The High Court has ruled that retrospective changes to the LGPS exit credits regime were lawful – and gave some helpful guidance around the new discretion to pay an exit credit.
The Grenfell Tower tragedy has understandably prompted a fundamental reconsideration of how building safety is approached for High-Rise Residential Buildings (HRRBs), in terms of the regulatory framework that applies to construction and management of HRRBs, and also construction methods and material selection.
Whilst the Hackitt Report and Building Safer Future consultation indicate how the regulatory environment may change, housing providers are facing on-going uncertainty as to precisely what new regulatory obligations they will take on, and whether they will have additional legal rights to discharge those new obligations.
This uncertainty is exacerbated by the continuing investigations by Ministry of Housing, Communities and Local Government (MHCLG) into building materials and systems. The MCHLG’s investigations into the efficacy of Aluminium Composite Material (ACM) cladding systems and Glass Reinforced Plastic (GRP) composite fire doors were well publicised, but investigations into other materials and systems continue.
In June 2019, MHCLG published an advice note regarding the use of combustible materials in balconies, followed by a test report in July 2019 regarding the fire resistance of High-Pressure Laminate (HPL) cladding systems when installed in conjunction with combustible insulation. That test report advised social housing providers to replace HPL cladding systems, but to prioritise the removal of ACM cladding systems. It is likely that as MHCLG investigates other building materials and systems, they will identify further fire safety risks.
Remediating the fire safety issues already identified following the Grenfell fire carries a significant cost, which was (understandably) not anticipated by the sector. In September 2019, the G15 group estimated the total cost of fire safety remedial works to their combined housing stock could cost as much as £6.9bn. In light of the on-going investigations by MHCLG, social housing providers will understandably have concerns about what further fire safety risks they will identify, and how they respond to those issues as they become known. Not only is resident safety of paramount importance, but providers will be concerned that they will need to remedy fire safety defects to the satisfaction of the new building safety regulator (once the regulator is established).
Practical steps to staying agile
Given the ongoing uncertainty as to whether further fire safety issues will be identified, social housing providers must be agile to respond promptly to evolving fire safety issues, including being able to:
- Identify the extent to which further fire safety risks affect their properties, and which specific properties are affected;
- Determine how to address those risks under the fire risk assessments (FRAs); and
- Identify where claims against contractors or designers are possible for recovering the costs of remedial schemes.
There are practical steps that social housing providers can take to place themselves in the best position to respond to evolving fire safety issues, including:
- Construction contracts – ensure that all contracts for construction, maintenance, and repairs works are collated and stored where they can be easily accessed. This would include not just legal terms of contracts and professional appointments, but specifications, scopes of service and ancillary documents, such as parent company guarantees, performance bonds, collateral warranties and product guarantees. Should further fire safety issues be notified by MHCLG, being able to identify whether the affected products, materials, or working methods have been delivered under a particular contract will assist social housing providers in scoping out the extent to which their housing stock is affected, whether a contractor or designer is liable for the cost of a remedial scheme, and help to identify any contractual limitation issues.
- Management – having a single point of responsibility for responding to fire safety issues is an approach some of our social housing provider clients have adopted. This ensures that ownership is taken for resolving issues as they arise, gives a “joined-up” and consistent approach across issues of fire safety, and helps to promote depth of knowledge within the delivery team.
- Stock information – ensuring that key data regarding housing stock, and in particular HRRBs, is collated in a centralised and easily accessible format will also help providers to respond to further fire safety issues as they are identified. This may include cross-references to any repairs, maintenance or works contracts that apply to the HRRBs, any major building products or systems that are installed at those buildings (such as cladding systems, or the manufacturers of flat entrance doors and the door type), and any other critical information. Having clear and reliable data means that when an issue is identified (for instance, if another cladding system is found to be unsafe), the affected properties can be readily identified. We are aware of providers who undertook a comprehensive stock survey programme following the Grenfell fire, for the purpose of collating a rigorous database of fire safety information for their housing stock, which has facilitated a prompt response to fire safety issues as MHCLG continues to circulate the outcomes of their investigations.
- Review FRAs – social housing providers will likely have reviewed the FRAs for their HRRBs in the context of concerns regarding cladding materials (both ACM and HPL) and GRP composite fire doors. If MHCLG notifies the sector of further fire safety issues, it may be necessary to revise FRAs again. This can be a significant task, and so having a reliable set of up-to-date FRAs that are collated and easily accessible can ease the process.
Seeking legal support
As a construction team, we are advising a significant number of social housing providers about the investigation and remediation of fire safety issues, including unsafe cladding, defective GRP composite fire doors, defective sprinkler installation, and wider fire stopping issues, together with claims against contractors for the recovery of remedial costs. This advice is supported by colleagues with fire safety experience drawn across our housing management, housing and property litigation, and regulatory and governance.
For more information
The Government has brought forward draft laws to allow independent schools to close the Teacher’s Pension Scheme to new joiners but to allow existing members to continue.
The Government has started consultation on the regulations providing the detailed framework for collective money purchase pension schemes.
In June we took on the challenge to become a Sepsis Savvy organisation - I'm really pleased to announce we've done it!
In 2020 the court rules were changed to require that all residential tenants must be given 14 days’ notice of an eviction. What happens though if the eviction is cancelled on the day?
We are delighted to announce that our private wealth law department has continued to maintain its Band 2 position in the latest edition of Chambers and Partners High Net Worth.
The new CHF is set to launch and open for applications with £4 million set to be allocated to community-led housing groups to support an increase the supply of affordable housing in England.
Charities, like other organisations, may be subject to or choose to voluntarily comply with the reporting requirements under the Modern Slavery Act 2015.
The draft regulations making it mandatory for anyone entering a registered care home in England to have been double vaccinated unless they are clinically exempt were made on 22 July 2021.
Doug Mullen and Michelle Knight discuss the recent judicial review of regulations changing the regime governing exit credits in the local government pension scheme.
To receive invitations to our events, as well as information and articles on legal issues and sector developments that are of interest to you, please sign up to Newsroom.