Making buildings fit for the future

Current situations and issues within the construction and development world have created a sector burdened with uncertainty. The UK is experiencing a housing and development crisis, and at the heart of this lies two factors: current building stock deemed high risk and a planning process that is ineffective, outdated and highly discretionary.

The legislative hand has been somewhat forced with regard to the first issue. The Grenfell Tower tragedy catapulted the urgent need for safety improvements into the spotlight, highlighting buildings unfit for habitation at a safety level. Significant flaws in building standards and the regulatory scheme were then exposed by the Independent Review of Building Regulations and Fire Safety, led by Dame Judith Hackitt.

The Building Safety Act

The review’s recommendations have led to the introduction of the Building Safety Act, passed in 2022 and being introduced to a pre-agreed timescale. Backed by the establishment of a Building Safety Regulator (BSR) within the Health and Safety Executive, an Act described as “groundbreaking and transformational” is ushering in a new era for the planning, design, management and operation or occupation of higher risk buildings. Its intention is to strengthen controls in place within the building sector and to make property owners more accountable for their buildings and safety both within and around them.

By 30 September 2023, it was necessary for all higher-risk buildings in England and Wales to have been entered into an official register. In the eyes of this law, a higher-risk building is one over 18 metres or 7 storeys in height, with at least two residential units. No building of this type that remains unregistered can now be legally occupied.

Those responsible for such buildings have to appoint an Accountable Person or Principal Accountable Person, who must handle safety reporting and management and be the official duty holder responsible for creating a ‘golden thread’ of information. Their role is to capture all information relating to a building’s design, build and management, and ensure this is upheld throughout its lifetime, as well as being stored digitally for accessibility. Other duties are also expected of them, including creating a Residents’ Engagement Strategy.

Within the golden thread, they also need to prepare a Safety Case Report, intended to contain all information relating to fire hazards and their management, as well as provide an ongoing focus on structural safety.

Completion certificates and claims limitation

Part of BSR’s role is to review and consider planning and construction applications, thereby tightening building regulations and fire and general safety standards. It will also enforce building compliance and take action against offenders. BSR will inspect each completed building and only issue a Completion Certificate, to allow for its occupation, if satisfied that all standards have been met. The process through which BSR and a contractor or property owner can together arrive at this stage will be through three gateways. Satisfying BSR requirements at each one is necessary before any work can continue to pass the project through the next gateway.

This is not all the Building Safety Act has done. It has also extended the period of time in which a claim that a building is unfit for habitation under the Defective Premises Act 1972 (DPA), or in breach of the Building Act 1984’s Building Regulation, can be made. Whereas previously, the limitation period was only six years, it is now 30 years for any project completed before 28 June 2022 or 15 years for those completed after this date.

Meanwhile, a new DPA Section 2A extends the potential of liability to refurbishment or extension projects carried out by a business where the claim falls after 28 June 2022. An affected party will have 15 years to make a claim.

Next steps for developers

It is important that developers, builders and contractors study this legislation in detail, noting new liabilities and aspects of protection for leaseholders. Ensuring high-risk buildings meeting the Act’s definition have been registered, and an Accountable Person or Principal Accountable Person appointed and aware of what is expected of them is the first step to take.

Whether or not this Act goes far enough in embedding fire and structural safety at the heart of building stock is being debated. Some insurers argue the height of a building is not the sole determinant of its level of risk and that more needs to be done to embed safety within the planning system. Any circumvention of building regulations because of a relaxation in Permitted Development Rights has to be carefully managed to ensure safe buildings and safety for the occupants of those buildings.

Insurability of buildings

With insurance and risk so entwined, a case is also being put forward for insurance considerations to be built into the planning process as a legal requirement. In this way, buildings and homes would not face a potential situation in which they are uninsurable at some point in the future or become “costly white elephants”, as they have been described.

Making buildings insurable is as important in terms of flood risk as for fire risk in the eyes of leading players within the insurance sector, who have, since 2021, been advocating more joined-up thinking at the heart of planning.

Their fear is that a drive to deliver on housing targets — specifically the 300,000 new homes promised annually by the current Government — will lead to building development that does not consider flood risks, climate change and the need to future-proof buildings through materials and methods used within construction.

The need for planning reform

With the planning system not having had the shake-up promised by Boris Johnson, these experts also fear that steps forward, such as the Environment Act 20219, could potentially become less effective in its intention if overridden by conflicting planning decisions.

A cross-section of insurance industry experts have put forward five suggestions with regard to sustainability and the future insurability of buildings. As well as making it a legal responsibility to ensure that buildings will be insurable, they want to see the 18 metre/7-storey criteria within the Building Safety Act removed, so the Act applies to buildings of any height.

Secondly, they have put a focus on Modern Methods of Construction (MMC) — techniques that are alternatives to traditional housebuilding, whether in terms of construction processes or materials. The experts wish to see the establishment of a transparent database that hosts information and details best practices within MMC, as well as providing an early-warning vehicle through which emerging safety concerns can be highlighted. All MMC properties would be included, along with details of all materials used within them.

Flood risk and SUDs

The third recommendation relates to flood-risk areas. The insurance experts do not wish to see development taking place in such high-risk areas, wanting to see flood resilience becoming a mandatory part of planning decisions and building regulations for both residential and commercial developments. They point to the potential for mass future catastrophe as climate change greatly increases the amount of rainfall impacting the UK, where 5.2m homes and businesses already face a flood risk.

Furthermore, they want swift action to increase the use of Sustainable Drainage Systems (SUDs) within developments and recognise the need for such SUDs to be included with projects submitted for planning consent. The call is for schedule 3 of the Flood and Water Management Act to be passed to increase standards within drainage and establish an approving body for such systems.

SMEs and skills gaps

The fourth recommendation is intended to help smaller developers compete in the construction marketplace to help deliver on new home targets. Adding diversity in the sector should drive up standards, but SMEs currently struggle to navigate the planning labyrinth. The insurance experts want to see the introduction of a specific fund, as well as named contacts within planning departments, and together this could assist the renaissance of SME involvement in the housing sector.

Finally, safety and sustainability are seen as only being achievable if the sector has the skills to deliver both. With skills gaps in general, and a low-carbon skills gap in particular, plus chronic shortages of professionals such as architects and planners, a new skills strategy is required. The experts believe that addressing the skills shortage requires action not just within apprenticeship strategies but also within schools and higher education establishments.

STEM subjects need to become more attractive in pupils’ eyes as pathways to careers. Only then will the sector have the capacity required to deliver sustainable and safe homes and commercial buildings.

Summing up

The message is that it is not sufficient to deliver just any home or building without considering the wider implications for safety and future environmental impact. Yet, without the overdue and greatly needed overhaul of the UK planning system, the current fire safety criteria of the Building Safety Act and the pressure to deliver ‘volume’ to meet set housing and low-carbon requirements are worrying to many. Too many properties currently face becoming uninsurable and, therefore, redundant for occupation or use.

Having current planning regimes shoot holes in ambitious housing and environmental targets makes no sense, yet it is the most likely outcome unless reform is swiftly introduced and the voices of leading experts are heard. Planning reform, safety considerations and sustainability need to become the new
construction trinity.

For more information about how to make buildings fit for the future, get in touch with L Wood Insurance Brokers today.