Written evidence submitted by the British Property Federation [BSB 358]
Section A - Key points
Capacity and scope
Review and measurement (clause 34)
Accountable person (clause 61)
New roles and insurance (clause 65)
Implied terms and charges (clauses 88 and 89)
Cost and incentivisation
Context of wider Government reforms
Section B - Clauses
3 The regulator’s objectives
As noted in our key points we would stress that the regulator must be resourced appropriately to meet their objectives and we would like to see regular parliamentary scrutiny of that committed to the draft Bill.
7 Proposals and consultation relating to regulations
We broadly support the emphasis on consultation and welcome this clause. As we have set out under our key points it will be important the regulator builds up an appropriate consultation database, given this is a very different role to much of the HSE’s existing work As an executive non-departmental public body, sponsored by the Department for Work and Pensions, the regulator will also need to build up sufficient links and protocols with other parts of Government and local government. In respect of the constituency we represent, they will need to also take account of the different drivers and approaches to management in residential leasehold, build-to-rent and student accommodation.
33 Fees and charges
We would like to see some reference in this clause to the regulator and Secretary of State also taking account of the cumulative cost, as well as individual fees and charges, and ensuring that is reasonable.
34 Review of regulatory regime
We support the broad objective of this clause, but as we have set out in our key points we feel that during the first five-year period there should be n interim review, perhaps as soon as two years after introduction, to ensure that the new regime is bedding in as intended.
44 Regulation of building control profession
We agree with the objective of this clauses, but would flag the concerns we raised in our key points about the potential loss of approved inspectors that has already taken place, impact that might have on capacity, and fears that capacity may be further reduced by the inability of approved inspectors to obtain competitive professional indemnity insurance.
46 Functions exercisable only with advice of registered building inspectors
We support this clause. We would only note that the additional burden on local authorities will need to be resourced.
48 Higher-risk building work: registered building control approvers
We very much support the intent of this clauses to prevent developers choosing their own building approvers.
We would only stress the importance of insurance to the function of this whole new regime and the challenges that various roles may face obtaining viable professional indemnity insurance.
This seems a positive proposal. There will be devil in the detail in terms of keeping the information secure and the burdens on information providers proportionate. However, in principle, the benefit of a portal may be some standardisation of information provision and we welcome that.
A further concern, is whilst information may be provided, are information receivers – including the Fire and Rescue Service - suitably resourced to review and act on the information. Without this, there risks an illusion of control that more information exchanged will result in better decision making.
61 Accountable person
As we set out in our key points, we think the definition the Government has landed on is one that broadly reflects the complexities of property ownership and captures the intent of the regime that Dame Judith Hackitt designed in the draft legislation. The definition should also capture situations where the leaseholders have taken control of building repairing obligations through a residents’ management company or having exercised their Right to Manage.
65 Building assurance certificate
We support the intent of this clause, which encapsulates the process at Gateway 3 and it quite right that is reflected in some sort of public display to provide assurance to the users of buildings. As we set out in our key points it is imperative the certification process is swift and adheres to prescribed timescales. It will also be important that prospective owners are prepared for these new requirements. One concern to flag is the interaction between the certification process and insurance for the building. It will be important that refusal of a certificate does not invalidate insurance, only the occupation of the building until certification is achieved.
69 Terms of appointment
We support the creation of the Building Safety Manager (BSM) role, but as expressed in our key points have concerns about the wide scope of the role and therefore ability of BSMs to obtain viable professional indemnity insurance. It will be vital to the whole regime that adequate insurance is available for the BSM role. The insurance industry thus far has not been able to provide a definitive answer to that question because the regime and role was still being defined. We would like to see a clause in the Bill, which defines the availability of adequate insurance cover and regularly tests whether that is being met.
78 Mandatory Reporting Requirements (MRR)
The reporting criteria and timescales will need clear guidance along with the powers and expectations that the regulator will then have on building owners to remediate and implement interim mitigation measures. Examples – to what extent compartmentation breaches become reportable (when safe egress from a building is compromised might be logical); the extent of fire alarm system components being in fault need reporting. There could also be situations where interim mitigation (and remediation) attracts disproportion costs due to the regulator (and building owner) misinterpretation.
There are likely to be significant instances of under and over reporting of the MRR system. There is a question on resource and capacity of the regulator responding to MRR reports effectively, both to investigate and to advise actions promptly and sensibly where required.
86 Duties on residents
This is a key aspect of the new regime for our members. If they, or their property managers, are to fulfil some of their duties. they will require the co-operation of all residents. Most residents are co-operative, and it is their homes we are talking about. Dialogue will resolve a lot of situations, but for a minority it is important there is a backstop, so that our members can ensure all residents are safe. We know MHCLG colleagues have given careful thought to this part of the bill. The process the draft Bill sets out, with the backstop of the County Court, is we think proportionate and we support this clause.
There should also be an onus on the regulator to communicate duties direct to residents at large i.e. regular nationwide communications exercises.
The range of residents, and their expectations, is huge from student for a year, through supported housing occupier with learning difficulties to part-time resident of £10m luxury apartment.
88/89 Higher-risk buildings: implied building safety terms/Building safety charges
As flagged in our key points, we agree with the intent of clauses 88 and 89. It is important landlords are able to perform building safety functions and recover charges for them, and that leaseholders should expect them to be fair and collected in a professional manner However, these clauses have not had the same scrutiny thus far as other aspects of the draft Bill. Both clauses generally cover the right subjects from our review of them.
Some residents will resist payment and execution of additional inspection and maintenance routines and for the protection of other residents it is important such charges can be collected.
We have flagged various problems with the proposed cap on building safety charges. We propose a better policy would be to have transparency on costs, through regular communication of costs for typical building safety services, so that leaseholders can judge whether they are being treated fairly, perhaps via the Leasehold Advisory Service, and a fast track to the Tribunal on disputed building safety charges.