Building Safety Bill

Baroness Neville-Rolfe Excerpts

Committee stage
Monday 21st February 2022 Grand Committee

[Baroness Neville-Rolfe (Con)]

My Lords, I was not expecting to speak after the noble Baroness, Lady Brinton, so I will not comment on her proposals but will wait to hear other comments. I thank the noble Lord, Lord Foster of Bath, for introducing the first group of amendments, and very much endorse what he said about the sad victims of Grenfell. I was thinking that taking fire safety and buildings away from the fire brigade, as we did about a quarter of a century ago, may have had some sad and perverse effects. I refer to my interests in the register, notably as a non-executive director of Secure Trust Bank and as the owner of property that is sometimes rented out. I am also proud to be chair of the Built Environment Committee and to see distinguished colleagues here today.

I was sorry not to be able to speak in the long and interesting debate at Second Reading. However, I remind noble Lords of my involvement in the Fire Safety Bill and the concern I expressed very early on about the position of leaseholders and their inability to sell property because of the uncertainties and the problems with the dreaded EWS1 form, which we will come on to. I look forward to debating the Government’s recent package later, but for now I turn to the regulator and his or her functions, the subject of this group.

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[The Minister of State, Home Office and Department for Levelling Up, Housing & Communities (Lord Greenhalgh) (Con)]

My Lords, I was not expecting to be in what the Romans called a frigidarium for this stage of the Bill. It is positively bracing. I am sure that as the week wears on we will get a slightly more normal temperature. It is already slightly better, so it clearly just takes a bit of time.

I will try to capture each group of amendments in three words or fewer. I am going to call this group the “widening the scope” group of amendments—that is three words. I will go through each amendment in turn. In practice, I have sympathy with every idea that has been put forward. However, I would like noble Lords to consider that the more we widen the scope, the greater the risk that we will actually fail in the first duty of any Government, which is to keep people safe. Our focus has to be based on what it is reasonable to expect from a new regulator in the Health and Safety Executive. So, although I have sympathy, I will resist this group of amendments, because, when we talk about high risk, the scope has to be necessarily tight in order to give the HSE the chance to grow as a regulator and to implement this regime properly.

However, I thank noble Lords for their contributions to this first group of amendments. I believe that this is a landmark piece of legislation and a necessary one. I can feel the broad support that it has from all sides of the House, and I look forward to further debates in Committee. There has already been good discussion in this grouping, and I am grateful for the commitment from all noble Lords to improve the Bill and to reform building safety more generally. I have listened to the concerns raised by noble Lords and I thank them for their helpful contributions. As I said, I will respond to them all in turn.

I start by talking about the fire which the noble Lord, Lord Foster of Bath, mentioned. It is true that it was a staggeringly awful fire, even though there was no loss of life, and the noble Lord captured that very well in his speech. I have spent quite a bit of time trying to learn the lessons of the near misses, if you like, so I have met Geeta Nanda, chair of the G15, who I have known for some time. She is also the chief executive of the Metropolitan Thames Valley housing association, which manages Richmond House within Worcester Park, which consists of 23 households of shared owners. I have also met Dean Summers—on Zoom; I have not met him in person—who took over from Sean Ellis, and I had a meeting with him as the new managing director of St James.

It is fair to say that Richmond House, which was built in 2011 by the Berkeley Group—St James is part of the Berkeley Group—was built in a shockingly bad way. It was built without internal compartmentalisation and certainly would never have passed the building regulations at the time. There was also inadequate fire-stopping, which is one of the reasons why the fire spread so quickly. Candidly, it is absolutely right that the Berkeley Group pays for its replacement and addresses all the losses suffered by the shared owners. I am very interested in that, and I have asked for a report from the housing association and Berkeley on progress on doing precisely that. The building was not built in line with building regulations, so it should not have happened. It is a four-storey building and is under 11 metres, which, according to the building regulations, should not have been able to happen, so we have an example of someone having signed off a building that should never have been signed off. That is the lesson of Richmond House.

Sometimes regulation does not work. That, for me, is the lesson. The other lesson is that fire is a tragedy, not just when you lose lives but in the opportunities lost. This Bill does a lot to make housing overall safer, and we will have much better housing stock over the next 30 years than we have had in the previous 30 years.

[Baroness Neville-Rolfe (Con)]

Another problem at Worcester Park might have been the failure to implement the building regulations. I have found building regulation enforcement very patchy. There has been a lot of very aggressive enforcement of building regulations in my lovely county, yet here there has obviously been a disaster with building regulations. Is enforcement of the regulations not also important, and will that be improved by our work here?

[Lord Greenhalgh (Con)]

I think we need to ensure the competence of enforcement and that it works, and the competence of the people who assess buildings and sign them off as fit for human habitation. In the same way with crime where we want an absence of crime, we want an absence of these problems. Yes, we need to improve enforcement and there needs to be the strong arm of the law. That is why we want to have a strong regulator in this new regulator under the HSE. We have Housing Act powers for local authorities to intervene. The fire service has powers under the fire safety order. There are lots of powers and lots of regulators that can step in and do something about it. In this case, they all failed. Yes, we need to strengthen them. We understand a lot more about the inadequacies of some of the built environment, but my noble friend is right that we also need to strengthen enforcement.

I thank the noble Lord, Lord Foster of Bath, for his amendments. On Amendment 1, I hope noble Lords will agree that the regulator should exercise its functions in line with its first objective: to secure the safety of people in and around buildings. I am concerned that adding additional objectives for the new building safety regulator could distract from this mission. The Bill provides the regulator with a broader objective to improve the standard of buildings. Achieving this could involve the regulator improving regulatory standards relevant to property protection, such as security, resilience and fire safety, so the regulator’s remit already extends to considering these issues.

Adding a specific objective for property protection would have two main downsides. First, it would put property protection on a par with resident safety as a priority for the regulator. The Government believe that the regulator should prioritise residents’ safety and do not want the regulator to be distracted from that. There is a risk that a specific requirement always to consider property protection would result in the regulator favouring solutions that go beyond what is required for residents’ safety. The second downside is that this amendment risks skewing the building safety regulator’s oversight function. The Government intend the regulator to use evidence to identify emerging issues with the safety and performance of buildings and to make recommendations to Ministers on regulatory changes where needed. A property protection objective would distract the regulator from using evidence to identify and rectify the most pressing issues, which might, for example, relate to net zero and sustainability rather than property protection.

The pre-legislative scrutiny committee considered property protection but found that the existing objectives are a sensible starting point—I emphasise “starting point”. The committee suggested that the Government keep this under review. We are committed to doing this through the provision in Clause 135 for a regular independent review of the effectiveness of the regulator and the wider regulatory system.

Turning to Amendment 12, there are already powers for building regulations to cover specific aspects of building resilience. We believe that it is better that building regulations are targeted on specific issues rather than open-ended requirements. However, we recognise that, for residential buildings, further research into property protection is warranted. The impact of the loss of a home is significant, so we are taking this forward as part of the technical review of approved document B on fire safety. I thank the noble Lord for suggesting these amendments and respectfully ask him to withdraw Amendment 1.

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[Baroness Brinton (LD) [V]]

My Lords, I shall speak specifically to Amendment 6 but I endorse the others, for reasons that will become apparent. One thing we have all become aware of, post Grenfell and the Hackitt review, is concerns about repeat problems emerging, whether they are systemic ones to do with the way a building has been built or newly emerging issues. They happen time and again, and yet the industry, councils and Parliament do not seem to learn from them. I shall give one brief illustration to explain.

In my role as health spokesperson for my group in the Lords, I know that we are increasingly concerned about some of the mould and damp issues increasingly found in more recent 1960s buildings, to which landlords have been very slow to respond. There is clearly a public health issue where especially children and the clinically vulnerable remain at risk and become ill, and yet there does not seem to be a mechanism to provide a review to make sure that there is learning from this, especially since it is happening across the country.

The other amendments in this group set out a swathe of mechanisms to ensure transparency and accountability for the BS regulator, the Secretary of State and Parliament. Returning to Dame Hackitt’s review, these amendments would be a strategic element to push the culture change that she sought, to make sure that those who have some responsibility have to look at a higher level to make sure that buildings are safe and are dealt with, and that the costs, both in building and in human experience, are monitored.

[Baroness Neville-Rolfe (Con)]

Briefly, I support the idea of review clauses and of learning from mistakes. Obviously, I have not been a Minister in this area, but I was a Minister in other areas and I did agree, occasionally, to review clauses where people had concerns. I found that the reports that came along two years later—if one survived that long—were actually extremely useful, and ensured that the Civil Service system was behind the objectives of the Bill. Exactly what one would put in a review clause is another question. I would certainly want added some of the points I made earlier—which the Minister helpfully said were contained in a code of practice for regulators—bringing up the agenda the sort of good practice we have seen at some of our better regulators, such as the HSE. I hope the Minister will think about whether there is scope for a review clause to help on some of these issues.

We talked about sprinklers. As people know, I have run supermarkets, so I have had practical experience of all these different fire safety methods. Certainly, when sprinklers were put in, it took away a lot of headaches, provided you could secure the water supply. That sort of innovation—whatever the new ones are; AI or whatever—can form part of a review process two, four or six years later.

[Lord Foster of Bath (LD)]

My Lords, Amendment 129 in my name proposes to add a short new clause to the Climate Change Act 2008. Section 56 of the 2008 Act says:

“It is the duty of the Secretary of State to lay reports before Parliament containing an assessment of the risks for the United Kingdom of the current and predicted impact of climate change.”


All I am seeking is to put in something to make more precise the need to refer to the impact of climate change on buildings and to say something about the location of those buildings that will be affected. It would require the Secretary of State to include in a report an assessment of the risks and the locations of such threats to buildings caused by climate change. We all know only too well, just today, the real problems we are facing because of climate change, yet climate change is not mentioned in the Bill at all. The amendment aims to rectify that.

Building Safety Bill

Baroness Neville-Rolfe Excerpts

Committee stage
Monday 28th February 2022 Grand Committee

[Lord Best (CB)]

My Lords, this group should not detain us too long, for three reasons. First, the group has only one amendment, this one. Secondly, the issue here is not of the same complexity or magnitude as the all-important matters that the Committee discussed last Thursday. Thirdly, I think that the Minister will not take too long to accept it. Amendment 45, in my name and the name of the noble Baroness, Lady Neville-Rolfe, concerns the impact of the Bill on the management of leasehold property, in particular the management by the leaseholders who live there.

The amendment has the backing of leaseholders and of bodies representing those managing leasehold flats, the Institute of Residential Property Managers and the Association of Residential Managing Agents. I declare an interest as chair of the Government’s regulation of property agents—RoPA—working group, whose 2019 report provides insights into the arrangements for managing blocks of residential apartments. Amendment 45 seeks to prevent the Bill from creating a major problem where residents of blocks of flats have responsibility themselves for the collective management of their homes. It covers the residents management companies, where the developer has handed over ongoing management to the leaseholders, and the right to manage companies, where residents have exercised their right to take control under the Commonhold and Leasehold Reform Act 2002, on which, incidentally, I gave my maiden speech 20 years ago.

These resident-controlled companies will have a board of unpaid volunteer directors. The directors will sometimes decide to employ managing agents to carry out the usual management and maintenance tasks, but the legal responsibilities for their company’s actions will remain with the directors. The Bill as it stands places a new layer of responsibility on these resident directors: they must, together, assume the role of the accountable person or principal accountable person responsible for building safety. This makes each individual director personally liable if things go wrong. They may engage expert help, but they cannot shed their accountable person status and the full liability remains with them.

The directors will now have to identify safety hazards, decide on the remedies and procure the necessary works. There are plenty of opportunities for mistakes and the new building safety regulator could discipline them, fire them or fine them, ruining their personal reputations. Fellow residents could sue them for mismanagement or misjudgment. Indeed, under Clause 131, if residents do not feel that the residents management company has done enough to recover money from third parties, they can take them to court.

The entirely predictable but unintended consequence of placing this serious new burden on resident directors is surely that no one will volunteer for the role. Already it is often a hard job to recruit and retain willing volunteers, who must not only give up their time but risk falling out with neighbours when taking decisions that cannot please everyone. It is commonplace for directors looking for a new volunteer to be economical with the truth: “It won’t be very time-consuming or onerous”, they say. How much more difficult will the recruitment of new and the retention of existing directors become if this Bill adds considerably to the obligations placed on anyone who dares to volunteer?

Amendment 45 seeks to resolve the problem. It has two parts. First, it would allow the residents management companies and right to manage company directors, if they wish, to pass on the functions and liabilities of the accountable person or principal accountable person to an external, competent, qualified third party with proper professional indemnity insurance, which the directors could never obtain. Secondly, it would enable the directors to pass on the costs of so doing to the residents via the service charges. With this amendment in place, a significant barrier to leaseholders managing their own affairs will be avoided.

Successive Governments have consistently encouraged residents to assume mutual responsibility for managing their blocks of flats. Indeed, moves are in the pipeline to relaunch the so far unsuccessful commonhold arrangements, whereby the occupiers own the freehold as well as handling the management. So I am sure that there is no intention to impose a huge disincentive for leaseholders to participate in residents management companies and right to manage companies. By enabling the duties imposed by this Bill to be transferred from the volunteer residents to professional experts, a potential exodus of volunteers can be avoided and the encouragement for more resident control can be sustained. I hope, therefore, that the amendment is helpful in correcting an unintended oversight and that it will appeal to the Minister. I look forward to the contribution of the noble Baroness, Lady Neville-Rolfe, and I beg to move.

[Baroness Neville-Rolfe (Con)]

I support the noble Lord in his Amendment 45. He has described the issue very well—and given his huge contribution to the House, I shall look up his maiden speech.

I worry that unless we can find a way out for leaseholders who are also owners, no leaseholder in their right mind would contribute to the management of a building jointly owned by leaseholders. This has been a direction of travel in recent years, which I support. I believe it to be particularly valuable for smaller housing developments, of which we need more. As my noble friend Lord Young of Cookham said in Committee on 24 February, successive Governments have encouraged leaseholders to buy their freeholds. Indeed, he himself played an important part in that process. As I understand it, the leaseholders who have enfranchised and bought their freeholds are excluded from support under the Bill. That seems very unfair.

I know from direct experience in my own family that it is already very difficult to secure volunteers to run leaseholder-owned buildings, given the onerous duties involved and the time requirement. The Bill, with its additional duties and tensions, will, I fear, make it impossible. Here we have yet another perverse effect. I agree with the noble Lord, Lord Best, that a solution must be found by Report, either by accepting his amendment or, if need be, in some other way. This is an unintended consequence that nobody wants.

[Baroness Pinnock (LD)]

My Lords, this is such an eminently sensible amendment, in the names of the noble Lord, Lord Best, and the noble Baroness, Lady Neville-Rolfe, that I think that the Minister will struggle to counter the arguments that have been made. What we are asking in this amendment is to avoid a situation involving resident management groups, or leaseholder-controlled companies, where the stringent expectations required to fulfil the duties under the Bill are put on the volunteers.

I already have concerns about the accountable person and how that role will fit in with those of the managing agent and building safety manager. We are beginning to create a fairly bureaucratic approach to safeguarding leaseholders and tenants, which has the risk of not fulfilling the simplicity and clarity that the Hackitt report required of new building safety measures.

I just think that the arguments cannot be countered. I look forward to what the Minister has to say, but this is such an eminently sensible proposal that I hope that the Government will find ways of bringing forward their own amendment on Report to fulfil the aims of this amendment.

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I thank noble Lords for suggesting this amendment but, for the reasons that I have set out, we are unable to accept it. However, I think that there is a wider question around residents leaning in and taking responsibility for buildings within our leaseholder reform policy and we will give this further thought within government. I offer those noble Lords who are interested a meeting before Report to discuss it further.

[Baroness Neville-Rolfe (Con)]

A meeting would certainly be helpful. We also need to see this famous guidance. We know from other experience on buildings that there is an assumption that everything will be fine and dandy, but this is a very serious problem. We will lose those volunteers who are running buildings right across the country while waiting for Godot and a bit of guidance. If we are able to see the guidance and see that it works, we will be very happy. If it does not work, there will be time to do something. I am sorry to raise this point, but it is a practical matter for lots of people across the country, some of them in very inexpensive flats that they cannot even sell.

[Baroness Scott of Bybrook (Con)]

We absolutely understand the issue We are working on it. As I said, if we have a meeting, maybe we would have some ideas. I do not know about guidance yet, but we will make sure that we can have that discussion. I hope that we will get something better in place before Report.

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We already know there is a shortage of competent fire risk assessors; that was explored on the previous day in Committee. Clearly, these people will not be fire risk assessors. What building safety skills and standards will be required—and who will judge them? The building safety regulator? That would be a good starting point—but, so far as I can see, it is not in the Bill. There are a huge number of issues in relation to the building safety manager, and we want the Minister to be able to answer all those questions. We all want to find a way of making buildings safer, and we have to be convinced that creating this role will achieve that. I am not convinced. We will see what answers we get, and we may have to pursue this further on Report.

[Baroness Neville-Rolfe (Con)]

I hope that the noble Lord, Lord Khan of Burnley, will not mind if I ask for clarification on a related point. First, I will say how much I agreed with the speech of the noble Baroness, Lady Fox, on the worry one might have about a shortage of experts for this purpose, leading to an escalation of costs that will end up with the ultimate consumer: the leaseholder. Clearly, given the history, we do not want confusion in the Bill.

My question is about how the safety manager will operate in practice. How often will he or she be expected to visit the building? Obviously, I know a lot more about shops, and in shops the safety manager is often a treasured member of staff who may not be an expert in safety but is an expert in making sure that other members of the team behave appropriately. You do not need much expertise on safety if you have a very good system—one that includes sprinklers, for example, which will work well because all you have to do is make sure that the sprinklers and the water that supplies them are checked from time to time. My question, which it would be good to have clarified, is: what is the vision of what this person is going to do, and will they be doing it once every five years, once a day, or whatever? That will affect both the cost and the risk that there will not be enough people to do the important job of ensuring that we have safe buildings. Even in high-rise buildings, there will still be quite a bit of demand.

[Baroness Hayman of Ullock (Lab)]

My Lords, I want to say how much we agree with what the noble Baroness, Lady Fox, said about the importance of having adequate safety measures. That has to run through everything we discuss in connection with the Bill. The noble Baroness also raised the important issue of cost. My noble friend Lord Khan talked about high service charges, and the Minister said she would write about that. This debate has put a focus on ever-increasing service costs, and the fact that in many cases they are starting to become unreasonable. It is very difficult when they go up by 190%, as they have in some areas.

The noble Baroness, Lady Neville-Rolfe, asked one of the key questions that I was going to ask, about the operation of the managers. What exactly are they going to do, and how are they going to do it? Will they be paid, and if so, how much? There is not a lot of detail in the Bill. This comes back to the point made by the noble Baroness, Lady Pinnock, about accountability, and whether there will be confusion over the role. It is important that we all understand exactly what building safety managers are expected to do, how they will do it and how they will be rewarded for their work. Without that clarification, there are bound to be concerns that the cost of their work will be passed on through increased service charges, or possibly increased rent. None of that is clear. We would like more clarification about the role and the expectations.

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Perhaps I can encourage the Minister to think about that carefully before we start upsetting people. This Bill upsets quite of lot of people, I know—probably quite rightly—but the real people for whom it needs to meet these standards are those who are in their own homes, have purchased property and need to be protected because they are vulnerable. I do not want any wriggling out to be able to occur here, which is why I make these technical points, not as a criticism but as an observation of how the Bill might need to look at these issues before the next stage.

[Baroness Neville-Rolfe (Con)]

The noble Earl, Lord Lytton, is a great expert on landlord/tenant matters. I agree with him that changes to the leasehold system are not for this Bill; indeed, I do not think that my noble friend Lord Young was suggesting that they should be in it. We have quite enough to do in this Bill. I am grateful to my noble friend the Minister for his description of the new clauses and his willingness to listen, as I think that the new clauses may need some more work.

Like the right reverend Prelate the Bishop of St Albans, I am passionate about consultation, as my record elsewhere shows. Obviously, I am very concerned about bad practice. However, we cannot have a system where an unco-operative resident or two could prevent appropriate safety arrangements being agreed—that is a concern of mine—or encourage the use of too many expensive lawyers, with the cost ending up with the leaseholder.

We also need to think about the enforced requirements for a residents association, as suggested by my noble friend Lord Young in one of the amendments. It may be worth considering in high-risk cases, but it could complicate matters needlessly in some areas.

I shall speak to my Amendment 147 in this group. It would delay the commencement—that is, the coming into force—of the new provisions on the remediation of certain defects and building liability orders until an impact assessment has been published. Noble Lords will know of my passion for impact assessments; I thank my noble friend the Minister for the original assessment on the Bill. I emphasise, with my experience as a civil servant, a business executive and a Minister, that this is not simply a bureaucratic exercise. The discipline of drafting forces the executive authorities to reflect more deeply on the consequences, including the second, third and even fourth-order effects. It encourages good administration and identifies perverse effects and problems. All this matters more—not less—when the measures are ones of great complexity, especially if they are being rushed through.

I have reflected on this further in the light of our important debate on Amendment 24 in Committee last Thursday, 24 February. I have reread it carefully in Hansard, and I thank the noble Baroness, Lady Pinnock, for mentioning that an impact assessment, as well as an Explanatory Memorandum, before Report would be helpful to our debate. As she said,

“blocking developers, even when they have planning consent … is a really radical proposal”,—[Official Report, 24/2/22; col. GC 184.]

and we need to know how it might work and have an impact assessment. We need to understand all those who would or could be affected, including cladding suppliers and manufacturers, architects and surveyors—and, indeed, the planning and building control authorities, which may need to change their practices.

I was struck by the complexity of what is proposed, and the certainty that there will be hidden and unnoticed effects. The right reverend Prelate the Bishop of St Albans, in an excellent speech, was right to point out that any levy paid would inevitably be passed on to consumers and tenants in large part. He was also right to remind us of the chronic shortage of supply of homes in the UK. Indeed, in our report Meeting Housing Demand, the Built Environment Committee found a shortage of homes of all tenures, including social housing. We need to ensure that that does not go backwards, and that the whole building industry, already short of skills and resources, is not needlessly diverted—while, of course, doing the right thing on safety. A decent home is so important to all and we now need to cater for yet more arrivals as a result of the desperate situation in Ukraine.

I was therefore disappointed by the approach of my noble friend Lord Blencathra, who until recently chaired—very well, if I may say so—the Delegated Powers Committee. I believe it is irresponsible to give yet wider powers for bringing in and punishing, or penalising—effectively fining—new groups, when we have not thought through how they might be involved during our scrutiny of the Bill. I am afraid I have the same hesitation about engagement with residents, which is the subject of today’s group of amendments, which include a widening of powers. I regret to say that I think those amendments go too far.

More importantly, all this discussion has reinforced my view of the need for my amendment. I hope the Government will consider it carefully, as it might go some way to assuaging the fears that there may be about the proposals before us, and any decision by the House to widen their application. Wide powers are being taken in the Bill, which will set a precedent for the future. I would like to support the Government in finding a way through, but I would also like to understand the impact.

[Baroness Pinnock (LD)]

My Lords, this group covers three big issues—residents’ engagement strategy, access to properties, and the third part, relating to government amendments, some of which have not been moved today, on construction products and liabilities. My noble friend Lord Stunell will wind up this debate, using his expert knowledge of many of these issues, so I shall restrict my comments to the amendments about residents’ engagement, access and a little bit about construction products.

I completely agree that there has to be a residents’ engagement strategy. One of the learning points from the terrible Grenfell Tower fire was that residents wanted a voice and tried to make their voice heard, but it was not listened to. Their voice may have been heard, but it was certainly not listened to—and it was certainly not acted on.

As the noble Lord, Lord Young of Cookham, has pointed out, there is a big part of the Hackitt report which references the importance of the residents’ voice, and of listening to and acting on what they say. They are the folk who live there. They are the people who daily see what goes on. Their voice must be heard so, whatever else we do, I hope that we will strengthen those clauses about resident engagement. Picking up on the point made by the right reverend Prelate the Bishop of St Albans, we need residents’ associations to do that. We cannot force them to exist, but we can put the onus on the freeholder or the accountable person to ensure that there is some method for the residents’ voice to be heard.

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I make it clear that these Benches very much want this legislation to succeed in its primary objective of delivering safe buildings at no additional cost to their existing occupants. However, we also want to see mechanisms and provisions in place that are realistic and deliverable, where any unintended consequences are clearly identified and then mitigated—or, better still, avoided altogether.

[Baroness Neville-Rolfe (Con)]

Does the noble Lord think this construction product schedule includes such things as wood? The thing about fire safety is that it is not just to do with whether it is a plastic tile of some sort but with where construction products are used. In a case that I am aware of, there is an argument that things made of wood—as they have been for a thousand years—are not safe and should be replaced by something else. I am not quite clear how the construction products link into that. This may be a question for the Minister, but I ask the noble Lord, Lord Stunell, because he has obviously been studying this.

[Lord Stunell (LD)]

The noble Baroness is certainly right that there are materials that have been used in one way, safely and successfully, for thousands of years, and others that are intrinsically safe, such as bricks—presuming they are made of clay rather than straw. I will not try to give the full range, because I think the Committee would get bored quite quickly and my pool of knowledge is quite shallow, but she has raised an important point: it is not just about having a product but about what you do with it. I am sure the High Court would want to put both components together before issuing any building liability orders, which seem to be the nuclear weapon that the Government believe they have in their hands.

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[Lord Greenhalgh (Con)]

My Lords, I was caught mid-sentence so I will go back to the beginning of that particular sentence. The noble Baroness suggests that we require detailed requirements on contravention notices to ensure the proper use of these powers, but that is better suited to regulations. Indeed, the balance between what is reasonable to expect of an accountable person, the urgency of building safety risks and protecting residents from potential misuse of powers is crucial. That is why we believe that this detail should be set out in regulations, developed in consultation with residents and accountable persons and subject to public consultation.

Amendment 52B would allow residents a reasonable time to remedy any alleged contravention before an application to the court; indeed, the Bill provides that the accountable person must specify the steps that the resident should take and a reasonable time for taking them. The court is very unlikely to issue an order before that time has expired.

Amendment 55C would require the building safety regulator to consult on and issue a statutory code of practice regarding powers of entry. Subsequently, Amendments 53B, 53C, 53D, 54B, 55A and 55B would require the accountable person to comply with a statutory code of practice and ensure that the right of entry into homes applies only in urgent cases or emergencies. In respect of Amendments 52A and 54A, the Government are closely listening to these points; however, the noble Baroness’s intention is already being achieved, as the resident would be notified of the application from the accountable person as part of the court process.

I would like to reassure the noble Baroness that there are already safeguards against misuse in this Bill. Under Clause 86, we will prescribe principles under which the accountable person must operate. These have been published in draft and include the requirement to consider the impacts on residents within the building.

In addition, the clause provides that accountable persons have a right of entry to a resident’s home with an order awarded by the court. The courts will apply established principles when considering any such application for entry and will grant access only when they consider it just to do so. This provides an effective safeguard against misuse. As noted in response to the points raised by my noble friend Lord Blencathra, we would expect the accountable person to seek to resolve issues directly with residents in the first instance to gain entry where it is needed.

The building safety regulator will issue guidance to accountable persons, which will set out the expectations for their system for handling residents’ duties and enforcing them. It is important to note that these powers are necessary for the accountable person to be able to discharge the legal duties we are placing on them. Although their use covers emergency cases, access may be needed where a resident refuses to allow the accountable person to discharge their duties. Indeed, the provision is designed for the discharge of day-to-day duties and not for emergency situations, which would require calling the emergency services.

As such, we must again strike a balance between protecting residents and affording the accountable person the tools needed to keep their building and residents safe. We believe that this balance is correctly achieved in the Bill. I understand the noble Baroness’s intentions with these amendments but, for the reasons I have given, I ask her not to press them.

I now turn to Amendment 107A in the name of the noble Lord, Lord Stunell, which seeks to probe whether the retrospective liability provisions in Amendment 107 apply only to higher-risk buildings. I reiterate the points I made earlier when outlining the intent of the Government’s amendments. This course of action will apply to all dwellings and all buildings containing dwellings. The Government’s position is that the ability to recover cost contributions from product manufacturers should not be restricted to those who live in multi-occupied high-rise buildings. While it is true to say that the amount of cladding on lower-rise buildings is likely to be lower, we do not think it appropriate to exclude these just because the building is not as tall. The crucial factor must be the safety risk.

We are not restricting this course of action to buildings over 18 metres because we intend to enable all individuals who have suffered a loss as a result of a dwelling being made unfit for habitation due to the mis-selling of a product, a product being inherently defective or a breach of existing building regulations to seek cost contributions for the losses they have incurred. This course of action protects leaseholders and home owners by ensuring that all construction product manufacturers are held liable for their part in the creation of building safety defects. The broad application of this course of action to include all dwellings reinforces this principle and delivers a proportionate approach. The scope of this course of action to apply to all dwellings will mirror the Defective Premises Act.

Finally, I turn to my noble friend Lady Neville-Rolfe’s Amendment 147. I assure her that the Government have considered the impact on business of the measures I tabled on 14 February. We are clear that the principle of protecting leaseholders is paramount. It is fundamentally unfair that innocent leaseholders should be landed with bills that they cannot afford to fix problems that they did not cause. These amendments will right this wrong, and the Government consider it critical that the provisions take effect as soon as possible. I must therefore ask my noble friend to withdraw her amendment.

[Baroness Neville-Rolfe (Con)]

Are the Government planning to produce an impact assessment on the new measures? My amendment was drafted the way it was on the advice of the Bill clerks, but obviously my main concern is to understand the detail of this promising package.

[Lord Greenhalgh (Con)]

I am sorry; with the sheer length of the debate, we are now approaching the two-hour mark, so I hope that my noble friend will forgive me if I did not address that specific point. However, I did address the point that the Valentine’s Day amendments, tabled on 14 February, were made in haste. The work around impact assessment was therefore not carried out at that time, but obviously we intend to update our impact assessment to reflect all the amendments that the Government have brought forward; that is the good practice my noble friend seeks, I think.

I thank noble Lords for this debate, which has been an important and necessary part of the scrutiny of this legislation. I hope that, with the reassurances given, noble Lords will be happy to withdraw or not press their amendments. This has been a feast of a debate so let us conclude it with the two words that we used to say in our formal hall: benedicto benedicatur.

--- Later in debate ---

That “defect” is singular, so is this per defect or per agglomeration of defects—in other words, does the cap relate to the sum of all remediation works or do different caps apply to individual works? It is this whole process of clarity that needs to be sorted out. I would certainly be happy to sit down with the Minister and other noble Lords to try to work out some of these things and get them straight.

[Baroness Neville-Rolfe (Con)]

My Lords, some very good questions have been asked in this debate. I am grateful to the Minister for setting out his proposals. I rise briefly, as it is late, to say that I very much support two practical amendments; as noble Lords know, I am essentially a practical person. They are Amendment 56 in the name of my noble friend Lord Young of Cookham, on aligning building safety charges and service charges, and Amendment 94ZA in the name of my noble friend Lord Leigh, on the dilemma facing leaseholders who have already paid service charges.

[Baroness Hayman of Ullock (Lab)]

My Lords, I have two amendments in this group. Before I introduce them and talk about the things that we are perhaps not so content with in the group, I just want to say that we recognise that the Government have introduced some very important amendments here. We welcome the work they are trying to do to improve the Bill from its previous incarnation.

The first amendment in my name is Amendment 88. The reason we introduced it is that, looking at all aspects of the crisis that this Bill is trying to address, these Benches are concerned that the Government’s approach does not appear to have a central plan. This amendment was also tabled in the other place by my colleagues, so we are repeating their call for the Government to act across the piece to solve the crisis. We ask that the Minister considers accepting our proposals for a building works agency, which would provide a more hands-on approach.

As we have heard, home owners, many of them first-time buyers, have become trapped in a perfect storm in unsafe buildings because they cannot sell their homes, and are forced to pay thousands in remediation works through no fault of their own. We propose that a team of experts does what the Government have not done so far with this Bill: go from building to building to assess real risk, deciding what needs to be fixed and in what order, using the building safety fund to get those buildings fixed and overseeing the work. Crucially, the Government could then sign off the buildings as safe and sellable, bringing certainty back into the market.

To make it clear, we see the building safety works agency as a separate body to the building safety regulator, with no duplication or crossover; in the debate in the other place, the Minister felt that there was crossover. We see the building safety works agency overseeing the remediation works and the other body regulating. One regulates and one does the work. This would mean that the Government could really take on those who are responsible for creating the crisis and who need to pay. This approach was put in place by a cross-party group of politicians and experts in Victoria, Australia, after there was a serious fire there. That is why we think it would work here: it is not just an idea off the top of our heads but something that has been done and worked before. It would enable the Government really to lead from the front on this matter.

Briefly, my Amendment 125 was tabled before the most recent government amendments. It replicates the McPartland-Smith new Clause 5 from the Commons, amending Part XVI of the Housing Act 1985. Now that the Government have tabled their amendments, it has been superseded, but I will still speak to it to remind the Committee that there have been previous attempts to address the fire safety question during the passage of the Bill. This amendment illustrates that there are different approaches to how the issue can be solved in legislation. It was previously tabled with a range of other amendments addressed to Part 5 of the Bill with the aim of allowing the Government and local authorities to enable grants for remediation work—specifically, by allowing the Government and local authorities to designate dwellings with cladding and fire safety defects as defective.

Having now seen the government amendments, I ask the Minister why the Government could not back the original amendment, which was after all tabled by Conservative Members of Parliament. How did the Government then arrive at the decision to table what they have come up with?

I want now to look at some of the other amendments in the group, and in particular at the implications of government Amendment 92. We do not think that any of the announcements benefit leaseholders who have already paid for remediation work—this has been mentioned by other noble Lords today. The fact that there is no retrospective coverage means that even if the proposed amendments become law and are effectively implemented, many leaseholders will continue to suffer the financial impact of the building safety crisis.

I therefore indicate our strong support for Amendment 131, in the name of the noble Lord, Lord Young of Cookham, which proposes that the Secretary of State set up a statutory public inquiry. It is really important for us to understand exactly what the situation is. Otherwise, there will be no recovery of these costs to leaseholders. Any steps which will lead to full retrospective protection for leaseholders who have already paid remediation costs should be taken seriously by the Government.

If the Government choose to introduce a cap on non-cladding remediation works—the noble Baroness, Lady Pinnock, talked about this extensively in relation to her amendments, and we fully support what she is trying to achieve—it would mean that the maximum amount payable would be a peppercorn amount, which is effectively nothing and is where we need to be. Leaseholders should not be liable to pay for any costs that have resulted from a faulty regulatory system, whether these are related to cladding or non-cladding remediation, or interim safety measures. As the noble Lord, Lord Naseby, said, all leaseholders should be treated exactly the same.

Further, it is unclear who will be liable to pay for remediation costs or the provision of interim safety measures such as waking watch in cases where the £10,000 or £15,000 cap has been met. Many buildings with fire safety issues can be occupied thanks to waking watches and other interim measures. If these are removed, there is a risk that the building receives a prohibition or decant notice and/or a withdrawal of building insurance cover. I hope that the Minister has his thinking cap on, because I have quite a lot of questions and requests for clarification. There have been a great number of amendments to consider and fully understand, so I hope that he will bear with me.

The combined effect of the various amendments is pretty complex. They seem to create what I can describe only as a system of cascading statutory protection, each stage of which is triggered only if the prior one is exhausted. I shall go through my understanding of it. Can the Minister confirm that I am correct or clarify where I have got it wrong? I know that the noble Earl, Lord Lytton, also asked for clarification in a number of areas.

My understanding is that the system would work as follows. First, developers who are still the freeholders of a given building or are linked to it by a subsidiary, as well as cladding manufacturers, are expected to pay first. Secondly, freeholders of buildings who are not the original developers or linked to the original developers are expected to pay second, subject to an affordability test to be set out in the future via regulations. Thirdly, if those freeholders cannot pay, leaseholders will be expected to pay only a capped amount based on Florrie’s law towards non-cladding costs only. Anything they have paid to date counts towards the capped amount. Assuming that I have understood this correctly, I ask the Minister for more clarity on how this cascade system is expected to work in practice and what estimates, if any, the Government have made.

For example, how do the Government expect to define the affordability test at stage 2 of the cascade in regulations, given that this will make a huge difference to the number of cases that then get to stage 3? Why is there no protection for social landlords at stage 2, given the impact on affordable housing supply? What happens if freeholders of buildings who are not the original developers or linked to the original developer cannot pay and the costs exceed the leaseholder cap by a substantial amount? Who makes up the difference? Would it be from the department’s affordable housing budget, for example?

Building Safety Bill

Baroness Neville-Rolfe Excerpts

Committee stage
Wednesday 2nd March 2022 Grand Committee

[Baroness Young of Old Scone (Lab)]

My Lords, I will briefly speak in support of Amendment 120— I will call it the safer-stairs amendment, as I know the Minister likes short names for amendments—to which I have added my name. I will not repeat the excellent evidence and support that has been given by several speakers already.

It is simply to say that this will potentially become more of a problem, because we are all getting older—and we in this House should know that more than anybody else. Also, because of the wonderful feeding and other benefits we have given our children, their feet are bigger. With bigger feet and advanced old age, they will become a complete and utter liability, if we continue to build the poxy little stairs, with inadequate surfaces and terrible handrails, that we see all too often in both public and private buildings. This is something that not only would the Minister welcome, but housebuilders are saying they are keen to get ahead with, but they are not willing to do it unilaterally. Housing providers, both public and social, are keen on it, as are fire chiefs and local authorities. It would not cost any more, is absolutely needed and will be needed even more.

One of the endearing things about Governments—although as a staunch Labour supporter, I find it difficult to think of a Conservative Government as endearing—is when they say, “Yes, that is a very good idea. Let’s just do it”. This is an opportunity for the Government to say that of this Bill now, to avoid deaths, injuries and life-changing circumstances, particularly for older people, which are happening as we speak. There is probably somebody falling down stairs in the House of Lords right now. Minister, if you want us to be fulsome in our praise, put this in the Bill.

[Baroness Neville-Rolfe (Con)]

My Lords, safety has a cost, as the right reverend Prelate the Bishop of St Albans reminded us. We have to decide where we should require money to be spent. I will talk a bit about the electrical safety and standards provisions and then come back to staircases.

I know there is a shortage of electrical experts able to carry out these assessments. Our own electrician, who is very expert, cannot do the assessments we are being asked to provide for social housing and other blocks of flats—for example, my son has a let flat, because he is an academic. The electrician says that he needs to go on a week’s course and, as a busy self-employed person, he does not have time. The lobbying organisation Electrical Safety First, which tried to get me to support Amendments 122 to 124, because I am keen on safety and looking after the consumer, seemed relatively unconcerned about this. Moreover, the amendments are wide-ranging and uncosted. As noble Lords will know, I worry a lot about the shortage of skills in the industry.

These amendments would further jeopardise housing supply, this time including social housing, and leave flats empty. Social housing landlords will be doing this sort of thing anyway post Grenfell, I think. For similar reasons, I am against the wide-ranging Amendment 121.

I am much more relaxed about Amendment 120, especially as it includes a consultation provision. The noble Baroness, Lady Jolly, and I did the Consumer Rights Act together; she is right to think forward to the needs of an increasingly ageing population, which is exactly what this amendment does. We also heard from the noble Lord, Lord Jordan, and the noble Baroness, Lady Young. The huge potential cost to the NHS of accidents in an ageing population is also a very strong argument for action, as we heard from the noble Baroness, Lady Finlay of Llandaff.

This is Committee, so I am sure the Minister will reflect further, but if one can find a way—without imposing significant costs—of making staircases safer, that could be extremely useful.

[Lord Whitty (Lab)]

My Lords, I added my name to the amendment from the noble Lord, Lord Foster, which the noble Baroness, Lady Neville-Rolfe, has just disagreed with. Those three amendments seem to me an essential guarantee of safety for the tenants, leaseholders and others who occupy buildings that are owned by what are broadly social landlords.

The noble Baroness is correct that the normal training of electricians does not include an ability to do this, but that needs to be addressed. I contrast it with the gas situation. Social landlords are obliged to have a gas inspection regularly and, by and large, they do it. Gas suppliers both train their people in that respect—it is an essential element of a gas fitter’s training—and, certainly in my experience of London boroughs, they carry it out pretty regularly and effectively. I do not see why electrical suppliers should not be in the same situation.

As has been said, over half of fires are ultimately caused by electrical faults; most of those are in appliances, but if those appliances are fitted to an installation and a system whereby the defusing mechanism does not work and the fire goes back into the wall and beyond, you have a terrible and inaccessible situation. That is exactly what the more serious fires caused by electrical faults are. There is clearly a responsibility on the manufacturers and retailers in terms of the quality of the appliances, but there is also a responsibility on those responsible for the buildings to ensure that there is a proper inspection of the whole electrical system. That needs to be addressed; it is an anomaly that gas is different from electric. There was a time when the biggest accidents were gas—now they are predominantly electrical. I hope that these three amendments are carried.

On staircases, I agree with the amendment spoken to by the noble Lord, Lord Jordan. I would also say—somebody referred to it earlier—that there are new high-rise and medium-rise buildings that have received planning permission with one staircase and one means of escape only. That is perfectly legal at the moment. It should not be, but I know of at least three examples in London boroughs which have been passed because they say that there are alternative means of escape—in other words, a lift. Most of us are advised not to use a lift in a fire, and it is pretty much built into our psyche, so that is not a sufficient reason. If we are addressing the staircase regulations, for medium-rise and high-rise buildings, two means of escape without involving an electrical lift need to be written in. I support all the amendments in this group.

--- Later in debate ---

We have heard that social landlords are required to keep electrical installations, but this is general and they do not have to hold a valid electrical safety certificate, as private landlords do. I find that disparity quite extraordinary. I appreciate what the noble Baroness, Lady Neville-Rolfe, said about training and numbers of people, but, if you can do it for the private sector, why can you not do it for the social sector? It really needs to come together.

[Baroness Neville-Rolfe (Con)]

We had the tragedy of Grenfell, and I am worried that we are doing a lot of different things in the Bill—some of them are very major—and are now adding on extra things. Individually, things such as the proposals on staircases and electrical safety might have helped to prevent that tragic fire, but each of them has a cost. So it is obviously up to the Minister to look at them in the round and work out what is needed to try to ensure that we have a safe environment. I now support what was said on staircases, because a very good case was made and I am always open-minded, but I am a bit worried about these all piling up and separately chasing the same thing. I have found that, whenever there is a disaster, people come up with several things, and if we had only done some of them 10 years ago we would not have had Grenfell at all.

[Baroness Hayman of Ullock (Lab)]

I appreciate where the noble Baroness is coming from, but I still think there should be parity across the board going forward. Thinking about the Government’s levelling-up White Paper, if we are going to level up, surely parity should be part of that, so that all renters have the same protections.

I will sum up because we still have a lot to get through today. Given the nature of the discussion and the concerns that social housing landlords rarely carry out the certification—the problem is it is not mandatory, so it does not happen very often—I hope the Minister has listened to all of this debate. There is a lot for him to take back to his department.

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[Lord Foster of Bath (LD)]

My Lords, I will try my very best to be as quick as I can, as I have tried to in all my contributions. I began my last contribution with concern about the speaking order of Members. Can I just say that it was particularly disappointing to have to start speaking for this amendment knowing that, already, the noble Baroness, Lady Neville-Rolfe, had indicated she will not be supporting it? I hope that by the end of my remarks, she might change her mind. I give way.

[Baroness Neville-Rolfe (Con)]

I owe the noble Lord an apology. It was my fault for getting it in the wrong order. I have been trying to be on the other Bill as well.

--- Later in debate ---

Moved by

[Baroness Neville-Rolfe]

132: After Clause 133, insert the following new Clause—
“Review of external wall fire assessments
Within 12 months of the passing of this Act, the Secretary of State must review the process used by chartered surveyors for assessing external walls of tall buildings for fire risks, in particular the EWS1 form produced by the Royal Institute of Chartered Surveyors, and must lay a report before Parliament.”

[Baroness Neville-Rolfe (Con)]

My Lords, I move Amendment 132 in my name on the subject of external wall fire assessments. I did not speak on energy efficiency as time is short, although I was Energy Minister five years ago; I look forward to discussing the opportunities and frustrations informally.

Noble Lords will know that external wall assessments have been a serious problem aggravating the difficulties that leaseholders have experienced in the post-Grenfell world.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I am sorry to interrupt. The Minister has had to leave to deal with a pressing personal matter. Can I ask for a five-minute adjournment?

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[Baroness Neville-Rolfe (Con)]

My Lords, as I was saying, the Committee will know that there has been a serious problem aggravating the difficulties that leaseholders have experienced in the post-Grenfell world. This is because insurance companies and mortgage lenders have required these external wall assessments to be made and the dreaded EWS1 forms to be filled in before transactions can proceed. However, not only are the assessments expensive—or they were—but the requirement to provide them implies, or implied, a very cautious view of the needs of fire safety in particular. Worst of all, there has been a crippling shortage of RICS professionals to carry them out.

I argued during the passage of the Fire Safety Bill that this process was over the top, as sometimes happens with professional-based regulation, and increased the numbers of unsaleable properties post Grenfell by hundreds of thousands. I was therefore delighted to hear the Valentine’s Day announcement of the Secretary of State, Michael Gove—in addition to the January comments quoted earlier by my noble friend the Minister —stating that:

“The provisions will protect leaseholders and encourage a more proportionate approach to fixing buildings. Currently, building owners can simply pass all costs on to leaseholders, with no incentive to hold back on unnecessary remediation work that has brought misery to leaseholders. Today’s package, alongside the duties in the wider Bill, will create an environment for tough, proportionate action on critical safety issues while preventing cost inflation and excessive work.”


“Today’s package” sounds good to me. However, I remain a little sceptical, knowing just how bad the gold-plating has been. For example, we were right to agree earlier on the need to be proportionate about balconies, as the noble Baroness, Lady Fox of Buckley, argued.

The purpose of this probing amendment is to invite my noble friend, who is of course the Minister at the Department for Levelling Up, to update us and agree to undertake a review of the situation in 12 months’ time. The review proposed would focus on the tall buildings that are in scope, but the whole sector would benefit from a review that assesses the position of smaller buildings as well as the interests of the consumer rather than just the surveyor—in this case, the leaseholders and property owners affected. I add that the right reverend Prelate the Bishop of St Albans asked me to say that he supports this amendment but had to be elsewhere. I very much hope that my noble friend will look sympathetically on this request, particularly given the helpful change of approach by the Secretary of State.

[The Earl of Lytton (CB)]

My Lords, I will probably disappoint the noble Baroness a little, but I hope that I can also give a bit of explanation. I say that with particular feeling because she chairs the Built Environment Committee, on which I have the privilege to serve.

I understand the irritation that has been generated in some quarters by the EWS1 scheme. I ask the Committee to bear in mind that this was prepared as something of an emergency measure to deal with the logjam of unmortgageable, and therefore unsellable, properties. It was set up at the instigation of government and occurred following discussion with insurers, lenders and valuation professionals. It is a creature of common creation and not the RICS alone, although the RICS put it out. That is quite important.

The unfortunate thing is that, as it was the only form of certification around, it has been latched on to in certain quarters as providing some reassurance for things that it was never intended to achieve. In other words, it was seen as something with a wider fitness for purpose than was ever intended, and that is part of the problem.

When one produces something of this sort, it is produced in collaboration with others, but there will always be people across the spectrum; the insurance world is such that certain sectors of it will top-slice the risk. There will always be some that—a bit like some of what I might call the more adventurous motor insurers—will insure only certain clearly de-risked parts of the market in risk generally. I do not know whether that is a problem here.

This EWS1 was just reviewed in December. The RICS—again in consultation, and again, I believe, with support and collaboration from government but certainly with all the relevant bodies—decided that even though its application in terms of the problems that it created was reduced to a very small proportion, it should be kept because that was the view of valuers, mortgage lenders and insurers. The RICS as a professional body cannot ignore what these people are saying or the commercial pressures that are set before it in dealing with that. The RICS also published its justification in December, which is available on the web. I am all for de-risking things so that assessments of all sorts do not grow horns and a tail. However, I am not sure that having the Government take control and ownership of this particular matter would necessarily reassure lenders or professionals or, for that matter, benefit the market sentiment.

In its evidence to the Levelling Up, Housing and Communities Committee, the RICS acting chief executive made it clear that there is already a process in hand to train up a cohort of fire risk assessors pursuant to the Bill’s objectives. EWS1 itself is probably destined to wither on the vine in a relatively short period of time. I therefore hope that I have given some sort of helpful explanation of why I am not sure that it is a good thing for the Government to take on this thing, even if they felt that they were willing to get their fingers involved in that particular pie, and why it is probably best that the matter continues on the critical path it is now and we see the outcome of this cohort of newly trained people. I am sure that other professional bodies will need to do training as well; we must try to make sure that it is rolled out as speedily as possible so that, hopefully, the problems will be put behind us.

--- Later in debate ---

[Lord Greenhalgh (Con)]

My Lords, I thank my noble friend Lady Neville-Rolfe for her amendment. It has been a fascinating debate, with lovely Latin phrases which I am sure have been worked on all afternoon using Google Translate.

As the Government have made clear, it is important that we restore a sense of balance and proportionality to fire safety. We must ensure that fire risk assessments of external walls do not require unnecessary work and reduce the risk aversion we have seen in the sector. The department has already taken steps to ensure that industry takes a proportionate approach to the assessment of the external walls of buildings and I can reassure my noble friend that we will continue to work with industry, including lenders and surveyors, to keep under review the process used to assess external wall systems.

The noble Earl, Lord Lytton, mentioned that we have been tracking the data from mortgage lenders and it is available on the GOV.UK website. I have been looking at my Apple iPhone—I have given the brand away, but I do not know how I could have coded that without using the brand name—and the vast majority of mortgage valuations for flatted developments do not require an EWS1 form. The trend is also going down. I think the most recent data in January was that around 8% of mortgage valuations require an EWS1, so 92% do not. That is down from 9%. My department estimates that 492,000 leaseholders in residential buildings of 11 metres and above do not need to undergo an EWS1 assessment for their building for them to sell their property or remortgage. It is important that we continue to work with mortgage lenders to track how that is evolving over time. These things take time, but the trend is in the right direction.

The Government are also making preparations to launch a professional indemnity—or PII—scheme, targeted at qualified professionals to enable them to undertake EWS1 assessments where otherwise they would not be getting PII cover. A condition of PII coverage under the scheme will be that EWS1 assessments are carried out in line with PAS 9980. An audit process will be in place to monitor compliance to the standard.

I thank my noble friend for raising this important matter. She has absolutely championed that the Government get to grips with some of these points. I think we are making progress on a number of fronts now. I assure her that this work is of critical importance for the Government. We will continue to work closely with industry in the coming months to ensure that. I therefore ask that she withdraws her amendment.

[Baroness Neville-Rolfe (Con)]

My Lords, I thank my noble friend, particularly for giving the figures. Before Report, it would be good to have the figures for the non-high-risk buildings as well, because one of the concerns I had was that the industry was requiring people who were not caught by measures following Grenfell to have these EWS1 assessments. It was a probing amendment and I will reflect further in light of what has been said. It was a very good debate.

There is confusion and concern about the logjam, and we need to make sure that we have the support of the industry professionals who are needed to do this. Things can take a long time in the building industry, as I think we will hear when we debate retentions. I certainly did not want to lock horns with the noble Earl, Lord Lytton, who is such an excellent member of the Built Environment Committee, but to make sure that we had this debate and that we really do sort this issue, as I know the Government have said that they wish to. I beg leave to withdraw my amendment.

Amendment 132 withdrawn.

--- Later in debate ---

Having spent most of my education studying Latin and Greek, I have been deeply embarrassed during this debate by my inability to find a suitable Latin or Greek quotation to match those quoted by many noble Lords. The only one that I could come up with was “Nil desperandum”, or “Never despair”. Many small construction firms do despair at how retentions hamstring them from achieving the performance that they aspire to, in terms of quality, safety and productivity. I cannot say that I expect the Minister to answer their prayers today, but I can of course say, “Dum spiro spero”—while there is life there is hope. I beg to move.

[Baroness Neville-Rolfe (Con)]

My Lords, I added my name to this amendment, although I am not sure whether it made its way on to the list. I support the great work of the noble Lord, Lord Aberdare, in his quest for a resolution on the subject of retentions—that is, the retention of part of a contract cost.

The noble Lord may recall that, when I was a Minister during the passage of a motley business Bill about six years ago, I promised that a review would be undertaken by the then DHCLG. At first blush, the arrangements seemed wrong and unfair to me, from my experience of the building industry. Somehow, delivery has been extraordinarily slow. It would be nice to have my ministerial promise delivered, albeit somewhat late, by St George here. I very much hope that the Minister will do the right thing and accept this modest proposal for a long-overdue review or whatever else might be agreed between now and Report, with the ever-energetic and nil desperandum noble Lord, Lord Aberdare.

[Lord Stunell (LD)]

My Lords, the noble Lord, Lord Aberdare, has certainly been energetic, forthright and determined on this issue, and rightly so. He has reminded the Committee that the Hackitt report made it clear that the withholding of money from second-tier, third-tier and fourth-tier contractors and suppliers put pressure on them, which made it much more difficult for them to deliver a proper and effective product or job on site. The downward pressure that they faced as a result of the withholding of that money was a major problem for them as functioning entities. That was the view expressed in Hackitt, based on the evidence that had already emerged from the Grenfell inquiry.

Of course, there is much wider evidence around the country. The collapse of Carillion is an example. I think that £140 million of retentions were held by Carillion and thereby lost from those on lower tiers in the pyramid. Whatever else might be said about it, that put a number of companies at risk of going out of business, and indeed a number of companies did so just because that money was lost to them. The evil impact of this is very clear.

Some of the impact is less clear but just as difficult. Such companies find that they do not have the resources to invest in skills, training and continuing professional development, simply because they do not have that cash in hand. So it has an impact. Under

“Matters which the review may consider”,


the noble Lord, Lord Aberdare, has sensibly listed in his amendment three important ones and then put “(d) other factors”. I would add investment and training as one of the other factors that suffer as a result of this.

I want to remind the Minister that it is government policy that all government contracts should be written in such a way that retentions are not in place. Unfortunately, not every government department has read the memo. I asked the Business Minister, the noble Lord, Lord Callanan, a Written Question and subsequently an Oral Question about how that was progressing. He was quite frank in admitting, and it is on the record, that the Department for Education had so far refused to implement the Government’s overall guidance that all public procurement should be without retentions built into the contract documents. I have no doubt that the noble Lord, Lord Callanan, is having a good go at the education department; I hope that I can add to that today and another Minister will have a good go at it, at the very least to make sure that the Government get their own departments to follow their own policy, which would be very much in the direction that the noble Lord, Lord Aberdare, is advocating. I have probably said enough, but I certainly hope to hear good words from the Minister in a moment or two.

Building Safety Bill

Baroness Neville-Rolfe Excerpts

Lords Hansard - Part 1 & Report stage
Tuesday 29th March 2022 Lords Chamber

[Baroness Finlay of Llandaff (CB)]

My Lords, I am most grateful to the Minister for meeting me and the noble Baroness, Lady Jolly, yesterday, and for sharing the correspondence that he had had over the Building Regulations Advisory Committee. He explained why it would be easier to update a statutory approved document than primary legislation, and the need for such statutory regulation to be reviewed rapidly and changed as things go on.

I endorse what has been said by others who have spoken, in that there is an urgency to this. Around many parts of the UK at the moment, we see what is almost an explosion of housebuilding and of other building sites. It would be really tragic if the Bill went through but those buildings do not have staircases in them which are fit for the population who are going to use them, and if we do not see a real drop in accidents in these new buildings. The old housing stock is obviously really difficult and much of it has inappropriate staircases, but we are talking here about new build. Because of that, there is an urgency and I hope that, when the Minister responds, he gives us a really good and tight timetable.

[Baroness Neville-Rolfe (Con)]

My Lords, as a former retailer, I have a good deal of sympathy with Amendment 254 in the name of the noble Lord, Lord Foster. I agree with him that there is a gap here with online material posing a risk to safety, which is not the case with normal retail sales. In summing up, can my noble friend the Minister give us a bit more confidence as to when that gap will be filled? The Government are often too slow.

In that vein, I very much welcome the progress made by my noble friend the Minister on staircases, which are the subject of Amendment 262. I agree that the approach outlined by the noble Baroness, Lady Finlay of Llandaff, seems to make sense and allow us the opportunity to get on with this consumer issue as well.

I share the concerns underlying Amendment 264 from the noble Baroness, Lady Pinnock. There is a real problem of shortages in the built environment workforce, as highlighted in the Built Environment Committee’s report on demand for housing—a committee on which several Members of this House sit and which I have the honour to chair. However, to be honest, the amendment is overcomplicated. The direction of travel is right but I am doubtful that we should accept an amendment in this form.

On Amendment 261, of course we need improved homes; cold homes are very bad for health, as has been shown by many studies. However, this is an uncosted proposal. It will have huge compliance costs for homeowners—admittedly, over a reasonably long period—and I really do not think that we are in a position to add it to this Bill today.

[Lord Stunell (LD)]

My Lords, I will speak to Amendment 264 in my name and that of my noble friend Lady Pinnock, which would require a report on the built environment industry workforce that takes into account various factors. I assure the noble Baroness, Lady Neville-Rolfe, that this is very much a probing amendment; we certainly do not intend to press it today.

However, we need to give this issue an airing. The whole pyramid on which this Bill is constructed depends on that bottom level: the workforce who will deliver it. We know that there is a grievous shortage of fire risk assessors, not least because the fire risk assessor who assessed Grenfell Tower was an unqualified, off-duty firefighter who made up the qualification letters that he put after his name when he applied for the job with the tenant management organisation. That evidence was given in phase 1 of the Grenfell inquiry.

We know that the Government have made strenuous efforts to get fire assessment training going but there is every indication that there is not enough and that, when this regime comes into force—we all want to see this as soon as possible—there will be a shortage of fire risk assessors. Earlier today, wearing his fire responsibilities hat via the Home Office, the Minister made the point that one of the jobs in the fire and rescue service is to upskill staff to gain the competences they need to fulfil their functions of realistically assessing risks and remedies in the duties they undertake. We think that there needs to be a clear plan for developing training for and upskilling the people taking on the new roles in this Bill. There is a whole series of new posts, including accountable persons and responsible persons—not to mention the safety regulator staffing itself—and we need some assurance that the Government are clear on all of them and have a laser-like focus on producing the answers that are needed. This is against the background of an industry that employs 2 million people, has 90,000 sole traders operating on the ground and in many ways, as we have discussed, has a dysfunctional contracting model. It certainly has low productivity and very poor standards of delivery of outcome.

The amendment may or may not be over-elaborate. I hope that it would be a work plan that someone is working on, even if it should not be in the Bill. I really want to hear the Minister give an account of how a work plan such as this is in fact going forward. If not, we will certainly be snapping at his heels over the coming months. Much more seriously than that, he will find that there will be the gravest difficulty in implementing the Bill, which is what we all want to see, on the shortest possible timescale.

I am the resident pointing at the hole in the road and saying to the contractor, “Please come and fill in this hole”. That is what this amendment is about.

Building Safety Bill

Baroness Neville-Rolfe Excerpts

Lords Hansard - Part 2 & Report stage
Tuesday 29th March 2022 Lords Chamber

[Lord Blencathra (Con)]

I support Amendment 233, so ably moved by my noble friend Lord Young of Cookham in his usual erudite way; he had the detail but was still succinct. Because he set it out so well, I can be commendably brief, for a change.

I start from the position of my right honourable friend Michael Gove, and I totally support what he has said and done. I usually support what he says and does, except when he was Conservative Chief Whip and was a bit cuddly, caring and too kind. But apart from that, I liked it when he said that

“leaseholders are shouldering a desperately unfair burden. They are blameless, and it is morally wrong that they should be the ones asked to pay the price. I am clear about who should pay the price for remedying failures. It should be the industries that profited, as they caused the "problem, and those who have continued to profit, as they make it worse.”—[Official Report, Commons, 10/1/22; col. 284.]

You cannot say better than that. So I am rather sympathetic to any amendments, including the one moved by the noble Earl, Lord Lytton, trying to make sure that developers or perpetrators pay every penny. It should not be leaseholders and, ideally, it should not be the taxpayer.

However, this amendment creates a remediator of last resort and allows the Secretary of State to step in and undertake the works. In either case, it would allow the Secretary of State or the local authority to pursue the responsible developer with debt claims to recover the money laid out on remedial works. As my noble friend so ably said, that ensures that there is a failsafe mechanism in the law. The Government’s legislative proposals do not tell us what will happen if remedial works are simply not started or cannot be completed as a result of the effect of the caps imposed in the Bill and the restrictions on buy-to-let landlords.

The duty in this amendment would fill the gap. The Government’s proposals would require some sort of remediator of last resort. Because they are imposing caps on what can be collected toward non-cladding costs, the Government are creating a gap in funding, which will have to be plugged somehow. Ultimately, someone is going to have to pay; otherwise, as my noble friend said, buildings will never be fixed. This amendment allows building work to be started and buildings to be fixed, with the taxpayer providing a form of bridging finance—but they must get that money back from the building safety fund; this is not carte blanche to make the taxpayer pay for these things.

As I said, I am sympathetic to the amendment from the noble Earl, Lord Lytton. I just worry that if we adopted these four or five new clauses, we might be tearing the guts out of the Bill and would have to rewrite a lot of it. But I think his heart is in the right place in where he is aiming to go. I understand that my noble friend might be worried about the legal position under the ECHR. This is another area where the noble Earl’s amendments might technically fall foul of the ECHR. Some of us have seen legal advice circulated from Daniel Greenberg, who is well known to everyone in this House. He says:

“On the basis of this analysis, l am satisfied that the draft clauses are compatible with the Convention rights and that Ministers will be able to comply with Section 6 of the Human Rights Act 1998 (Acts of public authorities: duty not to act incompatibly with ECHR) when they come to perform the functions conferred by the draft clauses”—


referring to draft Clauses 234 to 237.

I am not capable of suggesting whether Daniel Greenberg QC is correct or not, but I would love to hear what the Minister has to say about that. If the amendments from the noble Earl, Lord Lytton, are not right, it would be helpful to hear from my noble friend how far they can go towards what the noble Earl is trying to achieve. If he is going to reject them, I would love to hear how far he can push to get as close as possible to the noble Earl’s position. With those words, I am content to support my noble friend’s Amendment 233, and I would love to hear explanations on the noble Earl’s amendments.

[Baroness Neville-Rolfe (Con)]

My Lords, I apologise for a brief Committee-style intervention, given the novel nature of the group of amendments we are looking at. I have two points.

First, I am very grateful for the agreement earlier to the amendment from the noble Lord, Lord Best. I thank my noble friend for that but, as he knows, I am concerned about the position of leaseholders who are also involved in the hard task of managing even a small development as an enfranchised leaseholder. I have a family member with an interest in that area. What happens if a cladding or other building safety issue arises? I know that such leaseholders may face big bills and responsibilities. Amendments 186 to 193 appear to make enfranchised leaseholders of this kind liable even if they have ceased to act or sold out and become previous landlords. Have I understood this correctly? If I have, then it undermines the case for enfranchisement that has been encouraged by successive Governments to get rid of excess service charges.

Secondly, a strong case has been made for the non-government amendments in this group. I too have received many worrying letters from leaseholders. Do we have a feel for the cost, especially the net cost, of these Back-Bench amendments we are debating? I feel this is a matter that will be of concern in the other place, given current fiscal pressures, and might therefore determine what is eventually agreed in this important and urgent Bill.

[Baroness Hayman of Ullock (Lab)]

My Lords, this has been a very interesting debate so far. In the interests of time, I will just speak to the two amendments I have in this group, and then I will be very interested to hear the Minister’s response to the broader debate and issues that have been raised, that were clearly also debated in Committee.

Amendment 231 is about a registered social landlord not being able to

“use the income from rents or service charges to rectify defects relating to external wall systems or compartmentations where those defects result from the construction of the property or the installation of the external wall systems.”

The amendment would prevent local authorities using rental income or service charges to pay to remediate dangerous cladding or other fire safety defects. The aim is to give social housing tenants the same protection as leaseholders. While we support the Government’s efforts to protect leaseholders from the cost of remediation, the arrangements currently being considered by Ministers will mean that the cost of remediating social housing blocks falls on housing associations and council housing revenue accounts.

In the case of council housing, the main sources of income within the HRA are from tenants, in the form of rent and service charges. If the cost of fixing council housing falls on the HRA, then either rents, service charges, or potentially both, will need to increase, or maintenance improvement of social housing as well as new social housing delivery will need to be cut back. That is our concern. We clearly support the protection of leaseholders, but the protection of home owners who will eventually make a profit from the sale of their property, cannot and must not come at the expense of social housing tenants. Our proposal would prevent that outcome and instead require the Government to protect tenants such as leaseholders by requiring the industry to pay, with the taxpayer as a fallback provider of funds in recognition of any failings that created this crisis in the first place.

We discussed my Amendment 22 in Committee. It states:

“The regulations must exempt any relevant application made by or on behalf of a registered social landlord for the provision of social housing as defined under section 68 of the Housing and Regeneration Act 2008.”


The purpose behind this is to make social housing providers exempt from the additional financial burden of the Government’s proposed levy in order to prevent council tenants effectively subsidising the failures of private developers. Clause 57 of the Building Safety Bill gives the Secretary of State powers to impose a new building safety levy in England. This will contribute to government costs for remediating historical building safety defects and will apply to developers making application to the building safety regulator for building control approval. This is the new gateway 2 system, which will be introduced in building regulations.

--- Later in debate ---

[Baroness Fox of Buckley (Non-Afl)]

Your Lordships need to calm yourselves.

On Saturday, I went to visit my home in Wood Green. It looks like a bomb site: there is no roof and there are huge amounts of scaffolding and barbed-wire fences surrounding the block of 25 two-floor maisonettes. When you arrive, you see a huge multicoloured fluorescent sign with the words “Zero tolerance” and then a list of prohibited activities, all relating to safety: “Safety helmets must be worn”; “Safety footwear must be worn”; “No smoking”; “Danger: tripping hazards”; “Danger: men working ahead”; “Danger: no children on the site”. We are told that “Safety signs and procedures must be observed.” I therefore know, having visited my home in Wood Green, that Haringey Council is definitely keen on promoting safety.

Let us consider this. My home is in this state because, two years ago, there was a fridge fire in one maisonette. The roof of the block caught fire and the other flats, including mine, were drenched by the fire brigade in putting out the fire. It was not too bad and, to be honest, we were so glad that no one was hurt and we were relieved to get out safely. But that was two years ago this month—two years in which 25 families have been effectively homeless. As a leaseholder, the council, which is my freeholder, took my front door key off me—it is not a glamorous house, by the way, but it is mine, or so I thought—and basically said that I would get it back when the block had been made safe. It is now two years later and I am still not back, and I have no idea when I can go home.

I have mentioned this story before. My retelling it is not therapy but to show how what starts as an unremarkable but unpleasant event—a fire, albeit in lockdown—can escalate and turn into a nightmarish, never-ending misery for so many people. At every turn, as leaseholders and tenants, we have been faced with layers of bureaucracy getting in our way, more and more people to deal with, more and more issues being raised to explain why we are not returning home, and dwindling effectiveness in getting our homes back to us. We leaseholders and council tenants have been shown a certain indifference to our plight. If I am honest, all that has been much worse than the original fire, but it is okay because Haringey Council has put up lots of safety signs. Safety trumps all, and is used to say to us, “Shut up and put up.”

I arrived at this place during the time of my eviction from the house and was inspired by the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Pinnock, whom I heard speak on what was happening to leaseholders. I thought, “I’m going to join that debate.” I was inspired by their dedication and what they said, and that is how I ended up here.

The moral of this tale is that I want to make sure that the Bill, which is well-intentioned on safety, does not in the name of safety end up with the unintended escalation of a whole new set of problems for leaseholders, which was the point of the analogy with my flat fire. The amendment—I actually prefer a similar but better amendment from the noble Baroness, Lady Neville-Rolfe, who is trying to do the same thing—would require the Government to commit to review the impact of the legislation in a couple of years. It says to the Government, “Can you just check in all instances that the legislation doesn’t cause more problems and is actually doing what you want it to do, or what we in the House have been told you want it to do?”

We are rather rushing through the Bill. Whole swathes of new amendments have emerged. These have been put in not necessarily by noble Lords but by the Government. I was happy to hear the Minister explain that there are so many amendments because he, the Secretary of State and the department are listening. But whatever way you look at it, we, as people scrutinising the Bill, are being presented with hundreds of amendments that have been quite hard to get one’s head round in the time. In many ways, the Bill is not being fully scrutinised line by line. As the noble Lord, Lord Jordan, put it, it really is a legislative quagmire to wade through and it is very difficult.

It has been almost impossible to read the amendments, assess what their nuances mean and look for what the consequences might be. I appreciate that that is for me and that I am a lay person on technicalities, but luckily, as has been mentioned, leaseholders have a few important voluntary heroes who have helped the rest of us through. I know that the lawyer and leaseholder Liam Spender has already been name checked for his multicoloured sheet, which has already been shown, but if noble Lord have not seen it is well worth studying because it really does explain things. There are also all sorts of reporters for the Leasehold Knowledge Partnership and intrepid leaseholders doing their own work, trying to get to grips with what all these new amendments and the Bill mean.

I mention that because it would be irresponsible if we passed this Bill and then let it sail off into the distance without any idea that it will be looked at again. I worry that the Government think that all will be solved once the Bill has passed. I do not want hostages to fortune. We have had lots of reassurances today, we have been told not to worry and have had great rhetoric from the Government on proportionality and common sense, but we therefore need to be able to check that that rhetoric will be fulfilled.

Finally, this is not all about leaseholders. My hunch is that the Bill has a range of problems because it has gone along uncritically with the picture painted by Dame Judith Hackitt that somehow every aspect of living in a flat should be seen as a potential hazard and a dangerous fire risk. For the last few years—understandably because of Grenfell—there has been a sort of hyperactive “something must be done” mentality that has led to the EWS1 crisis and caused many of the issues that informed the discussion on the previous group of amendments on innocent victims paying for excessive remediation.

All I ask is that this review checks that an overzealousness does not emerge from the legislation that skews priorities and means the Government’s valiant efforts at common sense and proportionality somehow end up in a proliferation of chunky formalised procedures.

I will also reflect on the other people we should bear in mind. I have emphasised leaseholders throughout this contribution, but in my Second Reading speech I also talked about the construction industry. I want to make sure we do not end up stymying the house-building programme through overregulation. There is a danger that, as we have heard in some of the contributions, we describe the construction business as though they are all cowboy builders, which is a rather insulting caricature. With another hat on, at another time, I would be saying the big crisis in this country is a lack of housing and we need to “Build, build, build”, so I get worried when the Home Builders Federation says that it is concerned that there will be difficulties with housing delivery if too much of a burden is put on housebuilders. You might say, “I am not going to feel sorry for them,” but we do not want to get ourselves into a situation where the extraction of funds from the construction industry means that the UK home building industry—which is important to many parts of levelling up, social equality and so on—is stymied.

One way or another, I can think of nothing more sensible for a common-sense Minister than to say, “In a couple of years, we’ll review all this and check that your hunches are wrong, Lady Fox.” That will be fine. The Minister referred to me earlier as Oliver Twist—always wanting more. This is only a little bit more, but you cannot change the world unless you want more, and I intend to demand a lot more, but only a little more in this Bill. I beg to move.

[Baroness Neville-Rolfe (Con)]

My Lords, I rise to speak to my Amendment 264A in this group. I thank my noble friend the Minister, as others have done, for all he has done to make this Bill a reality.

The object of the Bill, as I see it, is to get defects remediated to a proportionate extent as quickly as possibly—mainly cladding, sometimes installed, ironically, to improve insulation in the interests of carbon reduction, but also other unsafe matters. There have turned out to be more defects than anticipated and we have witnessed an unfortunate record by builders and others of not doing enough to put matters right. The Bill seeks to get things remedied quickly. However, it is costing an eye-watering amount to home owners, leaseholders and the Exchequer, and the Bill therefore also seeks to establish an equitable share-out of the costs including appropriate contributions by the supply chain.

It is a long saga and some of us in this House have been seeking solutions for a very long time and welcome the principle of legislation. However, unusually, the Bill has been changed completely by government amendments tabled since it left the House of Commons, yet we have not had an updated impact assessment to help us assess the costs and benefits of the revised proposals. This is poor, given the financial and other burdens on different stakeholders, as the noble Baroness, Lady Fox of Buckley, has just explained. However, as the chair of the Built Environment Committee I welcome today’s concession from the Minister on social housing, which I hope will be less costly, as it will give welcome clarity.

I have a great deal of respect for the Health and Safety Executive, as I have said before, and for the Minister who has fought so hard to present credible, effective and sensible proposals. However, it has been a rush, and I believe we must have a review clause in the Bill beyond the five-year independent review in Clause 152, and with more teeth. The noble Baroness, Lady Fox of Buckley, has constructively proposed one option; I hope my version may recommend itself to colleagues across the House and to my noble friend. I believe that agreeing to this could help to narrow current, very real, differences on the Bill particularly in the next group of amendments.

I will explain why. I am proposing a review within two years. It would look at the impact of the provisions of the Act. If the review found that there were serious problems for leaseholders, for home owners who could not buy or sell property, or for any other group, it would make recommendations.

--- Later in debate ---

As the right reverend Prelate the Bishop of St Albans has pointed out, that flat might not be worth £1 million, and I think that is a really important issue not to forget. This has also been raised by Stephen McPartland, an MP in the other place, and I think it is a general issue. I would like the Government to consider looking again at this valuation of houses for caps.

[Baroness Neville-Rolfe (Con)]

My Lords, there are many amendments in this group, and I have concerns about the open-ended financial implications while it remains unclear who is responsible for a perpetrator who cannot be found, or who is beyond the reach of the law—thus the importance of the review that the Minister has, I believe, agreed to bring forward much sooner than five years’ hence, although, without my amendment, he would need another Bill if we have to make changes, which seems inevitable.

There have been many powerful speeches, not least from the right reverend Prelate the Bishop of St Albans. I will not repeat what has been said. I have, however, given my support to Amendment 123, and I would like to take the opportunity to commend my noble friend Lord Naseby who in Committee highlighted the unfairness of excluding buy-to-let premises from the safeguards in the Bill for reasons we have heard. The Government have acknowledged that he was right.

However, I agree with my noble friend Lord Young of Cookham that it is difficult to limit this arbitrarily to the ownership of two extra UK properties. I would prefer his formula of four properties, or some other, fairer system. He and others have worked so hard to get the various provisions of the Bill right. For example, he said that we may not have capped the liability of enfranchised leaseholders—which he and I have worked on together—as we had been led to believe in Committee.

I look forward to my noble friend the Minister’s reply on the rationale and an answer to all the good points that have been raised, particularly on enfranchised leaseholders and how we do buy-to-let fairly.

[Baroness Hayman of Ullock (Lab)]

My Lords, this has been an extremely important debate in which we have covered some of the critical issues still outstanding in the Bill. I thank the Minister for the introduction to the amendments. Many of them are good, but we believe there are still problems that need to be sorted out.

I will be brief. I thank the noble Earl, Lord Lytton, for his introduction to Amendment 115. If he decides to divide the House, he will have our support on that amendment.

I turn to my Amendment 155. It is really important that we take account of the principle that has been referred to by other noble Lords: there should be no cost to people who have done nothing wrong. It is not the fault of leaseholders that they have been left with these huge costs. We believe it is desperately unfair to force them to pay a penny, which is why my amendment has the word “zero” in it. As mentioned by the noble Baroness, Lady Pinnock, we must not forget the strain on the mental health of leaseholders. They need clear and proper support, and they are relying on your Lordships to do the right thing by them. To me, this is a moral question. Should leaseholders pay costs that, for many, will still be huge despite the caps proposed by the Government? They are blameless; they should pay nothing.

I thank the noble Lord, Lord Marks, and the noble and learned Lord, Lord Hope of Craighead, for clearly laying out the legal position. It has been important for me to hear that from them, and the detail that they have provided, having had discussions with the Government on their concerns about the ECHR. I also thank the noble Lords, Lord Young of Cookham and Lord Blencathra, and the noble Baroness, Lady Pinnock, for their support.

I confirm that I intend to divide the House on Amendment 155. If it fails to pass, I will be happy to support the noble Lords, Lord Blencathra and Lord Young, on Amendment 158.

Building Safety Bill

Baroness Neville-Rolfe Excerpts

Consideration of Commons amendments
Tuesday 26th April 2022 Lords Chamber

[Lord Blencathra (Con)]

My Lords, I apologise to the House for missing the first two minutes of my noble friend’s magnum opus; the last business went slightly faster than I had anticipated. I declare a personal interest as a leaseholder in a block of flats that may contain some non-cladding works that may require remedial treatment.

I have to praise my noble friend the Minister yet again for the tremendous changes that have been made to the Bill since it came from the other place. I also congratulate my right honourable friend Michael Gove on forcing all the big building companies to sign up, including bringing the Galliard Homes horse kicking and neighing to the water, although he will need to ensure that it and the other companies actually drink the water—they will throw millions at lawyers to weasel out of what they have signed up to.

I am told that the owner of Galliard Homes, Stephen Conway, has accused Michael Gove of acting like Al Capone and the mafia. My respect for young Gove increases by the minute. Conway had an estimated worth of £270 million in 2015; imagine what he is worth now. It seems to me that the owners of the big building companies have made their billions by being a bit more ruthless mafiosi than Michael Gove ever was. However, that is for another day.

Despite the excellent progress on the Bill, there are still some gaps. I regret that we do not have anything specific in the Bill protecting enfranchised leaseholders. All Governments have encouraged leaseholders to buy out the freehold. Those who have done so are still exactly the same as other leaseholders who have not, and they should get the same protection. I welcome the consultation but I hope it is speedy, and I hope that, if legislation is necessary or this can be done by regulation, that is brought in as quickly as possible.

I acknowledge that the Government have increased the number of properties qualified under buy to let, but in my opinion they have not gone far enough. As a small buy-to-let owner said to me, why does the Bill support with cost-capping a billionaire oligarch non-dom with two buy-to-let leasehold flats in Mayfair, valued at millions, yet leave completely exposed a pensioner buy-to-let leaseholder with a small portfolio of just four flats? These people are not big landlords. Although nothing can be done in this Bill now, I hope something can be done in future.

Nor am I happy that we are planning to reject buildings under 11 metres. They may not be as big a risk but they are unsellable. When an estate agent or lawyer tells prospective buyers that the flat they have looked at has some dangerous cladding—but not to worry because you will probably get out in time if it burns down—I do not think that they will find many buyers. These flats are simply unsellable.

Finally, I disagree with the removal of “zero”, and like the Opposition’s amendment of £250. I do not accept that the government caps set a proportionate balance, as was said in the other place by my right honourable friend Stuart Andrew MP, who was also an excellent Deputy Chief Whip in his time. As Michael Gove said, no leaseholders should pay a penny for any remediation works. We heard impeccable legal advice in this House from the noble Lord, Lord Marks, and a former Supreme Court Justice, the noble and learned Lord, Lord Hope of Craighead, saying that making leaseholders pay in order to avoid an ECHR challenge was misguided and wrong. As the noble and learned Lord, Lord Hope, said, the challenge will happen in any case, no matter what level the Government set the cap at, and those building companies will try it on.

If Motion H1 succeeds today, I do not want the Government in the other place to take on the role of the wonderful Ukrainian Snake Island defender, Roman Grybov, who offered sexual advice to the Russian warship. We are not the “Moscow”, and I hope that the Government will bring forward a compromise amendment, perhaps higher than £250 but much lower than the government caps.

With those quibbles, I wish to congratulate my noble friend yet again on the massive progress he has made with this measure. “One more heave”, as Jeremy Thorpe said in 1974—but hopefully with a bit more success.

[Baroness Neville-Rolfe (Con)]

My Lords, I have been living with this matter since we first debated the Fire Safety Bill in 2020. I declare an interest as chair of the Built Environment Committee. I believe that the building industry has an important part to play and has tried to rise to the table in the current circumstances. The Government, and my noble friend the Minister in particular, are to be congratulated on all they have done to find a way through on cladding, but the measures legislated for are inevitably costly and should not, in my view, be legislated for in respect of buildings under 11 metres, as proposed in Amendment D1.

I have some news for my noble friends. Since Michael Gove’s Statement on 10 January about proportionality and common sense, the logjam in buildings under 11 metres has eased. I have experience of this, relating to a family leaseholder in a nearby village, where there is now a less absolutist and more flexible approach to fire safety in a block of homes; this has become apparent in recent weeks since the changes were made. I believe, therefore, that there is a limit as to what we should provide on a contingency basis. I do not believe that taking the proposed powers, as now suggested, is justified. I think that the situation is improving in relation to buildings under 11 metres, and we should welcome that and see how that approach can be progressed.

I end by thanking my noble friend the Minister for the progress that has been made. Obviously, there are horrific problems, right across the board, in relation to taller buildings and cladding. Howeever, I urge people to be a little careful in bringing into the legislative framework, without looking at all the details, a very much larger number of homes.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, like everybody else, I think it has been refreshing to be in a situation whereby the debates in this place have been listened to and changes made. On a number of other Bills, one has not had that feeling—but in relation to this we definitely have.

I want to emphasise the key issue of buy-to-let leaseholders. They can be presented as big landlords, but I remind the Minister that many people were advised that investing in property would be an important way of being sensible and would provide them with an income or a pension and so on and so forth. So people did this in good faith. They are not landlords. They are leaseholders; they just have more leasehold flats. They are not big business. They are being treated differently if they have a small portfolio of four properties. This needs to be looked at, because it feels wrong that such people should be punished.

Secondly, I am very mixed about the 11-metre question. I agree that the danger of an unintended consequence here would be to say that, if you paid the remediation for under 11 metres, everybody would rush out and start remediating under 11 metres when it is not necessary. I am delighted to hear the Minister’s pledge, which I hope we will keep him to, that anyone having a problem with a building under 11 metres can get in touch if they are being charged. However, there is the problem of sales, and people feeling that they have unsellable flats; the noble Lord, Lord Blencathra, mentioned this. That is the approach I want to feel that we leave this Bill with: that leaseholders can come to the Minister with these kinds of problems that are unintended consequences.

I was one of the people who was very enthusiastic about having some kind of ongoing review—although we did not go down that route. The unintended consequence of what has in the end been a bit of a risk-averse panic over the past few years—which I understand—is that everything is seen as a fire risk. This has led not to keeping people safe but to making people very poor and not solving the safety problem. Let us hope, therefore, that things such as consultations and these kinds of questions will be taken seriously, because one thing I have heard consistently from leaseholders is that, although there is a lot of talk about listening to leaseholders and tenants—we heard that post Grenfell; we all know that Grenfell residents had tried to raise issues but were ignored—they still do not quite feel that they have a way of having a voice. That is an important thing for the Minister to carry on with.

I support Motion H1, because I want to push the Government one last time on this question. Ultimately—this is a very important point—the number is small but, on principle, we just want to be in a situation where the leaseholders are not paying. That is really what is being argued here: leaseholders, who were always the innocent people in this, should not pay.

Finally, because I think this can get lost, I have tried to represent the voices of at least some leaseholders—particularly those from Tower Hamlets, where I know the Lib Dems in particular have been brilliant at raising all these issues. It is an area where there are more problems around the leaseholder question than anywhere else, but greater remediation; I have been really inspired by that.

I also remind noble Lords that I want more houses to be built. This is a huge, important part of levelling up or whatever it is. We just need more houses built. I have always been concerned that we do not do anything that ends up destroying the construction industry or having the outcome that no houses are built—risk aversion in housebuilding. Part of what has happened is that people now understand the downside of being a leaseholder. Even if you are building those houses, you now think, “Why would I buy a leasehold flat?” I can assure you that, if I ever buy a flat again, after I have sold my leasehold flat—I am going to get rid of it as quickly as possible—I will not then want to buy a leasehold flat. I just think it is too scary.