Building Safety (Remediation of Unsafe Cladding etc) Bill (Second sitting) Debate

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Department: Ministry of Housing, Communities and Local Government
Florence Eshalomi Portrait Florence Eshalomi
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Q Kate, you touched on your members having access to the Government building safety fund. Obviously, that was not the situation before; what difference do you think that makes in terms of them undertaking the critical safety works that are so desperately needed?

Kate Henderson: Equal access to remediation funding, brought in last year at the spending review, is hugely welcome. It has made a big difference to our ability to deliver remediation at pace and to invest in existing homes and development. Previously, our members—housing associations—and councils had to self-fund remediation, which diverted resources away from new homes and refurbishment. Some of our members even had to sell buildings to pay for remediation work. Members are now actively applying to the cladding safety scheme and receiving funding. We are expecting starts and completions of remediation by our members to begin to increase as we get the approvals. Homes England will be able to provide more data on that.

Funding from the cladding safety scheme also funds things such as project management, which is really important to deliver remediation faster. It frees capacity within our member organisations to build new affordable homes and improve existing ones. I should say that the funding only covers external wall defects; members are still facing significant costs for internal walls, including compartmentation and fire doors. We very much welcome the cladding safety scheme funding for high-risk buildings, and new funding has become available for buildings under 11 metres that are also deemed high-risk. That opened earlier this year, and we understand that that fund for buildings under 11 metres is massively oversubscribed. It would be really useful to have the data from those applications to understand the scale of works required in high-risk buildings under 11 metres.

In the sector more broadly, there are lots of other significant changes happening. We absolutely support Awaab’s law and welcome the clarity in the decent homes standard, but recognise that those measures all add cost. Remediation funding that we have access to very much helps to meet those competing demands and makes them more manageable, but the overall financial picture remains complex and has its challenges.

Sarah Gibson Portrait Sarah Gibson (Chippenham) (LD)
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Q I will put this question to both of you; please answer as you see fit. Is it a shortcoming of the regime that building owners, who will have the financial incentive to minimise remediation costs, will appoint and pay a fire risk assessor? We heard this morning that lack of independence and lack of consistency in assessments may be part of the issues of delays and leaseholder confidence. I wondered if you had any thoughts on that.

Jaclyn Mangaroo: That is a really good question. In some cases, it may be. We have seen it most often with the pledged developers where they are using a contractor that may be part of the organisation, and so are marking their own homework. For a responsible entity where it is an enfranchised building, or where an RMC or an RTMC has the opportunity, they have really no incentive to say that their building is safe when it is not. They have very little incentive to do that. They really want to go much further.

The regulation of the profession will certainly help to improve competency, and hopefully it will speed up the process and reduce delays, as long as that auditing of the fire risk assessments can be done quickly through Homes England. We are all about making sure that there are fewer delays, that stalled buildings can get started and that residents have peace of mind. There is no deadline. There is no set date for when buildings will be finished, so making sure that we get peace of mind, confidence and protection of residents into this Bill will be so important. That is how we have approached our written evidence to the Committee: does it speed things up, does it provide clearer accountability and will it actually give residents peace of mind and create safer buildings?

Sarah Gibson Portrait Sarah Gibson
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Q Have you seen problems where an assessor has been employed and is part of the firm that owns the building?

Jaclyn Mangaroo: I do not know of any particular cases of that. It is more when there is a pledged developer involved. I cannot comment specifically on any other cases.

Kate Henderson: From our members’ perspective, we have already been working really hard to deliver the duties that will become part of the Bill: for example, assessing buildings, mitigating risk, applying for funding and carrying out remediation works. We welcome the introduction of the remediation compliance plans as a way of demonstrating transparency and accountability to enforcing bodies, but also of demonstrating accountability to residents. Having clear plans and timelines will help ensure that expectations are managed, that any delays are addressed quickly, that enforcement action can be taken against bad actors and, in exceptional circumstances, that the backstop can be used to secure a route to remediation.

We welcome standardisation of the fire risk assessments of external walls methodology and the intention that every building be assessed and remediated to the same standard. As I have mentioned, the PAS 9980 methodology has already been used to access funding to the cladding safety scheme. I have also mentioned that we have mixed experience of assessors using PAS 9980 and that it can be subjective. Having a national audit system run by Homes England with a feedback loop will be really welcomed by the sector. I should also say that alongside auditing, as you have mentioned, having regulation of the competence of risk assessors as part of the introduction of a single construction regulator will help to ensure that recommendations are consistent and of good quality. That will provide assurance and transparency to all involved, particularly residents.

Sean Woodcock Portrait Sean Woodcock (Banbury) (Lab)
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Q Kate, as you know, I worked in social housing for nearly 15 years before entering this place, including at the time that the Grenfell tragedy took place. I think it is fair to say that that was a big shock to the sector and led to a lot of soul-searching by organisations. My experience was that a really mixed range of expertise and capacity across the sector was shown in the response to that, let alone to any legislation coming down the pipeline. Are you confident that the sector is now in a position to implement this legislation, and is there more that would help in the implementation of this Bill?

Kate Henderson: There is nothing more important than residents’ safety, and I can assure you that our members have safety as their utmost priority and responsibility. We are already delivering a huge number of aspects of remediation work that will be covered by and become statutory duties in the Bill, and we welcome that. This legislation is only one piece of the response to the tragedy at Grenfell Tower. There are other pieces of legislation, but in addition to that, a huge part of this work is around culture. It is around learning, accountability and the relationship between residents and their landlords.

As part of that, in a couple of weeks’ time we will be launching a suite of tools for our members—a Grenfell Tower reflection toolkit. This is about learning lessons from the inquiry. It is a suite of resources for board members, executives, operational levels, large organisations and small organisations, making sure that this is not just about physically replacing cladding, but about listening and acting on the information being provided by residents, having appropriate assurances in place, and making it culturally at the heart of who we are as organisations.

On whether we have the capacity to deliver these new requirements, we are already doing a lot of it, but the capacity of the overall system is not us alone. We rely on expertise, fire risk assessors, contractors and the capacity of the Building Safety Regulator. A lot of work is happening on all those fronts, but everybody is going to have to work harder. We are going to need a lot more people and a lot more expertise. We are really pleased to see the leadership of the Building Safety Regulator drive forward the pace of assessments to gateway 2. We are seeing improvements there. That needs to continue, and we are committed to working with all involved, including Government and particularly residents.

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Sarah Gibson Portrait Sarah Gibson
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Q Going back to your concerns about assessments and suchlike, did you feel that one shortcoming of the regime is that some of the building owners will have a financial incentive to minimise the costs of the remediation, and to appoint and pay their own fire risk assessors, and therefore you will get inconsistencies in the results and a lack of standard and control over those assessors and those assessments?

Giles Grover: A lot of this is about control. On that point about building owners, yes, there is obviously going to be a conflict of interest. We have seen that. If you step back, we have had a shifting position from the consolidated advice note. It essentially says, “Remove and replace everything”, which again was probably going to be impossible. We need to get towards a proportionate approach, as they call it. Some people want proportionality, because they want to be able to move on with their lives. Other people are very worried about their permanently high insurance and so on carrying on.

A lot of this is about the operationalisation of the PAS and the tolerability. It is that control. It is about making sure that, if you have a risk assessment that comes to certain conclusions, even the Government’s own advice about understanding quality on the FRU says, “You need to make sure that conclusions are based on evidence”. There are so many assumptions: “Is that continuous? It’s probably not continuous behind the scenes. Let’s not worry about it.”

The Building Safety Act put leaseholders at the back of the queue, but a lot of what it did, unfortunately, opened the way for freeholders, developers and everyone to start gaming the system, blaming each other and saying, “Okay, it is a relevant defect; it is not a life-critical fire safety defect. It might be wear and tear actually”, which means we have to pay for it. There is too much buck-passing and shifting around, so yes, that is an issue, but again, it goes back to the fact that the way that the use of the PAS and the FRUs have been operationalised without the assurance, particularly the developers and contractors. That is a major concern of ours. I could go on, but I probably do not have time.

Sophie Bichener: Building owners over the past 10 years and before have shown that they are not willing to do the right thing and make sure that they appoint the right people to get to a decision on these homes. They have had plenty of time and opportunity to do that, and in many cases they have not. Many buildings are owned by pension funds, for example, which bought them as a sustainable investment, and they have a duty to their pensioners to keep costs low. I think they probably want to make the buildings good and sell them on at a profit if they can, so there is a real financial interest to narrow the scope of the works and get it done as quickly as possible.

Sarah Gibson Portrait Sarah Gibson
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Q Is the PAS 9980 use of the word “tolerable”, which is rather vague, detrimental to the clarity that you are seeking?

Giles Grover: We have been saying this since before it was even introduced: it is all about what “tolerable” means. Again, I understand that we need something about proportionality, but so many different fire engineers will have so many different opinions and views. If something is deemed tolerable, whether it is a building that requires works or does not require works, there must be assurance and proper audits to ensure that the conclusion is based on tests and evidence.

If I am being honest, we have been through 20 or 30 years of just a lot of rubbish being built. Now everyone is saying, “Residents, leaseholders and shared owners are at the heart of this”, but they are still doing all they can to avoid liability, including financial liability. We are the ones trying to battle for answers, and we are sadly just going around and around in circles.

Sarah Coombes Portrait Sarah Coombes (West Bromwich) (Lab)
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Q End Our Cladding Scandal has been an incredibly strong advocate for leaseholders across the country. Although I am the MP for West Bromwich, one of my constituents was a leaseholder in a building in east London. The building was built in 2016, but it was found to have cladding and dangerous safety issues, and it then burned down. The residents were made homeless and it was very scary for them. They were forced to continue to make mortgage payments on non-existent homes, and the freeholder then went into administration. That shows not only the horrendous safety issues, but the nightmare financial scenario for lots of these leaseholders.

One of the things that residents often call for is greater certainty about what is happening to their buildings and when, particularly what remediation work will be done and over what timeframe. What value is there in requiring those responsible to set out the steps they will take and, critically, the timetable for remediation? What are your thoughts on that element?

Giles Grover: Every single leaseholder and resident needs to understand what is going on in their building and how long it is going to take, but they also need an independent route to raise concerns. The system has been designed in such a way that, even with the developer contract and the cladding safety scheme—which is doing sterling work, but in a very constrained system—a lot of it still relies upon us having to go to the managing agent or a freeholder for answers.

I have one person in a building who went to the RMC, which said, “Go to the developer”; but the developer said, “Go to the building safety regulator”, and the building safety regulator said, “Go to MHCLG.” They had to fill out a correspondence web forms, but they got a stock answer that said, “Go back to your freeholder.” Yes, people need to be put at the centre of it.

There is the ability to include dates and timescales, but they actually need to be monitored, overseen and enforced, with consequences and penalties at the end of it. That way, it is not just a case of saying, “Oh, it’s the BSR and the regulatory capacities; okay, fair enough. Oh, they’ve had to do more FRUs.” The problem is that the system still allows too much to rely on those self-interested actors making those decisions. They will all tell us that safety is at the heart—but we are actually watching their actions, not their words, and they still are just not good enough.

Sophie Bichener: It is really hard to force people to communicate correctly with leaseholders. A lot of the time, freeholders are saying, “We are communicating”, but for the leaseholders, the communication says, “We’re trying really hard to fix this at pace.” Our members never have a clear picture of whether that means next week or in five years’ time. I have actually never really seen any comms about my building that give me any timeline or confidence that anything is happening.

I think it would be really hard to mandate communication that involves leaseholders, but it absolutely has to happen in order to give leaseholders any confidence that their homes will be safe and that, if they want to try to move on, move out or sell, they can get information on when the timelines for making their building safe will fall into place, and they can then feel a bit more confident not only about where they live being safe, but about, “How and when can I move on with my life?”.

Giles Grover: I should try to be positive again, because I am possibly being a bit too negative. Homes England has built stipulated communication points into its cladding safety scheme, so there are certain points of the process where you have to upload it before you get more funding. That is completely sensible; it actually looks at the quality of it and makes sure that it goes to the right people. Again, the developer contract is the one where it is about ticking a box that just says, “I am communicating 100%, so everything’s fine—see you later.” We need more consistency across the piece.

There are ways to do this, and that is what we have been trying to say for the last two and half years. We can actually simplify things, put people at the centre and save money. Sadly, we have not quite got to that point yet.

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Florence Eshalomi Portrait Florence Eshalomi
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Q On that, do you agree that we should prioritise the safety of residents in existing buildings over new builds?

Ben Hopkinson: Yes. There is definitely limited capacity within regulators, so we have to figure out where that capacity gets us the biggest safety improvement. Given that existing buildings are less safe than new buildings, they should be the priority for the BSR or a similar regulator.

Sam Dumitriu: I agree with that; I am happy to accept completely what Ben says.

Sarah Gibson Portrait Sarah Gibson
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Q Would either of you have a view on whether the considerable flexibility in PAS 9980, and its term “tolerable”, has caused issues around the competent person scheme? Is part of the concern that people are not sure exactly what the criteria are for what they should and should not be doing? Is the term “tolerable” creating inconsistent standards in fire assessment, which is adding to the delays?

Sam Dumitriu: There is a trade-off between prescriptive and more flexible regulation. Sometimes you might like to have very clear rules, even if they err very far on the side of caution. I think that in the case of building safety, what we have had is a few pieces of Government guidance in the past that have probably been too tick box and restrictive, and that has caused problems. I think that the approach of PAS 9980 is the right one in focusing on proportionality. I also support the position in clause 44 on tolerable risk.

As mentioned, it is very important that we prioritise the types of remediation that happen, because there are very large constraints in terms of who can deliver and assess these projects. As a result, you need some way of making sure something is proportionate and remediation is not necessary in every case. It can be very costly and that work can also potentially push other projects back in the queue.

The area of policy that I have spent the most time focusing on in recent memory is the regulation of nuclear power, and Ben has also raised the Fingleton review. We have some very similar issues here because it is a question of “health and safety principles”, “reasonably practicable” and terms like that. You tend to see regulation that errs on the side of caution—which in safety is understandable—but there can be a tendency to do work that is not 100% necessary.

In the case of building safety, one consideration around external cladding is that you often might have a building owner who has financial interests in the cladding being remediated that are not solely safety related. There might be a different cladding material that requires less maintenance, is more resistant to weather or might make the building nicer. If there is a potential safety case, what you do not want is a situation where that cladding is changed even though we are pretty confident that, in the event of a fire, everyone can be safely evacuated—the building might experience some damage, but ultimately the people inside the building get out okay, which is what we really care about. My instinct is that we do not want to move to a system that requires more work being done over what is proportionate. It is really important when we look at all of these things.

I think that in the Building Safety Act, in many cases, we have erred on the side of regulation beyond what is proportionate, particularly around second staircase rules for buildings above 18 metres. I think that it could very easily be raised to 30 metres without providing any real risk to the public. We need to be very cautious about insisting on things beyond what is proportionate.

Ben Hopkinson: “Tolerable” seems to be the right standard in the Bill. There is a completely understandable drive for caution and safety within these complex issues. However, we have to be careful about proportionality. Already the Bill’s impact assessment shows that the costs of it are 10 times higher than the benefits. If you removed tolerability and mandated complete safety, how expensive would that be? Would we accidentally shut down new construction because we are burdening house builders with incredible asks on development capital?

There are a lot of competing issues here and tolerable seems to strike the right balance. Certainly, you want to make sure that the kind of buildings that are most unsafe are the ones that are remediated first, and removing a tolerable guideline risks buildings with only minor imperfections being treated exactly the same as the ones with the most dangerous cladding. I think that the Bill, as drafted, seems sensible and obviously we will look at the regulations as to how “tolerable” is actually defined.

Sean Woodcock Portrait Sean Woodcock
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Q I want to come back to something that you said in response to Gareth Bacon. You said that we have made “good progress” on removing cladding. Of those buildings identified, 40% have had it completed while on 45% no work has started, with the remainder still having work done. That is really important, because it comes to the central point of why this Bill is here. Do you stand by that as good progress when 45% of buildings identified as having unsafe cladding have had no work started on them at all?

Ben Hopkinson: The fact is that there has been good progress—although it is not perfect and it is not done yet. I think that the Bill is useful in contributing to the remaining cases that are outstanding. Certainly, having 40% or 45% of homes completely remediated already is, I think, good progress being made. I did not say that it was done.

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Sarah Gibson Portrait Sarah Gibson
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Q Do you think it is a shortcoming of this regime that the building owners, who will have a financial incentive to minimise remediation costs, will appoint and pay the fire risk assessors? Do you feel that fire risk assessors have enough standards and controls placed on them to make sure their reports are robust?

Alexander Cook: We support the standardisation of the FRAEW methodology and the recent changes to that for the “tolerable” risk changing as well. We will always see subjectivity in fire engineers’ opinions. The auditing by Homes England will hopefully control some of that. There is always more that could be done in terms of charters and control of fire engineers. I think the more the industry has, that will help.

There are a lot of examples where we have had conflicting fire engineers’ opinions in both directions, increasing and decreasing scope, but they are independent of Vistry, so they are not controlled by us. They are appointed, but they follow their own charter’s ethics and morals and set the scope outside of any other interests.

Sarah Gibson Portrait Sarah Gibson
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Q Do you think that all fire assessors should be part of a unified body that is chartered and therefore has a code of conduct like other professional organisations?

Alexander Cook: Yes. I believe there are chartered fire engineers out there, and that makes sense for them.

Sarah Gibson Portrait Sarah Gibson
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Q But do you think all fire assessors should be part of that?

Alexander Cook: I think fire engineers should be, as they are now. Improvements could always be made in terms of the fire assessors, and that could be done through the Bill, with guidance on clarifying those roles, especially for FRAEWs.

Darren Paffey Portrait Darren Paffey
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Q You mentioned a number of the blockers earlier. I do not know whether you were referring to individuals and organisations or processes and so on. I am just wondering what your view is on things like clause 8’s duty to remediate, clause 14’s duty to prepare a remediation compliance plan and clause 29’s duty to co-operate. Would those things, taken together—and with the entire Bill as it currently stands—deal with some of the blockers that you had in mind? Is it about process or is it about “unwilling” and “unco-operative”?

Alexander Cook: There is definitely no “unwilling”. Everyone wants to remediate and they want to get to the same goal. People want to co-operate, but it is not necessarily about co-operating; it is about their response times. When so many parties are involved, maybe changes to the Bill could introduce a stricter turnaround time from responsible entities, and that might introduce acceleration. For us, one of the particular delays and blockers is where you have fire engineers, lawyers and responsible managing agents taking a little bit longer to get through all of those before they actually get a response. When you multiply that by the hundreds of buildings, it soon adds up. The changes to the Bill will help, but I think there is still a way to go.

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Florence Eshalomi Portrait Florence Eshalomi
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Q Steve, you mentioned that you welcome some elements of the legislation. Do you believe that the proposals to go further in respect of construction product manufacturers will address and reinforce the issue around polluter pays?

Steve Day: Yes, I did not actually say it, but it was another element that I was happy about. The cladding manufacturers largely have escaped liability. I do not know if you followed our campaign with the Earl of Lytton in the House of Lords. We initially had a remediation scheme, which was trying to make developers pay for breaches at the time of construction with a wide construction industry levy, which did bring in construction manufacturers. That aligns with our approach, but there are some areas where you could extend the levy. The build-to-rent sector, for instance, has largely escaped it. They could contribute, given that they are building. Build to rent would be an area.

Before the Committee, we had a look at the latest status of developers and house builders. The top 10 have £24 billion in net assets, largely due to hoarding land banks and making significant returns to shareholders. We looked at just how much were share buybacks and dividends. For instance, Barratt Redrow has announced an intention to return £400 million to shareholders. With £24 billion plus £400 million, they can afford to pay a little more to cover all these leaseholders. On the buildingsafetyscheme website, you can see a breakdown of all the information that I am giving here, including the items of the mortgage-backed securities—we are going to publish those so that everyone can see the exposure due to bad building in this country.

I really encourage the Committee to look at whether freeholders may evade their responsibilities. There have been certain restructuring events that you might want to consider, which may mean that you have a good bank/bad bank scenario as we had at Lehman Brothers, where some assets may be transferred to the bad bank, and then there is no money to pay the remediation liabilities. I would recommend looking at anti-avoidance measures, potentially as an amendment to the Bill.

Sarah Gibson Portrait Sarah Gibson
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Q You mentioned something that I questioned earlier about the PAS 9980 use of the word “tolerable”, and the fact that that ambiguity can have an effect not only on the safety of the building in terms of your concerns about the materials staying in, but on the wider housing market in terms of mortgages and insurance.

My worry is that we have seen poor construction and a race to the bottom over the last 30 years in the UK construction industry, and now the Government are hoping to build large amounts of new housing. How do we make sure that the housing that we are building now will not be the retrofits of 2050, and that we will not be in the same position then? What key things do we need to be doing to make sure that this does not happen again? Is it a question of building control? Is it a question of enforcement? What do we do to make sure that we do not end up here again?

Ian Abley: It is a question of regulation 7. You already have the tools to do it. They are adequate. Building regulation requirement B4(1) said that the external walls should be adequate to resist the spread of fire. That is still the case. The definition of “adequate” is the thing that is missing. But that forces you into a world of very straightforward thresholds of what is and what is not safe.

The problem with tolerability, to my mind, is not so much that it has not collapsed into a low. If the high and medium-risk buildings that already exist are declared as such to the Building Safety Regulator, they have to go through building remediation, which puts them back into the building regulation loop. The structure of PAS actually encourages anybody with a medium or high-risk building who cannot afford to remediate to shop around and find a fire engineer who will give them a “tolerable” report, and they magically get to avoid the building regulation process entirely.

Regardless of David Crowder’s intent for setting up a structure that looks vaguely like something that the Health and Safety Executive would do—with the carrot of risk going from unacceptable through tolerable and down to acceptable—what PAS does is encourage remediation avoidance. Any impecunious building owner is going to find it far cheaper just to employ a fire engineer who will give them a “tolerable”. I have seen that on an epic scale with a signatory to the developer remediation contract.

It is a beautifully connived process where everyone seems to be doing their job, but all that happens is the risk gets accepted by the building owner and then the process stops. The estates of buildings fall off the statistics, and it looks like the remediation problem is not as big as was first thought. If clause 44 mandates the tolerability wheeze into the legislation instead of defining “adequate”, you will see that right the way down to the 11-metre height.

Sarah Gibson Portrait Sarah Gibson
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Q Is this therefore an issue with fire engineers, fire assessors and the control of their competencies and accountability, or is the issue with a standard that is not clear about the assessment itself?

Ian Abley: As Giles Grover said, you need a technical standard that is the legally minimum adequate of what is requirement B4(1). Why would you employ an incompetent fire engineer to give you a rubbish report? The builders who have the money will employ the most competent fire engineers who will use their skill, knowledge and experience, but their behaviour is another thing—they are just acting like mercenaries.

Steve Day: We are seeing that at Royal Artillery Quays. You have one fire engineer saying, “It is safe to leave these panels on,” without caring about justifying it with evidence, which he puts in his report, and another two fire engineers saying, “These are dangerous. The are banned on new buildings for a reason.” The building owner just chooses which report they want. We spent £4,300 of our own money on this—that is how much we cared about getting the right opinion—only to be met with a terse email saying, “Sorry, we don’t have to listen to you because of PAS.” That is the problem we have.

We have to do the two reforms on the buildingsafetyscheme.org website. Please look at those, because they are what the country needs, and they are what the banks, lenders and insurers need. You cannot put this back in the box; the insurers and lenders will not let the Government do it. You need to protect all leaseholders, you need to deal with building regulations breaches at the time of construction, and you need fire performance test evidence to know the risk of leaving things on and, otherwise, to take them off. Only leave them on if you have evidence—that is the rule. If they did that, we would have safer buildings. We are not remediating buildings to a permanent state, either, because of the rolling remediations. These are big issues that we need to resolve.

Ian Abley: Could I make a point about the insurers? Building regulations are not about property protection, and they never have been. PAS 9980 is not about property protection. The insurers have their own standard, which corrected the error of class 0, once they had worked out that it was an error and the inquiry had come to a conclusion, and it adopted James Brokenshire’s standard. The insurers cannot ignore health and life safety, which is all the building regulations have to achieve. The insurers only want Brokenshire’s law for life safety. They do not need anything else for property protection, because there is nothing else. Brokenshire’s law was reasonably practicable and low risk. PAS 9980:2026 itself recognises Brokenshire’s law as low risk. It does not actually name it; it just copies and pastes the text.

The PAS has avoided one of the other aspects of building requirement B4(1): it only deals with the combustibility of the walls and the compartmentation and cavity barriers around windows. It does not deal with the conflagration problem of radiant heat from one building to another, so it cannot claim to be building requirement B4(1). As far as I can see, PAS 9980 was written as a way to undermine James Brokenshire’s law when the calls for proportionality came in, because people were bleating that James Brokenshire’s law was too onerous. It is not. It is the reasonably practicable thing to do for life safety.

Steve Day: The problem—I will not say too much, I promise—

Sarah Gibson Portrait Sarah Gibson
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I probably ought to bring it to a halt, because I am conscious of the time.

None Portrait The Chair
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There are no further questions from Members, so I thank you both for your evidence.

Sarah Gibson Portrait Sarah Gibson
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If that is the case, Chair, I am quite happy for Steve to finish his statement. I was just conscious that if someone else was trying to come in, we were running out of time. Sorry, Steve. I did not mean to interrupt you.

Steve Day: Thank you. I really appreciate that.

Ian Abley: If not, I had a question for the Minister.

Steve Day: Do you mind if I just do mine?

None Portrait The Chair
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Order. Ms Gibson, have you finished with the question?

Sarah Gibson Portrait Sarah Gibson
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I have, yes.

None Portrait The Chair
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Okay. We will have to move on, because there are no further questions from Members. Thank you both very much for your evidence.

Examination of witness

Dame Judith Hackitt gave evidence.

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Florence Eshalomi Portrait Florence Eshalomi
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I will leave it there because I am mindful that other colleagues want to come in.

Sarah Gibson Portrait Sarah Gibson
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Q Thank you, Dame Judith. I am very interested in your response to the concerns about PAS 9980, on which I have to say I sounded a bit like a stuck record earlier in the session. Concentrating on the issue of trying to get remediation through more quickly, and the level of technical competence, do you feel that the discrepancies in fire assessments that we heard about earlier—where one fire assessment by the building owner says everything is fine and the independent assessment by the leaseholder says it is not—would be solved by the suggestions that you made to Mr Bacon in respect of clear guidance on what tolerance means, or do we need greater control and accountability, and perhaps regulation, of fire engineers and fire assessors themselves? Is it a problem with the assessment and the criteria for the assessment, or is the problem a lack of accountability by those carrying out the assessments?

Dame Judith Hackitt: The part about fire engineers’ competence and how we assess that is being addressed separately from the Bill. We already know that there is more work we need to do there, and I am involved in that.

Let us be clear, however, that we are never going to get to a point where fire engineers always agree on a single solution, because the nature of the beast is such that different solutions may be arrived at that give an acceptable level of risk. That is one of the reasons why we have focused on making all the regulation outcome-based so that it gives people the opportunity to look at different routes and so on.

In the cases where disagreements occur, it is really important to have a body that can stop that becoming a long-term delaying process and a dispute through the courts, and focuses on agreeing what is going to be done, getting it done and letting other things play out while speeding up the process whereby residents get to a position where they can both feel safe in their building and, indeed, sell their properties and move on if that is what they want to do.

Olivia Blake Portrait Olivia Blake (Sheffield Hallam) (Lab)
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Q Thank you, Dame Judith, for your work in this area over many years and for your appearance today. I want to ask you a bit more about that issue. You have described quite well what should happen, but could you describe what needs to change so that can happen, and so that responsibility for making existing buildings safe leads to action rather than the repeated discussion that you outlined?

Dame Judith Hackitt: I am not here to suggest for one minute that we should copy everything that has been done by Cladding Safety Victoria in Australia. However, when you look at the series of measures that it has put in place, there is a lot that we can learn. I have already talked about the agreed risk framework that everyone buys into. In addition, to speed up the process, it arrived at a mechanism whereby, when people cannot agree on what needs to be done, progress is not slowed.

Progress still takes place: the Government pay for it, but they take over the right from the building owners to recover costs from the parties who are held to be responsible. The Government are therefore acting in the intermediary space, not as the funder for work that others fail to do. It is a model that we could learn from, of that I am convinced.

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Florence Eshalomi Portrait Florence Eshalomi
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Q Obviously, a number of people purchasing properties are not going into it as building, cladding and material experts. We are trying to legislate to identify the most dangerous form of combustible material on buildings. Do you feel that the Bill as it currently stands provides a sufficient definition of unsafe cladding and related defects?

Dr David Crowder: Again, I have not focused my interest on the Bill; I am concerned with the PAS. Currently, the Bill simply refers to the PAS, and the PAS gives a definition of whether a building is safe in terms of the risk of external fire. I know it is not for me to ask the questions, but I suppose there is a question to put back to those writing the Bill: are you seeking simply to limit the ability of any square metre of external wall to burn—to reduce its propensity to burn at all—or are you looking in the round at whether the people in the building are safe, in spite of the possibility of some fire spread?

This is where tolerability comes in. A number of public consultations have occurred around what people are content with. Let us start with buildings that comply with the building regulations as written right now, and buildings that have solid masonry wall construction. They are low risk, because the walls simply do not burn, so there is no hazard that anyone needs to concern themselves with in terms of the external walls. That does not mean that external fire spread will never occur, because you can still get window-to-window fire spread, but the walls will not make the problem worse.

If you have combustible material, the follow-on question is: how far does it go? How far up the wall could the fire spread if that combustible material was involved? Does it cross compartment lines, and is there therefore a likelihood of the fire going somewhere else? The final question then concerns the internal arrangements: if that spread should occur and covers a reasonable distance across the building, are there facilities for people to get out of the building?

We have taken a very scientific approach to it, and I am not sure it is conducive to legislation, to return to your question. There is probably a shorter, punchier way of doing it, but my fear, and the driver behind the way the PAS is written, is about giving people options and not assuming that everyone has the resources to do absolutely everything to mitigate risk.

Sarah Gibson Portrait Sarah Gibson
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Q I am one of the people concerned about the word “tolerable”. Your suggestion is that the definition is clear enough. Our earlier witnesses have said that they have seen building owners come up with assessments that differ vastly from other assessors, yet your feeling is that the definition of what they should be aiming at is sufficient and we do not need to go any further with it.

You mentioned that, for fire engineers, control and signing up to ethical standards and so on is in the process of being done. One would therefore expect that fire assessors, who are, of course, more likely to be involved in the remediation we are talking about, would also be included in that regulation. My question is: do you think that the level of control over those applying the assessment and the ethical codes that go with it are sufficient to limit the issues we have seen around discrepancies? Is it more a question of enforcement than legislation for what is causing the discrepancies?

Dr David Crowder: I think that enforcement would help. The answer to your question lies not necessarily within “tolerable” but in the freedom that users have been given to simply reach different conclusions and walk away. That is what we have tried to clamp down on with the redraft.

By way of example, I review FRAEWs on occasion, and I am quite obviously well versed in what PAS 9980 says. We have risk tables in the PAS that give different risk ratings to different features of buildings, and I have seen instances where appraisers will quietly slip in that a feature of a building has a different risk rating from what the PAS says it should have, and that then flows through and changes their outcome. The new PAS—the 2026 edition—says that, for any deviation, including that, you have to declare in your report that you have done something different. With multiple appraisals, people now have to explain why they have reached a different conclusion.

I have seen instances in the past where appraisers are restricted by their professional indemnity insurance and all they can do is condemn combustible cladding. They will not be given professional indemnity insurance unless they condemn everything combustible and give the okay only on stuff that is non-combustible. I argue that it is an ethical problem that they are allowing their work to be influenced by a pressure other than the science and engineering—that needs to be declared. If that is the reason their report says something different from the previous one, they need to say that that is the case.

Equally, it might just be because they do not have the risk appetite. If it is simply risk appetite, they need to say that, so that people can take them to task and we can start getting some clarity. We have done everything we can to try to narrow the field, and I would like to see more appraisers being held to account when they are providing answers that people do not understand.

The additional thing is peer review. We have also prescribed in the 2026 edition that when an appraiser is reviewing somebody else’s FRAEW, they should not simply start again at the beginning, run through the whole process and then reach their own answer, which is likely to be different because different engineers have different views. We now positively say that they are instead expected to go through the other engineer’s work—

None Portrait The Chair
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Order. That brings us to the end of the time allotted for this session. On behalf of the Committee I thank you for your evidence.

Examination of witness

Florence Eshalomi MP gave evidence.

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Gareth Bacon Portrait Gareth Bacon
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Q That is a reasonable point, but you have heard the concerns around the lack of specificity. Dame Judith talked about one standard applied uniformly, as opposed to introducing a level of ambiguity into the Bill. She feels that it would be much more beneficial for it to be specific. Is it the position of the Government that you do not agree with that?

Florence Eshalomi: What we need to distinguish is the fact that PAS 9980 as it stands does not remove or replace the need for buildings to comply with building regulations; maybe we need to make that a lot clearer. This is around highlighting that any remediation work that needs to be carried out must also meet building regulations that may apply to that. Again, there is the technical aspect of the Bill, and what we are seeking to do with this legislation is make clearer who owns that risk. PAS 9980 and building regulations serve two entirely different purposes. We are very clear on what building regulations are doing in terms of the regulations for new buildings, whereas PAS 9980 considers the risk and tolerable risk of buildings as they stand now, looking at the critical issue around safety when it comes to life and to external walls.

On the question of whether we should revisit the whole issue of “tolerable”, that goes back to my response to your initial question. Across the sector and industry, we feel that PAS 9980, set by the British Standards Institution, strikes the right balance in trying to find a way forward through something that has been at an impasse for many years—successive Governments have tried to resolve this.

It is about how we get the best approach in terms of moving forward in a really complicated but important area that is affecting so many people up and down the country. They want a resolution and to know that if something goes wrong in their building, which a number of them have invested a lot of money in—sometimes their life savings—they know who they can go to to remediate that. A lot of them bought in good faith and they should not have to turn themselves into building experts just to know that the building they are living in is safe.

Sarah Gibson Portrait Sarah Gibson
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Q I share the extreme concern of the hon. Member for Orpington. Dame Judith made it clear that other countries have been better at clarity than we have been. I know that the Minister cares about this issue enormously and wants to get it right, so I am slightly confused. It is absolutely clear, nine years later, that there is a complete lack of clarity in the UK on which agency has the final control.

We have not had accountable assessors, so we can have an assessment that decides that a building is tolerable but actually that tolerable level, as decided by an assessor, turns out not to meet the standard of building regulations, even at the time of construction. Why are we surprised that people cannot then sell their houses, get mortgages, or get insurance? We should not be. We must recognise that if we are going to put in a new piece of legislation, which will add to the amount of legislation that a leaseholder must look at, it has to be watertight—forgive the expression. The point has been raised today and it still concerns me: there is a lack of clarity about where—with which agency—the buck actually stops. A leaseholder needs to know where to go at the end. Who is really, finally responsible and accountable?

We also must make sure that the assessors who make the decisions can be held accountable, and that they have an ethical code in place to make sure that they cannot be manipulated by their employer. We should make sure that we make those points really clear during scrutiny of the Bill. That will make a difference to our leaseholders, who have waited so long for this legislation. I want to make sure that the Committee irons out those points over the next few weeks.

Florence Eshalomi: I totally hear that and accept it. To be honest, no one Bill can fix this mess. We are trying to make sure that leaseholders who have invested in good faith are not burdened with all the costs, hence the Bill introduces the charge for construction product manufacturers, which is important. To date, construction product manufacturers have not played their part in fixing the mess they created.

We are trying to strike the right balance. We have heard from the National Housing Federation and the LGA. If colleagues from the LGA, and other councillors, were here they would highlight the difficulties that they have in bringing forward new development. I see that acutely in my constituency, where—as the Committee knows—the Government introduced measures to change housing targets, which is having an impact.

A more prescriptive, blanket approach could lead to more extensive remediation, but will it make residents safe? Will it achieve the ultimate goal? How can we have the least disruption to residents? Some residents may have to leave their homes, and some will have additional costs—we must make sure those costs are recouped—and ultimately slower remediation. How do we make sure that we give more power and support to BSR to get the buildings that have been identified remediated?

We must be honest: although the issues in New Zealand are not similar to those here, there are areas where we can definitely learn. I will task officials to look a bit closer at that, and see if there is anything in the Bill that we can tweak during its passage. It is about being open, honest and receptive to those challenges, about making sure that we are being challenged and ultimately about trying to get something right as we progress the Bill.

Andrew Cooper Portrait Andrew Cooper
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Q This afternoon there has been some discussion about the risk of remediation costs being passed on to residents through service charges. Clauses 105 and 106 are intended to protect leaseholders from costs being transferred through the service charge. Today, Minister Pennycook announced measures to provide greater transparency on what service charges cover. Weighed against the evidence we heard today, does the Bill go far enough in providing that protection, or is further change is needed?