Written evidence submitted by Places for People [BSB 290]

About Places for People

Places for People is an award-winning placemaking and regeneration company, with over 50 years of experience creating places that work for everyone. With a long-term commitment to the sustainability of places, we have the capability and expertise to create and manage entire places. We currently own or manage over 200,000 homes across the UK, providing valued services to more than half a million people each year. In 2019/20 we built and acquired 2,680 new homes and have plans to deliver a further 18,000 new homes in the coming years.

Our Group companies are market leaders in their fields, providing relevant and high quality services to our customers at every stage of their lives, from students to first-time buyers, through to retirement. By taking a commercial approach to sustainable placemaking, we also deliver a strong and positive impact on our communities. Through our active asset management and investment strategy, we maintain a well-managed and profitable portfolio, which has enabled us to withstand short-term shocks in the economy and build our capability to deliver our long-term strategy. We invest in quality developments that will stand the test of time. Our purpose is to create places that work for everyone – this sums up our long-term ambition to change the way places are designed, built and managed to create housing choices that improve the lives of the people who live there.

Our portfolio of complementary companies has found creative ways to collaborate to tackle the big issues affecting the sector, and create places and assets in a way that few organisations can match. We work with partners and local communities to inspire the creation of places that offer opportunity and choice for people that live and work there. Across the Places for People Group, we put people first. We treat everybody honestly, courteously and fairly. The Group works with a broad range of customers and clients and applies a unique mix of skills and capabilities to meet and exceed their needs.

PLACES FOR PEOPLE GROUP RESPONSE

1. Introduction

We welcome the focus of the draft Building Safety Bill and think it will bring certainty and improve the long-term safety of residents.

2. Building Safety Bill

We welcome the opportunity to provide our response to the government’s Draft Building Safety Bill. As requested in the consultation brief, we have focused in on the key areas of the Bill in the sections below, and where applicable, provided comments in line with the questions set out in the consultation brief. These are:

• How well does the Bill, as drafted, meet the Government’s own policy intentions?
• Does the draft Bill establish an appropriate scope for the new regulatory system?
• Will the Bill provide for a robust – and realistic – system of accountability for those responsible for building safety? Are the sanctions on those who do not meet their responsibilities strong enough?
• Will the Bill provide strong mechanisms to ensure residents are listened to when they have concerns about their building’s safety?
• Is the Government right to propose a new Building Safety Charge? Does the bill introduce sufficient protections to ensure that leaseholders do not face excessive charges and that their funds are properly managed?
• Does the Bill improve the product testing regime in a way that will command the full confidence of the sector?
• Is it right that the new Building Safety Regulator be established under the Health and Safety Executive, and how should it be funded?
• Does the Bill present an opportunity to address other building safety issues, such as requirements for sprinkler systems?

Looking at the Bill as a whole, we think further guidance is needed to allow the sector to understand the implementation period and timescales involved.  In particular we think there is a need for clear guidance on an implementation timetable and an associated transition period. On the assumption that this will not be retrospectively introduced and is introduced through Building Regulations, there will be a period when developers will not be able to accurately cost their schemes, which could reduce the values of sites from both a planning and cost perspective if there is no transition period. This will be an issue for the sector as a whole and therefore needs to be addressed. Similarly, it would be helpful to provide a clearer indication of the transitional arrangements for existing buildings.  Further clarity is needed on the timescale for bringing existing buildings under the remit of the Act, taking account of the sector capacity issues we raise later in this response (section 2.3).

Whilst we welcome the changes proposed in the Draft Bill to improve the safety of residents in their homes, we think it should be acknowledged that the contents of the Bill hinges on the assumption that buildings are well managed, maintained and in good condition on the outset. However, the reality is that there is a vast number of buildings that still require remedial work to bring them up to this standard, of which the Government Remediation Fund will not be able to cover. The Housing, Communities and Local Government Committee’s recent (June 2020) report on the progress of cladding remediation found that the £1bn remediation fund will only be sufficient to cover remediation work for 600 buildings, which is just one third of the total number that have combustible non-ACM cladding (1,700). We therefore agree with the Committee’s recommendation that government should guarantee that additional money will be made available when it inevitably becomes necessary.

2.1.  The Building Safety Regulator

The draft bill provides detail on what the responsibilities of the new regulator (part of the HSE with amendments to the Health and Safety at Work Act to reflect this) are, which are mainly 2-fold;

1. To introduce a better safety system
2. Impose sanctions and regulations to ensure this happens

The regulator will deliver these by introducing a more stringent regulatory framework that will implement more focus on building safety for landlords and developers. The regulator will also have powers to take enforcement action and impose sanctions on companies (Inc. Building Control companies) if they fail to meet the regulatory standards.  In some cases they may also act as building control under the Building Act 1984 and can enforce building regulations on these “higher-risk” buildings (see below for the definition of “higher-risk” buildings.

As well as an enforcement role the Regulator will also provide assistance and encouragement to dutyholders throughout the construction phase and to the Accountable Person and residents once buildings are occupied.

The regulator will have other duties, such as setting up committees on industry competence and a Building Advisory Committee.  The Regulator will also be involved in communication with residents of the higher-risk buildings within scope, local FRS. To ensure the Regulator is achieving its objectives regular updates will be published issued annually and the Secretary of State will appoint an independent person to review and report on the effectiveness of the Regulator.

Comments

The regulator will have more powers than any other regulator has (construction related) and this will of course be crucial in ensuring the Government meets its own policy intentions.  This will also establish an appropriate scope for ensuring the regulatory system is effective and delivers on the requirements.

We are concerned, however, that the regulator will not have the resources to fully deliver the full remit of their role and due to this limited resource they are likely to need assistance from Local Authorities.  The Government and the regulator will need to carefully consider how this will work and how they will ensure the competence of the Local Authorities to assist the regulator.  Also the regulator will use authorised officers who will have the power to request you attend interviews, supply documents.  Existing HSE officers “could” be shifted into these new roles, but this may be difficult to do.  The Government needs to establish a clear and resourced strategy to ensure effective recruitment of these authorised officers.

2.2.  Dutyholders

There will be a new dutyholder system for every building and the dutyholder will be responsible for managing any risks. This will include the building cycle being split into gateways with different dutyholders at each of these stages.  This will also be similar to CDM.  For example the principle designer will be the dutyholder at the design phase and the principal contractor will be the dutyholder for the construction phase.

Once occupied the dutyholder will become the Accountable Person (building owner) who will then be responsible for the safety of people living in the block. Gateways will require specific information to be submitted once that stage has been reached – in some cases this will result in a HARD STOP until the required documentation and progress has been met and approved.  If approval is not granted, construction cannot start again. 

This is effectively the start of the Golden Thread of information which will include details of the original design/construction and of course any changes throughout the building lifecycle.

Comments

The dutyholder will be responsible for all information during this time, and this will be an important role, especially as construction work may have to stop for a period if information is not provided in a timely manner.  It is important to consider that whilst this information may be made available and submitted as requested, it is not known how long it will take the Regulator to review/approve the information.  As we noted earlier, it will be vital to fully resource the Regulator to ensure they do not act as a break on growth.

It is also important to consider how the dutyholder can be supported at each stage as their competence throughout each stage will vary, especially for existing buildings where the level of information may not be to the level required. As a Group, we are considering how we could help to support dutyholders/accountable persons for existing buildings including through building specific training to help support the information that is already held.

2.3.  Accountable Persons and Building Safety Managers

As highlighted in the draft Bill, although similar to “responsible persons” accountable persons can be individuals or an organisation.  A key requirement of the accountable person is to appoint 1, or a number of, Building Safety Managers (BSMs).  This will be required once the Bill has passed through parliament, however a number of organisations have already made appointments for example Trafford Housing Trust and Northwards.  Recent feedback has highlighted that these BSMs could be directly employed, or provided by an external consultancy (similar to how CDM is sometimes managed).  Whichever way the BSMs are employed the BSM will be an individual named person responsible for a number of blocks.

The role of the BSM will be to support the accountable person in ensuring buildings of 18m+ (HRRB) are safe and they will be responsible for the day to day management of the building.  This will also include things such as resident engagement and various weekly/monthly inspections that are required.  They will work with managing agents where present and also with the Building Safety Regulator

The BSM must be competent – they “must have the organisational capability and relevant skills, knowledge, experience and behaviours” as the Regulator has the ability to remove them if they are not – however there is not any real detail about what makes them competent at this stage.

The BSM will also mage the Building Safety Case and the production of this (although it is the accountable person that is responsible for the ultimate submission and ensuring it accurately represents that the building is safe.

As well as the production of the Building Safety Case, the BSM will also be involved in the handling of customer complaints, however we need to understand more how this would work for PfP given we already have a team that handles customer complaints.

The BSM will also be responsible for ensuring that regular risk assessments are completed, and this is more than the current Fire Risk Assessment.  For example, for blocks with cladding there is already a requirement for a Fire Engineer report to be completed to confirm the cladding is safe, however like FRAs this will need to be reviewed and considered as part of the Building Safety Case.  This would also require structural surveys to be completed and reviewed as well.

Comments

The Accountable Person

The Government has already taken on board previous feedback with regards to this position, as it was first felt that the Accountable Person would need to be a named individual.  We welcome the position in the Bill, namely that this can be RP or local authority, effectively the freeholder for the building.   Government should also consider the case for there to be more than one Accountable Person in a building, i.e. where a long lease has been taken out and one organisation is responsible for some areas and another organisation is responsible for others.  There needs to be clarification issued as to how this would work as the Bill is currently silent on this point. 

The Building Safety Manager

The BSM role and the completion of the building safety case will be integral in the regulator being able to demonstrate that an effective new regulatory system has been established and that there is an effective system of accountability.  However, we do not believe that there is currently the availability of people that can be considered competent to fulfil the role of Building Safety Manager. We appreciate there will be people with some of the skills & competence needed, but not someone we could recruit “today” who could be considered a competent Building Safety Manager.  Therefore, greater clarity is required by the government and / or regulator on the key areas of competence with regards to qualifications, training, experience and membership of a professional body for the Building Safety Manager role.  This will enable the Accountable Person to upskill current staff to provide them with the required qualifications, or recruit BSMs with the correct competencies to ensure they meet the regulator requirements and therefore reducing the risk of the BSM appointments being vetoed by the Regulator.

2.4.  Building Safety Case

The accountable person for an occupied higher-risk building must, as soon as reasonably practicable after the relevant time, prepare a report (a “safety case report”) containing—

(a) the accountable person’s assessment of the building safety risks relating to the building

It is essentially the response to the exam question:

“Can you identify the building safety risks in your building, and show me how you manage these on an ongoing basis, as far as you can, so that it is safe?”

The Safety Case Report summarises all the key components of the safety case with references to supporting documentation. It is supported by the wider safety case which refers to the totality of the building safety information and includes all the evidence that supports how these building safety risks are being managed, contained within the golden thread of information.

There is no current “template” available to help us understand the requirements for a Building Safety Case, however an overview of what has been developed of what we believe will be required and we are further working with C365 and other RPs to try and determine what will be required.  A number of early adopters have completed early building safety cases, however they are unfortunately not able to share these at this current time.

Comments

The Safety Case will be an important piece of information and will need to be kept constantly up to date.  It will be a time consuming document to complete, however as long as the information is readily available this will ensure that the report can be completed accurately and in the most efficient manner.  This is why we are working with housing technology partners to see what solutions can be developed to assist.  It is also expected that 3D modelling (BIM modelling) will play a crucial role in the future and this is something we are exploring.  For example introducing a highly accurate 3D model of existing blocks would have benefits with regards to future reinvestment works.

Early Adopters have already produced some early safety cases and some have used BIM modelling to complete their safety cases.  For example Clarion have undertaken full laser scanning using BIM modelling on one of their blocks to complete their safety case, they believe this has made their safety cases easier to produce as BIM modelling allows them to record a lot more information within the system and is easy to update. 

We see a strong case for MHCLG to share feedback from the submissions made by the Early Adopters to provide a steer on the good practice undertaken to date as well as any lessons learned so we can be aware of what we should/shouldn’t be doing in this regard. 

2.5.  Key definition of HRRBs (Higher Risk Residential Buildings)

The Bill highlights that the classification of a HRRB will be buildings where;

a)        The floor surface of the building’s top storey is 18 metres or more above ground level (ignoring any storey which is a roof-top plant and machinery area or any storey consisting exclusively of plant and machinery rooms); or

b)        The building contains more than 6 storeys (ignoring any storey which is below ground level).

However there is also the ability for the definition to be amended as required by the Regulator or the Secretary of State. 

Comments

It is good that the definition has finally been made to confirm which buildings will initially be in scope.  However, Government needs to be conscious of the fact that this means other buildings could come into scope of the Bill and the remit of the Building Safety Managers and also require Building Safety Cases.  Equally a building may at some point in the future be deemed as no longer classed as “higher-risk”.

This means that building owners will need to consider which buildings may be considered for inclusion in future years. 

2.6.  Customer Engagement

Clause 82 requires all Accountable Persons to produce a Resident Engagement Strategy to promote the participation of residents and flat owners in the decision-making about building safety risks in their building. The high-level requirements for meeting this obligation are set out in subsection (3) and confirm that the Strategy will need to the information that the Accountable Person will provide to residents, the scope of what they will consult residents about, the methods the Accountable Person will use to seek residents’ views and details of how they will measure the effectiveness of their strategy. 

The bill we ensure that customers are at the forefront of decisions for their building.  Where decisions impact residents we will need to ensure there is proper consultation, which using the sprinkler project as an example, this is already undertaken.  However this in the future would be completed by the Building Safety Manager.  It should be noted that this may mean we have to also consult with customers representatives, which could be external companies/consultants appointed to act on their behalf.

Comments

Customer engagement will be key to the success of this legislation and this will also be an integral role of the Building Safety Managers. Some initiatives are already underway that will further improve customer engagement and customer communication.  For example we are preparing to launch a Fire Safety week for all of the blocks of 6 storeys and above as an initial pilot and we are looking at how we can develop a customer friendly FRA that provides the customer with key information about their blocks and includes all actions from fire risk assessments.  We are also exploring how a customer portal could be created that would allow customers access to the relevant building safety information for their block.

From an initial review of the Draft Bill, there doesn’t appear to be a mechanism to deal with disputes in approach to building safety. It would therefore be useful to have greater clarity on this. If the accountable person is responsible for consulting with residents it should be clear what happens if the residents do not agree with the approach being proposed. Our experience suggests that Customer Engagement could be very time consuming, especially where customers appoint companies/consultants to represent them.  Devonshire’s, for example, recently commented that the BSM may well need support in this regard as the customer engagement and communication could be a full time job in in itself.

2.7.  Increased Sanctions

Sanctions can be placed as highlighted earlier that stop construction of a building. Compliance notices can be issued where construction projects breach regulations or to compel accountable persons to fix certain issues by a set date. Fines are now unlimited or 2 years in prison.  The sentence for individuals found to have breached regulations is now a max of 10 years (increased from 2 years).

Comments

Following Grenfell it has always been anticipated that there would be a greater focus on the sanctions available to the regulator in the event of a serious incident. We agree with the level of sanction proposed.

2.8.  Residents Duties

Clause 86 provides that a resident of a higher-risk building (aged 16 or over) must:

• Keep any relevant resident’s item in repair and proper working order;
• Take reasonable care not to damage any relevant safety item (this means anything in the common parts);
• Comply with a request from an Accountable Person to provide information reasonably required for the Accountable Person to perform their duties to carry out an assessment of building safety risks and take steps to reduce those risks; and
• Comply with such other duties as may be prescribed.

Residents are also required to comply with any additional duties that are prescribed by the Secretary of State.  If the Accountable Person suspects that a resident has not met the above requirements they are entitled to serve them a notice that specifies;

• What the resident is supposed to have done and why this is a breach of their duties;
• What action the resident should take so they are no longer in breach;
• Anything the resident should not do to avoid further breaches, and;
• What may happen next if the resident fails to comply?

Following the issue of a notice highlighted above, this is where the Accountable Person may request a court order that requires a person to provide specified information.  As an example of where this could be used is where a leaseholder of a flat in a HRRB is responsible for ensuring their gas boiler is regularly serviced and in good working order.  If the Accountable Person believes this is not being done they may serve notice requiring the leaseholder to have the boiler checked by a gas engineer – if this was refused this could be raised to the county court and an order sought requiring the leaseholder to have the boiler checked.

In addition Clause 87 provides that upon an application by the Accountable Person the county court may make an order:

• Requiring the resident of a property to allow access to the dwelling at a reasonable time on a specified date or within a specified period; and
• May, if it appears to the court necessary, permit the taking of measurements, photographs, recordings or samples.

However, the court can only make such an order where it is satisfied that the Accountable Person has requested access previously in writing, the request is made in connection to their duties, entry has previously been denied and in the request for the order we need to make it clear where a resident has breached their duties.

Comments

Clearer guidelines are needed on residents’ duties to assist with situations where our customers do not allow access to undertake the relevant fire safety checks (and other compliance related inspections).  This is especially important as fire doors are now considered as part of the communal areas and are now within the scope of the Fire Safety Order.  This has been introduced in recognition of the issues experienced currently in trying to gain access to properties. The process appears to be similar to one we undertake now, however it is hoped that having these responsibilities clearly defined within the Bill will make the process quicker and easier to process through to resolution, ultimately allowing access and the completion of any required inspections or works. 

Initiatives such as Fire Safety Week, which we will pilot later in 2020, will help us to communicate directly with customers and help to shape how we can make them aware of their responsibilities under this draft Bill. What is still unknown is what the consequences, or potential action that can be taken is, if residents do not comply. Government should address this in the legislation.

2.9.  Leaseholders

A new Building Safety Charge has been proposed in the bill for leaseholders.  This is separate to the service charge.  Freeholders will be required to hold the money from the new charge in a separate account held by a financial institution and it will only be used to pay for works.  Leaseholders can refuse payment if this charge is deemed “unreasonable”.  However under the new rules, leaseholders will be required to pay the fire safety charge within 28 days of when the “bill” is issued.  This can include the costs for day-to-day management of the building and the building safety manager.

Comments

Government needs to provide a lot more detail to enable the sector to understand exactly what can and cannot be considered for inclusion with this charge and given the potential costs of some works (especially where other building owners have had to remove/replace cladding) these can be very high.  It is also not clear if some or all of the costs for the BSMs can be included within this charge.

Further clarity is required with regards to whether this just applies to leaseholders or will also include other customers, whether on a fixed or variable service charge for services to communal spaces. There will also potentially be an impact on staffing resources as undertaking things such as providing financial statements within 28 days will be challenging. Further clarity needs to be provided on the following:

• Will existing safety type charges move from service charges to the new Building Safety Charge for example, Fire alarm testing and maintenance, legionella testing, emergency lighting.
• Will the bill take effect from the start of the financial year or if not, will we have to consult customers and can the charge be applied mid-year.
• What are the proposals to deal with affordability issues for customers and landlords (if costs aren’t recoverable for tenants as well as leaseholders).
• Will the new charge encompass remedial works from Fire Risk Assessments?
• Can notices and demands for Building Safety Charges be issued in conjunction with Service Charge statements to minimise the level of correspondence to the customer.
• Providing financial statements within 28 days will be challenging particularly given that year end is still being finalised mid-way through the following month.
• The ‘bill’ details how to deal with a year-end surplus but what happens if there is a deficit, can this be recovered in line with a variable service charge.

2.10.        New Homes Ombudsman

As previously announced, clauses concerning the creation of the New Homes Ombudsman are also outlined in the draft legislation:

• The Bill introduces a power to require developers, or developers of a specified description, to become, and remain, members of the New Homes Ombudsman and make provision for sanctions should developers breach requirements. Developers who receive a sanction will be able to appeal that decision.
• The Bill includes provisions that allow ‘relevant owners’ of new build homes to escalate complaints to the New Homes Ombudsman scheme.
• The definition of ‘relevant owner’ covers individuals rather than businesses. Such individuals must own the relevant interest in land. The individual bringing the complaint must occupy the home as a private residence but may let the property to another person for that person to occupy the home.
• However, the clause doesn’t restrict the New Homes Ombudsman scheme to receiving complaints from ‘relevant owners’ only. It may include provision for other people or organisations, however, it will be up to the New Homes Ombudsman scheme to set out who can complain to it in these circumstances.
• The Secretary of State must make arrangements for a scheme to be available for complaints against members of the scheme to be investigated and determined by an independent person.
• The Bill includes the provision for the Secretary of State to make payments to enforcement bodies to investigate and impose sanctions in respect of breaches by a developer.
• The Bill introduces a power to issue or approve a code of practice for the conduct and workmanship expected of members of the New Homes Ombudsman scheme.
• Where a code of practice is issued or approved by the Secretary of State, the New Homes Ombudsman scheme, (which will include provision about the matters in relation to which complaints about members may be made under the scheme) must include provision for complaints about non-compliance with the code of practice.

Comments

The scope of the ombudsman’s powers should be clarified in order to ensure they are not inconsistent with other non-regulatory bodies (such as building warranty providers and the HBF) involved with new build development to ensure that new home owners have clear routes of redress and developers are able to structure their processes for a unified set of standards/processes.

September 2020