This update is a high level overview of the draft Bill. Over the coming months we will publish a series of notes discussing different elements of the draft legislation and what they mean for landlords, tenants, developers, and those they engage. Keep an eye out for those if you would like to know more.

What are the key proposed changes?

Higher risk buildings

The draft Bill imposes more stringent requirements in relation to “higher risk buildings”. Whilst the definition of such buildings is to be set by the Secretary of State in due course, the government suggests this includes residential buildings 18m or more in height or over six storeys (excluding basements and certain plant space) and student accommodation, but excludes, amongst other things, hotels, care homes and hospitals.

Building Safety Regulator

A new Building Safety Regulator will be responsible for overseeing the safety and performance of all buildings and for enforcing a more stringent regime for higher risk buildings.

Obligations for higher risk buildings in construction

• Dutyholders under CDM 2015 will have new responsibilities to comply with building regulations requirements and will be responsible for showing compliance with the new regulatory regime during the construction phase.
• Those involved in the construction phase will be required to collate and maintain what is described as the "golden thread" of information and to hand it over to the Accountable Person when the building is complete. The golden thread will cover the original design intent and any subsequent changes to this and is to be used to support the safe management of the building through its lifecycle and to assist with safety improvements.
• There will be 3 new gateways (before planning permission is granted, before construction begins and before occupation) and the new duty holders will be expected to show compliance with the new regime before a project can pass to the next stage.
• There will be a new requirement to report structural and fire safety issues which could cause significant risk to life to the Building Safety Regulator.

Higher-risk buildings during occupation

• Higher-risk buildings will need to be registered with the Building Safety Regulator and to have a building assurance certificate before occupation.
• There will be new duty holders during the occupation phase – the Accountable Person and the Building Safety Manager. The draft Bill contains detailed provisions setting out what each will be required to do and how they will be expected to interact with the Building Safety Regulator and residents.
• The Accountable Person and Building Safety Manager will be responsible for keeping the golden thread of information up to date and sharing it with the Building Safety Regulator and residents.
• Residents will be encouraged to participate in decisions about the safety risks in their building through a Residents’ Engagement Strategy. The strategy should set out what residents will be consulted on, the information to be provided to them and how their views will be taken into account.
• A complaints procedure is to be created through which residents can raise concerns regarding the safety of their building or the Accountable Person’s compliance with the Residents’ Engagement Strategy.
• Residents will be required to keep their gas and electrical appliances in good working order and take care not to damage a relevant safety item (e.g. disable an automatic closer on a fire safety door). They will also be required to comply with an Accountable Person’s reasonable request for information to allow the Accountable Person to carry out their role. Residents failing to comply with these requirements may be subject to a court order.
• There are proposals for new implied terms in long leases (a lease granted for a term exceeding 21 years or a fixed term lease subject to perpetual renewal). Broadly speaking these cover the building safety charge (both landlords and tenants); an obligation to keep gas and electrical appliances in good order referred to above (tenants); a requirement to carry out prescribed building safety measures and to apply for financial support to do so (landlords). It will not be possible to exclude these terms.
• Costs associated with maintaining building safety measures should be split out from other service charge items and shown as a building safety charge and charged in a manner reflective of standard service charge provisions in long leases. These, and other requirements in the draft Bill (including a reasonableness test and consultation provisions) are intended to facilitate transparency, to ensure that landlords do not use these monies to fund other improvements to their properties and to limit the costs that can be re-charged to leaseholders.

Wider changes in the draft Bill

• There will be a new national Construction Products Regulator and a new Construction Products Standard Committee. The latter will advise the government on whether voluntary standards for construction products should become regulatory standards and about product test standards.
• There will be new sector specific and industry wide competence frameworks for those involved with the design and construction of new buildings.
• A New Homes Ombudsman will be created.
• There are plans for a new regulatory structure for building control (both local authority and approved inspectors) and the introduction of a new role, a registered building inspector, who will be able to advise local authority building control or approved inspectors who oversee building work.
• The time limits for prosecution for breach of building regulations will be extended and the Building Safety Regulator will have new enforcement powers for breaches by all duty holders (whether during the construction or occupation phases).

What happens next?

Given the size and complexity of the draft Bill it has been published “for pre-legislative scrutiny before [it is introduced] ….. to Parliament”. The draft Bill will, therefore, be reviewed by a Parliamentary committee which will provide feedback and recommendations to the government. The government has announced that it also intends to work with stakeholders on “areas that need refinement or further consultation to finalise measures.”

Once finalised (and there is no indicative timescale for this) the Bill will be introduced in the House of Commons or House of Lords and will be subject to the usual legislative scrutiny before coming in force. In practice this means legislative changes are still some way off. However, the industry is being encouraged to start making changes now “…. industry must be in no doubt that it is not enough to wait for the Bill to become law before they implement changes; we expect them to start taking action now” (Dame Judith Hackitt).

Other government announcements

As if the publication of the draft bill wasn’t enough, the government has also:

• announced that it will appoint an independent expert to review possible funding solutions to protect leaseholders from exposure to unaffordable costs arising from remediation of historic cladding (and other) safety defects;
• launched a consultation on implementing the recommendations of the Phase One report of the Grenfell Tower Inquiry;
• announced that full applications for the Building Safety Fund (the £1bn fund to assist with the removal of unsafe non-ACM cladding from high-rise residential buildings announced by the Chancellor this spring) can be submitted from 31 July; and
• announced the publication of a Manual to the Building Regulations which will contain all the Approved Documents in one place.