Building Safety Bill: key points for the construction industry

The Building Safety Bill was finally introduced into Parliament on 30 June 2021 with the aim of delivering fundamental reform to the building safety system. The Bill’s progress through Parliament will be closely monitored as the construction industry looks to prepare for the potentially wide-ranging impact of this complex piece of legislation.

The Bill was published in draft form in 2020 to enable pre-legislative scrutiny. Lack of detail on key parts of the new regime was highlighted by the Housing, Communities and Local Government Committee in its report which contained a number of recommendations, following which some changes have been made prior to the Bill’s introduction into Parliament.

Increased liability

The Bill includes new provisions to more than double the limitation period for breach of the duties contained in the Defective Premises Act 1972 (DPA 1972). Section 1 of the DPA 1972 applies to the carrying out of work in connection with the provision of a dwelling and imposes a duty:

• to carry out the work in a workmanlike/professional manner
• to use proper materials
• when the work is complete, the dwelling must be fit for habitation

This extension to the limitation period will have retrospective effect, with the potential for claims previously thought to be out of time, now to be pursued. In addition, the cause of action under the DPA 1972 will be extended to include refurbishment work, applying prospectively and subject to the 15-year limitation period. Liability under s.38 of the Building Act 1984 for breaches of the Building Regulations will also be subject to the 15-year limitation period, applying prospectively, when this provision is in force.

Once these provisions come into force, this extension to the limitation period may open up a right of recovery for claimants seeking to bring claims against designers, contractors and developers concerning cladding, external wall systems and fire safety failings, that may currently be unavailable to them due to the expiry of the limitation period. Therefore, designers, contractors and developers may have a greater exposure to claims if the work they have carried out is subject to the extended limitation period.

‘Higher-risk’ buildings

The Bill provides for a stringent new regulatory regime that will apply during the design and construction of higher-risk buildings. The government’s intention is that this will apply to buildings that are at least 18 metres in height or have at least seven storeys and have at least two residential units. Care homes and hospitals meeting this height threshold will also be included in the new regime relating to design and construction (contained in Part 3 of the Bill) but are excluded from the new regime for higher-risk buildings in occupation (contained in Part 4 of the Bill). Draft Secondary legislation has been published alongside the Bill setting out technical definitions and identifying certain buildings that are currently excluded from the regime.

Further detail awaited

• Gateways: The Bill provides for a new ‘Gateway’ regime to ensure building safety risks are considered at each stage of the design and construction of higher-risk buildings. However, the secondary legislation containing the practical details of Gateway two (before construction begins) and Gateway three (the current completion/final certificate phase) has not yet been published. Gateway one (before planning permission is granted) will be implemented by amendments to the relevant planning legislation and is due to come into force in August 2021.

• Developer levy: A new Gateway two levy will apply to developers seeking permission to develop high-rise buildings. The levy will help fund the Government’s costs of remediating building safety defects. Further details regarding the levy will be contained in regulations including the rate of the levy, when this must be paid and the consequences of non-payment.

• Dutyholders: A new dutyholder regime is intended to improve accountability as buildings are designed, constructed and refurbished. The dutyholders include the Principal Designer and Principal Contractor appointed under the Construction (Design and Management) Regulations 2015. The Government is working with the British Standards Institution to create a suite of national competence standards which will include a competence framework for the key roles of Principal Designer and the Principal Contractor. It is expected that the British Standards Institution will consult on these roles in 2021.

What will happen next?

Further detail is still needed to understand and properly scrutinise how the regime will work in practice and some aspects of the Bill may be subject to change as it progresses through Parliament. A key point for debate will be the definition of higher-risk buildings with the potential for a larger number of buildings to fall within the scope of the new regime.

The Government has published an outline transition plan and will refine this plan during the passage of the Bill through Parliament. The Government expects the Bill to take at least 9 months to progress through Parliament and many aspects of the Bill will not take effect for 12-18 months after the Act comes into force. However, the Government’s response to pre-legislative scrutiny by the Select Committee urges “future dutyholders to start preparing for the new regime immediately”.