goes wrong? In that case, should it be a statutory insurance, rather like public liability, employer liability and so on?

Dame Judith Hackitt: One of the big issues that we have wrestled with—we have seen it ripple throughout the whole process on the Industry Safety Steering Group—came up once we realised the extent of the problem that we were dealing with. I described earlier my surprise at just how much a race to the bottom had pervaded the whole of the system here. I was not the only one who was surprised by that. The insurance industry was undoubtedly spooked by what we saw and what we found in the aftermath of Grenfell. When we talk about rebuilding confidence in the built environment, the residents are at the heart of it but, in my view, the insurers and financiers of the built environment follow very closely behind. I think that they will come back to the table when they can see that there are reasons to be confident that things have changed.

Q81 Lord Teverson: I shall ask this very quickly. Even the Government admits that the target of 1.5 million houses or residential units in this Parliament is a challenge. Do you feel that the BSR will come under political pressure as that perhaps becomes more difficult, as Parliament continues and memories fade? Will there be political pressure on the regulator, and will the regulator be strong enough to resist it?

Dame Judith Hackitt: I think that the regulator needs to be bolder in defending itself, first of all. Secondly, I think that we all need to be careful what we blame it for. My understanding is that, out of that 1.5 million, the number of proposed buildings—I do not mean whole buildings; I mean dwellings—that are being held up in the Gateway 2 process is currently around 30,000. Can the regulator be held to account, if it does not make any progress, for delaying the build of those 30,000 buildings? Yes. Can we blame the regulator for the whole 1.5 million if we do not meet the target? Absolutely not, because there are other factors at play.

Lord Teverson: I do not know that it is necessarily always as logical as that.

Dame Judith Hackitt: We need to look at all of the factors that influence the rate of build and not just pick on the one that is in the frame at the moment, which is clearly building safety.

Lord Teverson: I take that point.

The Chair: Then you get into all sorts of other areas that you have touched on, such as skills, which we have mentioned but did not go into in any depth.

Dame Judith Hackitt: Market confidence, insurance, mortgage availability—all of those things have an impact.

The Chair: Dame Judith, thank you very much for the time you have given us this morning and for your thoughts. You have reinforced a little of what we are thinking—particularly in terms of a staged approach in the Gateways, because that is something we have been hearing about as a possibility. Your experience has clearly been very comprehensive. Thank you very much for your time.

Dame Judith Hackitt: I will keep you informed on the building control work as well.

The Chair That would be very much appreciated; thank you.