Sign up or miss out: 5 things to look out for in the Responsible Actors Scheme
The Building Safety Act 2022 (the BSA) was primarily introduced to tackle building safety concerns and transform the way that tall residential buildings are designed, built, and managed. True to its word, sections 126 – 129 of the BSA permit the implementation of secondary legislation in this sphere in the form of the 'Responsible Actors Scheme' (the Scheme), which the government currently anticipates will be enacted in England by early Summer 2023.
It will require its members to identify and remediate 'life-critical fire safety defects' in 11m+ residential buildings that have been developed or refurbished by them in the 30 years preceding enactment.
Members' commitment to the Scheme will be illustrated through signing the 'developer remediation contract' produced in partnership with the Department for Levelling Up, Housing and Communities (the DLUHC Contract). At the time of writing, 46 developers have signed the DLUHC Contract.
Who can join the Scheme?
Eligible developers of the Scheme fit into one or more of the following categories:
- The developer's principal business is the development of residential property, produces average annual operating profit over a 3-year period of £10 million or higher ("the profits condition"), and has included the development or refurbishment of 11m+ residential buildings in England in the last 30 years (other than solely as a contractor);
- The developer meets the 'profits condition' referred to in point I above, and has developed or refurbished (other than solely as contractor) multiple buildings that have been assessed as eligible for a relevant government cladding remediation scheme;
- The developer developed or refurbished (other than solely as a contractor) at least one 11m+ residential building that qualifies for remediation under the DLUHC Contract and volunteered to sign the DLUHC Contract and join the Scheme.
5 things to look out for:
1. Failure to comply with membership conditions may lead to the revocation of membership to the Scheme.
2. Membership conditions are expected to require members to:
- sign and meet all obligations of the DLUHC Contract;
- identify 11m+ residential buildings developed or refurbished by them over the past 30 years and those that have life-critical fire safety defects;
- remediate and/or mitigate life-critical safety defects in applicable buildings and reimburse applicable government schemes for taxpayer-funded work to remediate such defects; and
- evidence compliance with any information requests from the Secretary of State.
3. Eligible developers who fail to join the Scheme risk adverse commercial consequences, which are being broadly categorised as "planning prohibitions" and "building control prohibitions" and may prohibit a person from:
- carrying out 'major development' in England.
'Major development' is expected to extend to schemes that provide 10 or more residential units, residential schemes on a site of 0.5 hectares or more in size, commercial development creating 1,000 or more square metres of floorspace, or development on a site over 1 hectare in size. Those prohibited will be required to notify local authorities when making planning applications, and local planning authorities when acquiring or transferring an interest in land with the benefit of planning permission for major development; and
- gaining building control approval in respect of work completed or not yet started. In some cases, this may result in a notice to terminate or suspend work.
Building control prohibitions may also prevent a person from supplying prescribed documents that could stop the progress of development plans or works altogether. Those documents include plans and plans certificates, initial notices, completion certificates, final certificates, certificates for buildings occupied before work is completed, and any other building control approval (including building notices, amendment notices, notice(s) of variation(s) of work, and regularisation certificates).
4. The Scheme is expected to specify exemptions which permit certain works to be undertaken where necessary to secure occupants' safety.
5. It is anticipated that provisions will also be made to allow one entity in a company group to join the Scheme on behalf of others in that group.
If enacted in its current form, this secondary legislation will (as intended) vastly change the landscape of the development sector. The government's plan to enact the Scheme by Summer 2023 leaves little time for much amendment to its proposed scope, but - as we saw with the BSA - it remains possible.
What is clear, though, is that:
- the Scheme must chime with the principles already laid down in the DLUHC Contract and the powers afforded under the BSA; and
- the publication of intended enforcement measures will increase already mounting pressures upon eligible developers who have not yet voluntarily signed the DLUHC Contract (but will have little choice but to do so if they intend to continue carrying out major development in England).