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Draft Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023

Debated on Monday 26 June 2023

The Committee consisted of the following Members:

Chair: James Gray

† Abrahams, Debbie (Oldham East and Saddleworth) (Lab)

† Aldous, Peter (Waveney) (Con)

† Benn, Hilary (Leeds Central) (Lab)

Berry, Sir Jake (Rossendale and Darwen) (Con)

Bradshaw, Mr Ben (Exeter) (Lab)

Burgon, Richard (Leeds East) (Lab)

† Fletcher, Colleen (Coventry North East) (Lab)

† Graham, Richard (Gloucester) (Con)

† Hayes, Sir John (South Holland and The Deepings) (Con)

† Holmes, Paul (Eastleigh) (Con)

† Hunt, Jane (Loughborough) (Con)

† Lewis, Sir Brandon (Great Yarmouth) (Con)

Osamor, Kate (Edmonton) (Lab/Co-op)

† Pennycook, Matthew (Greenwich and Woolwich) (Lab)

† Rowley, Lee (Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities)

† Russell, Dean (Watford) (Con)

† Young, Jacob (Redcar) (Con)

Liam Laurence Smyth, Committee Clerk

† attended the Committee

First Delegated Legislation Committee

Monday 26 June 2023

[James Gray in the Chair]

Draft Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023

I beg to move,

That the Committee has considered the draft Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023.

It is a pleasure to serve under you chairmanship, Sir James.

I am certainly not Sir James—just Mr Gray, unless you know something I don’t.

I am sorry, Mr Gray. I have started off well, haven’t I?

The regulations establish a responsible actors scheme for developers under sections 126 to 129 of the Building Safety Act 2022, focused on the remediation by developers of historical fire safety defects in residential buildings that they have developed in England. Developers that are eligible for the scheme but choose not to join, and developers that do join the scheme but then renege on their membership commitments, will be prohibited from carrying out major development or obtaining building control approvals for development that has taken place.

Following the Grenfell Tower tragedy it became evident that thousands of residential buildings over 11 metres had serious fire safety defects. That puts resident safety at risk while leaving many leaseholders facing significant remediation costs. The responsible actors scheme is one part of the Government’s wider response to the issues that came to light following Grenfell. In addition, we are protecting residents by spending £5 billion of taxpayer subsidy on remediating unsafe cladding on 18 metre-plus buildings, securing industry contributions to remediation by introducing a building safety levy and implementing statutory leaseholder protections against unfair costs of remediation, and we have created new legal avenues of redress for affected parties.

The responsible actors scheme focuses on major private sector developers that sit at the top of the supply chain and have overall responsibility for their developments. The Government engaged with major developers through a remediation pledge and then a legally binding developer remediation contract, which was announced earlier this year. I welcome the action that has been taken by the 49 developers that have now signed that contract. Those include the top 10 private sector UK house builders.

The regulations set out three descriptions of persons who are eligible to join the scheme. Developers based anywhere may be eligible for the scheme if they have developed relevant buildings in England. First, major house builders are eligible where their principal business has been residential property development, they were responsible for the development or refurbishment of one or more 11 metre-plus residential buildings in England in the 30 years ending 4 April 2022, and they meet the profits condition set out in the regulations.

Secondly, developers are eligible where they meet the profits condition and where they were responsible for the development or refurbishment of at least two buildings that we know are defective because the buildings have been assessed as eligible for a relevant Government remediation fund.

Can the Minister tell us what percentage of the total number of buildings that need remediation will be covered by the 49 businesses that have already signed up to the scheme? I presume the Government have a rough idea.

I am grateful to the right hon. Gentleman for his question. It is a difficult question to answer, but I will try to articulate a response as best I can.

We have assessed that in excess of 1,000 buildings will be remediated through the developer contract. That is in excess of £2 billion of remediation that is required, and that will be apportioned to the developers that originally caused the issues. The challenge with identifying an absolute denominator in order to get to the percentage is that until we get further into the third scheme that we are launching, for the 11 to 18 metre cohort—a pilot was launched at the end of last year and hopefully will be expanded in the months ahead—it is difficult to quantify exactly how many thousand buildings may have remediation issues. Until we have that number and add it to all the buildings that we know about that are over 18 metres, it is difficult to have an absolute denominator from which a percentage can be derived.

I am grateful for the Minister’s answer and I understand the explanation. Draft regulation 21(2)(a) talks about “fire safety defects”. The explanatory memorandum, however, refers to “life-critical fire safety defects”. Are those one and the same thing? However they are defined, do they extend beyond dangerous cladding to missing firebreaks and flammable insulation?

The regulations seek to mirror the provisions in the developer contract that each individual developer has signed, and that is based on the PAS 9980 assessment, which concerns the proportionate impact and what remediation is necessary to ensure that the risks are tolerable, primarily on external systems. Internal systems, such as firebreaks, unless they are attached to the external parts—there is often a difficulty in separating the two out—will be undertaken through appropriate assessments and protocols that are separate from PAS 9980.

I have discussed two of the eligibility provisions; thirdly, there is a voluntary eligibility provision. That allows other persons to join where they were responsible for the development or refurbishment of a building that would require remediation under the developer remediation contract.

The profits condition is focused on typical operating profits, averaged across the three years from 2017 to 2019, which were not impacted by the covid pandemic. Both the profits condition and the other aspects of the eligibility provisions make appropriate provision for the complex company group structures that some developers use. The regulations are also clear that registered providers of social housing are not eligible for the scheme. They will not be invited or permitted to join.

The Minister may not know that I tabled an amendment to the Building Safety Bill in relation to payment practice. In her investigation of Grenfell, Dame Judith Hackitt found a relationship between poor payment practice and poor building safety. Will the regulations take into account the importance of payment practice and its relationship to good building safety?

We are addressing the regulations for the responsible actors scheme, which my broader points have primarily reflected. If it would help the hon. Lady, I am happy to talk about payment practice separately.

The core conditions of membership of the scheme are that developers commit to identifying and remediating life-critical fire safety defects in residential buildings over 11 metres in height that they developed or refurbished in England in the 30 years ending on 4 April 2022 and to reimburse taxpayers for Government-funded remediation of such buildings if it has already occurred. To demonstrate its commitment, an eligible developer must enter into a self-remediation contract—that is, a contract containing the terms of the developer contract, which was published in March this year. The membership conditions require that members give effect to their remediation and reimbursement commitments in accordance with its terms.

I turn to the application provisions. The Committee may be aware that the Joint Committee on Statutory Instruments has drawn attention to two technical aspects of the drafting of the regulations, including one relating to the scheme application provisions. I want to address those aspects before we consider the provisions. I am grateful to the Joint Committee for its time and scrutiny and for its report, which the Government have carefully considered. We have corresponded with the Joint Committee and provided a memorandum that sets out our position, which is printed as an appendix to the Joint Committee’s report. I wish to take the opportunity to reaffirm our overall position on the issues raised, as explained in the memorandum.

First, on the application provisions, we consider it to be clear in context that, where the Secretary of State identifies that a person is likely to be eligible for the scheme, they will be invited to join the scheme, but that registered providers of social housing will not be invited to join because they are not eligible under regulation 6, as per my previous comments. In the light of the Joint Committee’s report, we will monitor implementation carefully and will consider bringing forward amending regulations in the event that the regulations give rise to misunderstanding in practice. The Government will also issue guidance on aspects of the scheme. The issue of developer remediation of unsafe buildings is urgent, however, and I will be seeking the approval of the House for these regulations.

The regulations set out the time periods to join the scheme and give developers an opportunity to make representations if they believe they are not eligible for the scheme. They also set out how developers can join the scheme in other circumstances. Membership of the scheme may be revoked for breach of membership conditions, or ended without fault where a member has substantially satisfied their obligations. Members will have the opportunity to make representations to the Secretary of State before their membership is revoked.

Should an eligible developer decide not to join the scheme by the end of the application period, or should their membership be revoked for failing to comply with the scheme’s conditions, they will, in accordance with the regulations, be prohibited from carrying out major development or obtaining building control approvals. At that point, the developer and known persons controlled by the developer will be notified and then added to a published prohibitions list, which will be used by local authorities for enforcement. Only a person named on the prohibitions list will be subject to the prohibitions.

The regulations also apply the prohibitions to persons controlled by the developer, to make sure that developers cannot easily avoid prohibitions by continuing their development business through other entities that they control. Such persons will be subject to a planning prohibition that prevents them from carrying out major development in England, except where planning permission was received before the regulations came into effect. Development of land carried out by a prohibited developer in breach of a prohibition will constitute a breach of planning control.

The regulations include provision that developers must notify local planning authorities about their status as a prohibited person or when prohibitions are lifted. The JCSI has reported on the absence of a specific sanction for failure to give notice under these provisions. I want to reassure the Committee that the regulations are effective without such a sanction. The primary mechanism for identifying prohibited persons will be the prohibitions list published by the Secretary of State, so local planning authorities will have access to all the information they need, even if a developer fails to notify them. In addition, any developer who engages in development contrary to a prohibition will be subject to sanctions through planning enforcement.

The regulations also establish a building control prohibition, which will prevent prohibited persons from gaining initial and final building control approval in respect of any building work that requires such approval.

The prohibitions will have limited exceptions, the purpose of which is to mitigate the potential impact on third parties, such as off-plan buyers, the wider public and certain entities that are not in the building industry. The building control prohibition is subject to exceptions that seek to protect third-party purchasers of property from a prohibited developer, including a specific exception to assist those whose deposits could be at risk if a prohibition came into effect after they had exchanged contracts. There are also exceptions to ensure that emergency repairs and other repairs to any occupied building that are necessary for the safety of residents can proceed.

Both prohibitions are subject to exceptions to exclude critical national infrastructure projects and to permit certain entities in developers’ corporate groups that are not in the building industry to have prohibitions disapplied to them where that would not frustrate the purpose of the scheme.

I know that the Committee will also be concerned about other industry actors, particularly construction products manufacturers. It is unacceptable that cladding and insulation manufacturers have not yet acknowledged their responsibility for the legacy of unsafe buildings. Most recently the Secretary of State has written to three industry participants—Kingspan, Arconic and Saint-Gobain—and their institutional shareholders to make it clear that those manufacturers must contribute to the cost of remediation or they may face consequences. The Government will consider all options to ensure that construction products manufacturers contribute their share.

The regulations will launch an important scheme for developers to remediate unsafe buildings. Given the urgency of the issue, we are introducing these regulations at speed for a scheme focused on larger developers. We propose to extend the scheme over time to cover all developers that have built defective buildings over 11 metres and should be paying to fix them. I commend the regulations to the Committee.

It is a pleasure to serve with you in the Chair, Mr Gray —it is only a matter of time until you are elevated beyond your present status.

I thank the Minister for the detailed explanation that he provided. The Opposition welcome this important instrument. Labour has always maintained not only that all blameless leaseholders should be protected from the costs of fixing historical cladding and non-cladding defects, irrespective of circumstance, but that those industry actors who have profited over recent decades from the construction or refurbishment of unsafe buildings —developers or others, such as product manufacturers—must contribute to the vast remediation programme that is now required to ensure that all defective buildings across the country are made safe.

While we very much share the Government’s objective that developers pay an appropriate share of remediation costs, we have always been at pains to highlight that the developer remediation contract is not a panacea for the building safety crisis. According to the Department’s own estimates, cited by the Secretary of State in the House on 20 February this year, the contract will apply to approximately 1,500 unsafe buildings. Given that the Department also estimates that there are more than 3,500 unsafe high-rise buildings and anywhere between 6,220 and 8,890 unsafe mid-rise buildings, it is abundantly clear that the contract will deal with only a fraction of the total remediation challenge.

On previous occasions in the House, the Minister has taken issue with that assertion, but unless he wants to quibble about the definition of what constitutes a fraction, or has revised estimates that suggest that the number of buildings within scope of the contract is significantly higher, any reasonable person would conclude that the figures that I have just quoted more than bear that out. All of that is to say that even if the contract should lead to the full remediation of every building to which it applies, other solutions will still be required for the many thousands of buildings across the country that lie outside its scope.

While it may not be a panacea for the building safety crisis, the developer remediation contract is nevertheless essential, and we welcomed it, albeit with caveats, when it was published. The responsible actors scheme, which today’s instrument establishes, is a necessary corollary to that contract, both as a means to compel developers to make the necessary remediation commitments and honour them, and to provide, as the explanatory memorandum rightly makes clear, for a level playing field so that developers that make the required commitments do not find themselves at a disadvantage relative to their industry competitors.

The Opposition have no objection whatsoever to the principle of establishing a responsible actors scheme, and we firmly believe that developers that either should join the scheme but do not, or do join the scheme but then fail to comply with its conditions and thus have their membership revoked, should face the resulting planning and building control prohibitions provided for by the instrument. The issues that I will raise are therefore not concerned with the principle of the RAS, but instead relate to the design of the scheme and its operation.

I intend to spend a little time setting out our concerns and questions. I hope that hon. Members will forgive me for doing so, but we feel that it is important that the Committee considers the instrument carefully, rather than subjecting it to only the lightest of scrutiny on the basis that the principle at issue is uncontested. We take that view not only because the instrument is both extensive and fiendishly complex, but because, as hon. Members who were actively engaged in the scrutiny of the Building Safety Bill, as I was, will recall, this place never debated sections 126 to 129, from which the instrument flows, as they were incorporated in the other place without dissent. It is therefore crucial that the Committee scrutinises the instrument exhaustively, to satisfy ourselves that the scheme that is being established will function effectively.

We have two broad concerns about the instrument, the first of which relates to eligibility for the responsible actors scheme that it establishes. There is still considerable confusion about eligibility, despite the Minister’s earlier explanation. The Opposition argue that it is crucial that not only is the membership of the scheme publicly available, but its potential size and composition is well known and well understood. Put simply, both the industry and those households living in unsafe buildings that require remediation should be able to easily ascertain not only which developers are members of the scheme at any given point, but which may well be obliged or persuaded to join it in the future.

We know that all residential property developers that have signed the developer remediation contract, or who the Department has made it clear are expected to do so, will be eligible for the scheme, yet the Government have been less than entirely transparent about precisely which developers fall within each category. We have attempted to secure answers through oral and written questions, but the Department will not tell us which house builders and mixed-use developers were initially asked to sign the developer remediation contract on 30 January.

The explanatory memorandum accompanying the statutory instrument states that by the summer of 2022, 49 developers had made a public pledge to fix life-critical fire safety defects in buildings over 11 metres in height that they had developed or refurbished. It also states that 50 developers were asked to sign the developer remediation contract and that 46 have done so. But as of this morning, the Department’s website states that 49 developers have signed the contract—that is the figure the Minister gave—and that four signed it but were subsequently found not to have developed buildings that are within its scope, and three have not signed. There is a slight discrepancy that the Government need to explain, not least so that leaseholders living in unsafe buildings have clarity as to whether their original developer has signed the contract or has not signed it but is expected to do so by the Department.

The explanatory memorandum also makes it clear that, as the Minister said, the Government expect the responsible actors scheme to expand over time to cover other developers that developed or refurbished defective buildings over 11 metres in height— presumably, beyond those that have already signed the contract or are publicly named as being expected to do so. Again, it is not immediately apparent who those future eligible developers might be, given that one would have expected the Department to have already written to all developers that developed or refurbished defective buildings over 11 metres in height and that meet the relevant profits threshold, asking them to sign the contract. I would therefore be grateful if the Minister could provide the Committee with some clarity as to why some developers that may ultimately be required to adopt a self-remediation approach and join the scheme have not already been asked to sign the developer remediation contract. For example, is it the Government’s intention to bring defective buildings under 11 metres in height into the scope of the contract and the scheme in the future?

Leaving aside the question of why some developers that may be brought within the scope of the RAS in the future have not already been asked to sign the contract, an examination of the provisions in the regulations makes it clear that there are several ways—the Minister alluded to them—in which the Government believe that developers may ultimately come within the remit of the scheme in the future. However, each begs questions, which I hope the Minister can answer.

Regulation 8 makes it clear that large developers that developed or refurbished defective buildings that have been assessed as eligible for a relevant Government cladding remediation scheme may be brought within the remit of the RAS in the future. Is it therefore the Government’s intention that all developers that are responsible for the development or refurbishment of a defective building or buildings over 11 metres in height—I think I heard the Minister perhaps mention two buildings as the threshold—and which have seen those buildings deemed eligible for funding from the private or social sector aluminium composite material cladding remediation fund or the building safety fund will ultimately be expected to join the RAS? If not, which ones will be expected to join, and which are the criteria on which they will be distinguished from those not expected to ultimately join?

A related issue is that there is currently no publicly available list of all those buildings that have been deemed eligible for public money from one of the aforementioned Government cladding remediation schemes. Is it the Government’s intention to publish in the near future a list to that effect, or is it the intention that new members that join the RAS because an unsafe building for which they are responsible has qualified for a Government cladding remediation scheme will not be publicly identified on that basis?

Regulation 9 provides another means for developers to join the scheme—namely, on a voluntary basis. However, it is not at all clear to Opposition Members what on earth the incentive to do so might be. Can the Minister explain why the Government believe that any developer would voluntarily join the RAS, so that we can understand the Government’s logic in respect of that route of entry?

The issue of voluntary membership also touches on the judgment of the Joint Committee on Statutory Instruments, in its 39th report of this Session, that regulation 30 is defectively drafted. The Joint Committee flagged that concern with the House on the basis that the regulation as drafted provides no mechanism for enforcing compliance with the notification requirements imposed on persons who are not members of the scheme but are eligible to join it. Again, we are looking for an explanation as to why any developer, either for reasons of benefit to it or as a result of the enforcement powers made available to various public bodies, would want to voluntarily join the RAS.

Finally, any developer deemed eligible for the RAS, either at the point of its inception or in the future, is expected to meet a profit condition. Regulations 7, 10 and 11 make it clear that the condition is, in essence, an average of £10 million in annual profit in the years 2017, 2018 and 2019. Will the Minister explain why the Department ultimately decided on that £10 million annual profit threshold, and whether it has carried out any analysis of how many developers that developed or refurbished defective buildings of over 11 metres in height have annual profits in the years in question below the designated threshold?

Let me turn to our second broad issue of concern, which relates to conditions of the scheme. Regulations 21 through 23 make it clear that these conditions are, in essence, the meeting in full of the obligations set out in the developer remediation contract. As such, the scheme that the instrument establishes will suffer from the deficiencies of the contract published by the Department on 16 March 2023. Chief among those deficiencies is the fact that the definition of “relevant defect” in the contract is different from the definition used in the Building Safety Act 2022 to define life-critical fire safety defects.

In a response dated 20 February 2023 to a written question I had tabled, the Minister made it clear that the definitions used in the contract and the Act were different because they were “drafted for different purposes”, with the purpose of the definition used in the contract being to address life-critical fire safety defects that arise from the original design, construction or refurbishment of a given building. Yet we have never had an explanation from the Government as to why the different definitions will not inevitably lead to a two-tier remediation system in which buildings covered by the contract remediate defects in accordance with it, while those outside its scope are forced to remediate to the broader and more stringent definition under the Act—namely, any defect that leads to the spread of fire or the risk of collapse.

We have also had no corresponding assurance from Ministers that leaseholders in buildings covered by the contract will not be exposed to enforcement action under the Act subsequent to the remediation of life-critical fire defects as defined in the contract. The Minister needs to provide an explanation and assurance in that regard this afternoon, because leaseholders across the country certainly fear that there is a risk posed by the different definitions that the Government have alighted on in the contract and the Act respectively, given that it is the Act that ultimately sets the legal standard for remediation of existing buildings.

The Minister also needs to explain why the definition of “relevant building” as set out in regulation 3 is different from the definition used in the Act. The Act makes it clear that relevant buildings are any that are over 11 metres in height or that contain five storeys. Regulation 3 defines relevant buildings only as those over 11 metres in height. One would presume that very few buildings will slip through the net as a result of the discrepancy, but there is presumably a chance that some might, otherwise why did the Act make satisfaction of either the five-storey or the 11-metre threshold, rather than both, a gateway to qualifying as a relevant building? If there is a chance that even a handful of buildings will slip between the net, the discrepancy needs to be addressed, because in a scenario where a building did fall between the two definitions, leaseholders of that building would not have the protection of the contract and could be forced to pay for the costs of remediation works themselves.

Lastly, I would be grateful if the Minister would provide the Committee with assurances regarding the provisions of the developer remediation contract and the scheme that relate to target dates by which participant developers are required to identify and assess buildings and thereafter undertake any works to fix life-critical fire safety defects as defined by that contract. The final contract stipulated that these must be carried out

“as soon as reasonably practicable”.

How do the Government intend to ensure that they are, particularly given that there is little indication—at least from my postbag—that the signing of the developer remediation contract earlier this year has accelerated assessments and remediation works on those buildings to which it applies.

Although we very much welcome this instrument and the objective that underpins the establishment of the scheme it gives effect to, there are a range of important questions that the Government need to provide answers to if we—and, more importantly, all those currently trapped in unsafe buildings within the scope of the contract and the scheme—are to have confidence that it will operate effectively in practice and in a manner that is fully transparent. I have set out a number of those questions this afternoon and I very much look forward to hearing the Minister’s response.

It is a pleasure to serve with you in the Chair, Mr Gray. I congratulate my hon. Friend the Member for Greenwich and Woolwich on his detailed exposition. The scheme, as my hon. Friend made clear, is a good thing, and I support it, because the Government have finally realised that they have some muscle they could apply to developers, rather than just sitting back and saying, “They won’t do anything, and there’s not much that we can do in response.” I therefore welcome the change, because it shows the Government’s willingness to draw on the levers that the state can exercise and to say, “If you don’t do this, certain very unpleasant consequences are going to follow.”

I have three brief points. First, I know of one case where the building had gone quite a long way down the route of getting money from the building safety fund—the plans were ready and so on—and then the developer involved finally signed on the dotted line, but the leaseholders’ concern was whether the developer would say, “I had better come in and have look” and poke and prod, and that that will extend the time before remediation, for which the leaseholders have been waiting desperately for a long time. It would be helpful to get an assurance from the Minister that that will not be the consequence of developers finally living up to their responsibilities. Anything that Ministers can do to ensure that developers crack on would be greatly appreciated.

Secondly, on the numbers, I listened carefully to what the Minister said in reply to my intervention, but I note that the Levelling Up, Housing and Communities Committee called in a report last year for the publication of

“all available data on the number of buildings of all heights with historic building safety defects—cladding and non-cladding”.

The Government said something very interesting in their reply to the Select Committee, on which I want to probe the Minister. They said:

“We are committed to publishing information in data releases as soon as it is appropriate to do so.”

“Appropriate” is a very odd word to use. In what circumstances would it be inappropriate to publish the data, except in cases in which the Government do not know the answer to the question? If the Government do not know, then all these years on after Grenfell they ought to ensure that they do know the answer, so that it can be published. That relates not just to ACM cladding, where the focus was in the first instance because Grenfell was covered in ACM, but to all other buildings.

I take it from what the Minister said that life-critical fire safety detects are the same as “fire safety defects”, as expressed in the regulations, and he referred me to the PAS 9980 process.

Finally, I think the Minister recently received a dossier from the End Our Cladding Scandal campaign relating to sub-11 metre blocks. He said in the House when the 2022 Act was being debated that the Government will look at such things on a case-by-case basis, and he expressed the Government’s wish to take things in stages. In the end, however, people in some blocks have not been able to sell because no EWS1 form is available, with some lenders are saying, “No EWS1, no mortgage, no sale.” The Government have tried to argue that there is no systemic problem with sub-11 metre blocks, but some mortgage lenders appear to be taking a different view. If that is the case in relation to sub-11 metre buildings, what is the position on buildings above 11 metres where mortgage lenders may be saying the same thing?

The Minister talked about the position depending on whether—I think he said this—the cladding is directly connected to missing firebreaks. However, if a mortgage lender says, “Without an EWS1, because there are missing firebreaks and flammable insulation in the building, we are not going to lend, and you are not going to be able to sell,” it seems that one of the principal reasons for the Government acting in this way, which I welcome, means that they will not solve the problem facing leaseholders. In the end, their test of whether the building is safe is, “Does anybody else want to buy my flat?” If people will not buy their flat because there is no EWS1 form, because someone else thinks there is still a risk, the distinction between cladding problems and other problems really does not wash.

I am grateful for the comments by right hon. and hon. Members; in the constructive spirit in which they were made, let me work through the individual points raised.

The hon. Member for Greenwich and Woolwich made the point about expansiveness. I understand his point about the developer contract, but we have taken substantial steps forward in recent months, as he kindly acknowledged in his speech. We are talking about more than 1,000 properties and more than £2 billion of remediation. That is a substantial contribution to something on which we all accept significant progress needs to be made, as it is being. We have been clear that we will seek to extend that over time, and we will make further announcements in the coming months.

On eligibility, as the hon. Gentleman knows we have published on a list of all the developers that have agreed to sign the developer contract. That list is updated regularly—an additional company was added in the past few days—and we have also published on ancillary points about the companies that were invited to join and either have subsequently chosen not to or it has been agreed that they will not join. I can confirm that we will publish a list of the companies that have been invited to join the RAS and of those that join the scheme. We are also clear that the scheme will be extended over time.

The hon. Gentleman’s point about voluntary eligibility was strong and important. The relevant provision is to try to make sure that we cover all the bases. I accept that this is probably a niche element of the discussion, but from my conversations with officials prior to this Committee I know that an example of where that could be the case is when two developers with profits underneath the current thresholds decide, for either commercial reasons or other reasons, to merge and thereby come within the scope of the scheme and choose voluntarily, in advance of being invited by the Government, to make it clear that they would seek to join to remove any consideration as part of whatever commercial scheme they are involved in. I am not saying that that is particularly likely to happen, and it is not necessarily the only example, but that is the kind of specific, niche circumstance that we are trying to address.

The hon. Gentleman talked about conditions and definitions, and I hope that I made some clear points about that in my speech. In essence, assessments can be made for externals in two ways: there is the historic consolidated advice note, which is still used by a substantial number of buildings, and then there is the PAS 9880 route through the fire risk assessment documentation. Ultimately, one of those options needs to be utilised so that people can assess whether the building has a remediation issue, and out of that flows a set of actions that are denoted in the fire risk appraisal of external wall, or elsewhere.

The Minister’s point raises an interesting question: if the PAS 9880 methodology has replaced the consolidated advice note, as it has, is it not incumbent on the Government to revise the Building Safety Act so that that methodology runs through the Act and the two definitions of “defect” are aligned?

We are not proposing to change primary legislation at this stage. We believe that the situation works and aligns in a way that allows both the previous processes for the CAN to work and for the PAS 9980 process also to be effective. We can see that that is happening on properties up and down the land, and each month more properties are starting remediation and, just as importantly, concluding remediation.

On the target date, I absolutely accept the hon. Gentleman’s point about the importance of clarity. I hope he will accept, in the spirit in which it is intended, my saying that it is very difficult to set absolute dates for when work on individual buildings must be concluded, because that is a function of many different variables, including commerciality, the signing of contracts, individual actors being able to turn things around quickly and so on. The reality is that the Government want that to happen as soon as is practical, hence the wording that has been put in place, and we will monitor progress extensively. I am doing that regularly. Over the past few months I have joined meetings of Homes England and of the Greater London Authority, and I have also been out on visits.

Our approach will be taken both through the official processes and through ministerial intervention when we need to speed things up. The developers should be under no illusion that the objective of the developer contract—which they have signed in this spirit—is to remediate the properties as soon as possible. We expect them to adhere to that, and we will be holding them to account through the returns we have included in the developer contract.

I hope that my comments on target dates have answered the first point made by the right hon. Member for Leeds Central. On the Select Committee point, as the author of—or one of the people involved in—that letter, I apologise if the wording was not as clear as it could have been in certain places. I would not read anything specific into the choice of words. Put simply, we accept from a practicality perspective that the denominator is going to move around. Occasionally, some buildings of over 18 metres come into scope, but they are a small proportion of the overall total, and we expect the cohort of buildings of between 11 and 18 metres in height to be variable in terms of the likely total.

I absolutely accept that point, but would it not be possible for the Government to have a current running total with the health warning that he has just given? In other words, “This is what we know as of this moment. The number may go up or down but, in the interests of full transparency, this is what we are aware of.”

The right hon. Gentleman makes a sensible point, and we are working towards doing that at the earliest possibly opportunity. I had meetings only last week on ensuring that that is the case. I absolutely accept that we need the greatest clarity and the greatest macro situation. Of course, it is important that everybody involved—I know that everybody present will do this—takes the numbers in the spirit intended and recognises that they are changeable. I absolutely agree that the central principle is that we should try to provide that information at the earliest possibly opportunity, and I will seek to do that from a ministerial perspective.

The right hon. Gentleman also spoke about sub-11 metre blocks. As he indicated, our approach, as articulated from the Dispatch Box by my right hon. Friend the Member for Pudsey (Stuart Andrew), has been to look at individual cases. We have been doing that, and I have been involved a number of times. As I make clear in correspondence with Members of Parliament, colleagues and others, we continue to ask for specifics. That includes concerns about potential issues with sub-11 metre buildings and whether someone has written them down in a document. For example, an expert assessor may indicate a problem in a FRAEW. We are going through those processes at the moment, and a very small number have articulated in writing a potential problem.

We are working with the assessors to get a more detailed understanding of the buildings affected, and we will continue to do that with any new examples. However, for the avoidance of doubt I stress that the number is very small. There is absolutely no confirmation at this stage that a cohort of buildings with an issue or a problem has been identified. In fact, the reality is quite the reverse. We have not yet identified a clear issue in sub-11 metre buildings, even in the very small number on which we have received reports, which we are still working through.

On the right hon. Gentleman’s final point, he is absolutely right that the ultimate objective and yardstick is whether an individual is able to buy and sell a property under the usual commercial terms. I hope that, through the announcement on 20 December and the operationalisation of a lender announcement from 9 January, the top 6 banks will lend on properties again and that they do not require an EWS1 form—it is a series of “or” statements in the lender contracts—so that the problems around EWS1 forms have either gone or is going. I am receiving periodic data from the banks about the volumes in the industry, and I think we are seeing some progress.

Where issues with how lenders are working have been identified, I am taking them up with lenders. As recently as last week I spoke to one lender about its requests for EWS1 forms, which is not what the lending agreement said. We will continue to do that where necessary, but the indication the I am getting, both from the officials who are looking at this issue and from the banks themselves, is that a lot of progress has been made. If individual leaseholders in buildings are finding it difficult to meet the cost of EWS1 forms, I would be happy to get further information so that I can take it up with the financial services industry and the individual banks involved.

The Minister has been extremely generous in giving way. We have thrown him a lot of questions, and he has characteristically tried to answer as many as he can on his feet. One thing is not clear, and I hope he might provide a little more clarity, particularly to leaseholders who are watching, as I know many are. In what way will the scheme be extended over time? Beyond the 49 developers that have signed the contract, what type of developer do the Government expect to come into the scheme at some point in future, if it is not through, as he put it, the very niche entry route of voluntary admission?

I am grateful for the question. I appreciate the importance of answering it, both for those who have an interest in it and for those watching who are affected by the issue. I hope we will be able to come forward with further information shortly. I am happy to write to the hon. Gentleman separately to articulate further information, if that is helpful, but I know that he will appreciate the fact that it takes time. We are trying to move as quickly as possible, which is one of the reasons why we chose an initial cohort and are seeking to move on.

I thank all Committee members for their contributions. The draft regulations establish a responsible actors scheme to ensure the safety of people in residential buildings, and to protect leaseholders and taxpayers from costs.

Will the Minister clarify something, for the avoidance of doubt? It is about when buildings are lower than 11 metres but there appear to be issues with valuations by estate agents who are unsure about the safety of the cladding arrangements. Has he made any consideration of what could alleviate the problem so that the market can operate properly and those who wish to sell can do so at sensible prices, and, likewise, those who wish to buy can get mortgages to do so?

I hope the lending agreement that was articulated by the big six lenders in January goes some way towards answering that question. We are working with relevant conveyancing organisations to provide clarity, but the fundamental and substantive answer is that the big six banks have given commitments to lend on the affected properties, which means that the ability to buy, sell and remortgage should be possible. There will obviously be commercial decisions behind those decisions, but it should be possible, and the early indication is that volumes are starting to move again.

The draft regulations establish a responsible actors scheme to secure the safety of people in buildings, to protect leaseholders and taxpayers from costs, and to ensure that a developer eligible for the scheme will take responsibility for the issues that have been created by its construction. There is, of course, more to do, as we have discussed on a number of occasions today. The Government intend to expand the scheme, but I hope the Committee will welcome this important step forward.

Question put and agreed to.


That the Committee has considered the draft Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023.

Committee rose.