Safety first

Nobody involved in the construction and property industry is likely to be unaware of the significant impact that the Building Safety Act 2022 (BSA or the act) will have on the sector; one year in and its effect is already being felt. The groundbreaking reforms seek to:

• give residents and leaseholders more rights, powers and protections, and
• create enhanced regulatory regimes for building safety and construction products covering the whole lifecycle of a building, including its design, construction and occupation.

The BSA received royal assent in April 2022, with the intention that its provisions would be brought into force over a two-year period. Despite its six parts and 11 schedules covering 265 pages, the act is just the beginning of the story and is being supplemented with regulations and guidance. Keeping on top of the latest developments is a challenge, to say the least.

A quick recap of the key developments since spring is set out below.

Registering a high-rise building

The process for registering high-rise residential buildings in England opened on 12 April 2023. The BSA requires all high-rise residential buildings that are at least 18 metres tall or seven storeys high and have two or more residential units to be registered with the Building Safety Regulator (BSR) by 1 October 2023. Responsibility for registration falls on the principal accountable person. New buildings completed after 1 October 2023 must be registered before residents can occupy them.

The government issued guidance in May 2023 on the information that will be required about the building’s structure and fire safety. The key building information must be provided in electronic format and covers a number of potential risk factors.

The guidance does not, however, explain how the BSR is going to review the information it receives or how long it will take. An estimated 12,500 high-rise buildings will need to be registered and there are concerns about potential resourcing issues. However, the BSR is reported to be recruiting more than 160 staff members in the coming months, which will increase its workforce by 60%.

Further guidance issued in June 2023 sets out the criteria for a building to be classed as a higher-risk building during the occupation phase of the higher-risk regime. This includes explanations and diagrams of different building types and how to count storeys and measure height.

The Health and Safety Executive (HSE) sees the registration process as a crucial stage in establishing the new building safety regime and a failure to comply with the legal registration requirements for occupied buildings by October 2023 may result in investigations and, ultimately, criminal prosecution for owners and managers.

Testing for a safer future

Schedule 11 of the BSA gives the secretary of state wide-ranging powers to govern how construction products are assessed, marketed and regulated, seeking to establish a stronger regulatory framework for construction products through secondary legislation. To inform this, an Independent Review of the Construction Products Testing Regime was announced in April 2021 and the report was published in April 2023.

The report highlights a number of systemic issues with the current regime for regulating the safety of construction products, the Construction Products Regulations (CPR). The most obvious gap is that the CPR only cover construction products for which there is a designated standard and, since this accounts for about one-third of all construction products, it leaves up to 30,000 products unregulated. Many standards are outdated, inconsistent or non-existent. Under the current system, products are tested to see whether they meet the relevant standard rather than testing their safety – a crucial distinction. Further criticism was levied at the complexity of the process and the disconnect between those involved in the testing system and those who design and construct buildings. The report notes that enforcement has been virtually non-existent so that “bad actors feel that they can bypass the regulations without consequence”.

The report makes a series of detailed recommendations under 20 headings (complexity, capacity, general safety requirement and so on) to strengthen the testing system and bring confidence that construction products are safe and perform as labelled and marketed.

Michael Gove, secretary of state for levelling up, housing, and communities (DLUHC), has stated that he will set out proposals for reform of the UK’s construction-product regime, building on the work of this review. He makes it clear that products used on homes and buildings must be safe and handled correctly, and manufacturers must be competent professionals. He warns that those who try “to misrepresent or misuse their products or mislead their customers must be sure that they will be found out and held to account”.

On the same day, it was revealed that he had written to shareholders in three cladding companies warning that the manufacturers they invest in will face “severe consequences” if they do not come forward with a comprehensive financial package to fix unsafe buildings. As has been shown by the action taken against developers (see below), this is unlikely to be an empty threat.

Leaseholder protections

On 12 June 2023, the government released a set of draft amendments – the Building Safety (Leaseholder Protections etc.) (England) (Amendment) Regulations 2023 – to the secondary legislation key to the operation of the leaseholder protection provisions in the BSA. The explanatory memorandum makes clear that the amendments and clarifications to the existing leaseholder-protection regulations are to ensure they have the effect that was originally intended.

As a reminder, the BSA provides protection for tenants of ‘qualifying leases’ against remediation costs for ‘relevant defects’ in the form of various caps and restrictions. The provisions are complicated but, in essence, the protections will vary depending on the wealth of the relevant landlord, the value of the leasehold interest and whether there is a ‘qualifying lease’. The concept of landlord certificates and leaseholder deeds of certificate, introduced by the BSA, enables the parties to have the relevant information to determine which protections apply.

Amendments to the Building Safety Regulations (SI 2022/859)

Key changes to the Building Safety (Leaseholder Protections) (Information etc.) (England) Regulations 2022 (SI 2022/859) include the following:

1. The Homes and Communities Agency is added as an interested person who can apply for a remediation order (RO).
2. The category of interested persons who may apply for a remediation contribution order (RCO) has been expanded to include the Homes and Communities Agency, the named manager, RMC (residents’ management company) and RTM (right to manage) companies of a relevant building.
3. Within one week of receiving a leaseholder deed of certificate, the landlord must provide a copy to any RMC, RTM company or named manager.

Amendments to the Building Safety Regulations 2022 (SI 2022/711)

Key changes to the Building Safety (Leaseholder Protections) (England) Regulations 2022 (SI 2022/711) include the following:

1. A new circumstance for providing a landlord’s certificate (LLC) has been introduced. An LLC will also be required within four weeks of a new leaseholder deed of certificate (if this contains information not included in an earlier LLC).
2. An attempt has been made to reduce the administrative burden and LLCs no longer have to contain as much specified information relating to the landlord group structure / accounts and the relevant defects and remedial works, where certain requirements have been met. There are six different scenarios described in the draft regulations, each of which is accompanied by a different list of documents that are no longer required.
3. The list of information must now include the percentage of storeys in a relevant building for which each relevant landlord was the landlord at the qualifying time.
4. A new form of LLC is substituted.
5. Within one week of issuing the LLC, the landlord must now also provide a copy to any RMC, RTM company or named manager.

It remains to be seen whether these amendments will have any effect on the administrative burden the LLC regime has placed on landlords and it is still not clear when the draft regulations will actually come into effect – these were approved by the House of Lords on 20 July 2023 but have yet to be signed by a minister. Given the summer recess, it may be autumn before they come into force.

Responsible actors scheme

The responsible actors scheme (RAS) was launched on 24 July 2023 for residential developers in accordance with the Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023. It is the culmination of the developer pledge and the developer remediation contract and its aim is to:

• incentivise developers to get on with the remediation or mitigation of life-critical fire safety defects in residential buildings of 11 metres and above, which they developed or refurbished in England over the 30-year period to 4 April 2022, and
• to reimburse government schemes where work has already been carried out at tax-payers’ expense.

In reality, developers have little choice but to join. Those who are considered eligible have been invited by the secretary of state to join the RAS and given 60 days to respond. In order to join, eligible developers will need to respond to the invitation, apply for membership and enter into the developer remediation contract. If successful, the developer’s name will be added to the RAS members list. Eligible developers who do not sign up, or have their membership revoked because they have not complied with the membership conditions, will be added to the RAS prohibitions list and will be prohibited from carrying out major development in England and from securing building-control approval.

A joint statement issued on 26 July 2023 by the DLUHC, the BSR, the Local Government Association, and the National Fire Chiefs Council commits to working together to see buildings made safe faster. Building owners watch out – robust enforcement action is expected and indeed promised to be taken in spring 2024 for those who have yet to remediate buildings.

Cladding safety scheme

On 25 July 2023, the government announced the opening of the cladding safety scheme (CSS), which will provide funding for the remediation of unsafe cladding in England where a responsible developer cannot be identified, traced, or held responsible. The CSS will be available to all eligible buildings over 11 metres outside of London and between 11 and 18 metres inside London. The CSS replaces the pilot medium-rise scheme in operation since November 2022 and means that costs of fixing dangerous cladding for all buildings in England over 11 metres will now be covered either by government funding or by the developers who built them.

By the time this article is published there will no doubt be further developments. The broad spectrum of issues touched on above illustrates the wide-ranging nature of the BSA. And the pace of change will now ramp up, with 1 October 2023 being a key date in the BSA calendar. This will bring with it the registration of new high-rise residential buildings, the BSR taking over as the building-control body for higher-risk buildings, the introduction of gateways two and three and the expected coming into force of an array of additional regulations.

Enough to keep us all busy.