The Building Safety Act 2022 and Social Housing

The Building Safety Act 2022 includes a host of new regulations surrounding the planning and building of homes – so how does this affect Social Housing?

The Building Safety Act (“the Act”), which received Royal Assent in April, was Parliament’s response to the Grenfell Tower tragedy. The Act contains 171 provisions, affecting almost every aspect of building development and management, and will put in place a number of structural changes to how the development industry operates. One of these changes is to the certification of Building Regulations compliance.

Building Inspectors

In the beginning there were local authority building control officers. Then the Building Act 1984 introduced the concept of Approved Inspectors: private practice consultants, registered with the Construction Industry Council Approved Inspectors Register (CICAIR) who were required to carry insurance from a scheme approved by the Secretary of State. Free-market principles were thus brought into the process for approving and certifying that buildings had been designed and executed in accordance with Building Regulations. The Building (Approved Inspectors) Regulations 2000, and then 2010, set out the duties and liabilities of these Approved Inspectors.

There was some question about the possibility of taking legal action against Approved Inspectors. The leading case of Murphy v Brentwood District Council [1991] confirmed that it was not possible to make a claim in tort, but what about in contract? Approved Inspectors were appointed by the client by agreement, and the terms of that agreement could presumably be breached – so why not a claim for losses arising from those breaches. Although (in the absence of a direct collateral warranty from them) there is no contract between most claimants and the Approved Inspector, the case of Crest Nicholson Operations Ltd and another v Grafik Architects Ltd and another [2021] did confirm thata breach of contract claim is possible, in accordance with the usual common law principles of contract law.

Now, however, the Act has introduced an entire new system for inspecting and certifying the design and construction of buildings in accordance with Building Regulations. Individuals and organisations will need to register as “building control approvers”. A new Building Safety Regulator (BSR) will maintain a register of these building control approvers and set competence criteria for performance of their role. The BSR will have the power to set insurance requirements, but cover will need to be obtained from the wider insurance market, rather than a limited number of government-approved schemes, as s48 of the Act removes the requirement for an Approved Inspector to obtain insurance from a government-approved scheme. This provision came into force on 28 July 2022 in England and Wales via new regulations:

• In England and Wales, the Building (Approved Inspectors etc) (Amendment) (England) Regulations 2022 (SI 2022/718) amend the Building (Approved Inspectors etc.) Regulations 2010 (SI 2010/2215) by removing the requirement for an Approved Inspector to show that it maintains insurance from a government-approved scheme in certain situations.
• In Wales, the Welsh Government (WG) has made the Building Safety Act 2022 (Consequential Amendments) (Approved Inspectors) (Wales) Regulations 2022 (WSI 2022/767). These regulations make consequential changes to the underlying Building Regulations regime to cater for the removal of the insurance requirement. The WG subsequently issued a circular letter, Removal of criteria for Approved Inspector insurance (WGC 004/2022), which makes it clear that approved inspectors can obtain insurance in the open market that reflects the risk of the type of work they undertake. However, the amendments do not remove the need to comply with insurance requirements imposed through registration with the CICAIR.

As well as changes to insurance requirements, the Act sets out procedures both for the mandatory registration of building control approvers (which will also apply to local authority building control officers) and also for breaches of the new scheme.

A person’s entry onto this register can be for all purposes, or may be restricted to certain functions. They may be for a fixed time only, and can be subject to conditions. The register will be available for public inspection and there will be a code of conduct, which all registered building control approvers must adhere to. Sanctions will be imposed against those whose conduct is liable to bring the profession into disrepute. This is not toothless; the sanctions include cancellation of registration, suspension, the imposition of fines or conditions on working. And, inspectors can be suspended for three months pending investigation into alleged professional misconduct.

The Birketts view

The new system is due to come into force by October 2023. The administrative burden on both inspectors and local authorities is going to be significant, and may reduce the number of Approved Inspectors. Whether developing themselves, or buying from commercial developers, any such reduction will undoubtedly affect the delivery of social housing units. Registered Providers will need to be satisfied, either by their own appointments or pursuant to any build agreement, that the developers constructing on their behalf have appointed a building control approver, and that their registration to the BSR has not lapsed and/ or is not subject to any conditions which would affect their certification of the particular scheme.