Amendment 5

Fire Safety Bill - Report – in the House of Lords at 2:30 pm on 17th November 2020.

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Lord Kennedy of Southwark:

Moved by Lord Kennedy of Southwark

5: Clause 2, page 2, line 11, at end insert—“( ) The consultation under subsection (5) must involve—(a) local authorities;(b) relevant trade unions including but not limited to those representing firefighters;(c) relevant organisations representing firefighters;(d) bodies representing tenants and residents of impacted properties; and(e) any other bodies deemed relevant by the Secretary of State.( ) A report detailing the findings of the consultation under subsection (5) must be laid before Parliament.”Member’s explanatory statementThis amendment would ensure that any consultation must include local authorities, trade unions, and representatives of tenants and residents.

Photo of Lord Kennedy of Southwark Lord Kennedy of Southwark Opposition Whip (Lords), Shadow Spokesperson (Home Affairs), Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Housing)

My Lords, this is an issue that I raised in Committee, and I confirm that I have no intention of dividing the House on it this afternoon. I have tabled it again to give the Minister the opportunity to put beyond any doubt that the organisations that I have listed will be consulted, without question, because they are important in their different ways. I accept the point that has been made before that things change over time, but I think it is a reasonable assumption that we will have local authorities, trade unions representing firefighters and other workers in the sector more generally, and associations representing tenants and residents, for the foreseeable future, and that consultation must go much wider than the National Fire Chiefs Council.

Amendment 6 from the noble Baroness, Lady Neville-Rolfe, is a probing amendment, as the noble Baroness makes clear in her explanatory statement, allowing the Minister to offer clarity to the House. Again, I welcome the amendment made in that spirit by the noble Baroness and I beg to move.

Photo of Baroness Neville-Rolfe Baroness Neville-Rolfe Conservative

My Lords, it is always a pleasure to follow the noble Lord, Lord Kennedy. I think that he and I agree on the value of consultation in many different arenas.

My probing amendment relates to an appalling situation arising as an indirect consequence of the Grenfell tragedy. As a direct result of that fire, vast amounts of cladding, especially on high-rise blocks, will have to be removed. The requirements for improvement consequently imposed on those concerned—freeholders, leaseholders and so on—affect a very large number of multiple-occupation dwellings, unnecessarily, some might say, whatever their height. As a consequence, surveyors, insurers and mortgage lenders, all financially involved, have become very concerned by their clients’ potential unquantified exposure to risk and are taking steps to minimise it. Inevitably, they are taking a cautious view. Wooden features such as staircases and partitions—used since the dawn of time and much more sustainable than steel or plastic derivatives—are often viewed with suspicion.

A particular uncertainty is what the remedial action will cost and who will bear that cost. There is currently no good answer to that concern and, as a consequence, much of the market is effectively frozen. Thus, many properties are in practice unsaleable, with knock-on effects on people’s financial viability and the mobility of workers. As I emphasised in Committee, this is a nightmare for the young who want to move when they have a baby, for the old who want to trade down to something smaller and release capital for their care, and for the unemployed who need to move to get a new job.

I explained all that in Committee, and I think it would be fair to say that, although the Minister, in responding, accepted that there was a problem, he said nothing about how it might be solved. I hope that we can move a step forward today and that the Minister will be able to say something that will ease up the market in respect of at least some of the dwellings where the fire risk is small. Standing back, it is apparent that the Bill takes us in the wrong direction on this issue, because it provides for an increase in the number of requirements and regulations without providing a way forward on the threat to the housing market and our reputation as supporters of home ownership, which many people aspire to.

To be more specific, first, can the Minister provide a clear trajectory for the implementation of the Bill, the revisions to the fire safety order and the building safety Bill to reassure us on consistency and show how the uncertainty and unintended consequences for leaseholders arising as a result of these changes will be kept to a minimum?

Secondly, what assessment have the Government made of the availability of qualified assessors and fire safety engineers to account for the increased demand that will arise from the Bill? How can they help in this regard?

Thirdly, can the Government develop a system, such as you might see in the health and safety area, referenced earlier, that allows non-professionals involved in managing multiple-occupation properties to do the necessary risk assessments and give the assurances needed for the market to move? The EWS1 system—designed, I believe, to help with the mortgage problem—has, unfortunately, had a perverse effect.

Fourthly, can the Minister say anything to unfreeze properties—for example, those of a low height where the risk is much less?

This is a very difficult issue and I know that my noble friend the Minister, with his experience of local government, understands the issues and has been trying very hard. I welcome the considerable funds made available to deal with the most serious high-rise cladding issue and the progress that is therefore being made. He should also be thanked for his wider efforts to improve the housing sector and build more homes. However, the problem that I have described, with support from my noble friend Lord Shinkwin in Committee, is a very serious one and we need action now. As the noble Lord, Lord Kennedy, will be winding up on this group, I should like to say that I, like my noble friend Lord Bourne, would appreciate a further meeting on how we tackle this matter before the new order and the building safety Bill proceed.

Photo of Lord Shipley Lord Shipley Liberal Democrat 2:45 pm, 17th November 2020

My Lords, the noble Baroness, Lady Neville-Rolfe, has made a number of helpful and very important points. Amendment 6 seeks clarification from the Minister on a number of problems in relation to leaseholders and the impact on the housing market of the current problems with selling properties. I, too, look forward to the Minister’s response, as it would be helpful to us all to have an up-to-date understanding of his thinking.

We shall, of course, address this matter on Amendment 13 as well, as it is central to the future management of high-rise accommodation, or the less high-rise accommodation that nevertheless still suffers from some of the problems of the high-rise blocks. As the noble Baroness said, we need a way forward for the housing market in solving the problems of some leaseholders. I entirely agree with that, and I hope that forthcoming meetings will be able to address those issues.

Amendment 5, moved by the noble Lord, Lord Kennedy of Southwark, is entirely sensible. Of course it is right to consult properly and fully in developing legislation, so I assume that the Minister will be able to confirm this afternoon his entire agreement to this amendment because it is so eminently sensible.

Photo of The Earl of Lytton The Earl of Lytton Crossbench

My Lords, although I certainly agree with the thrust of Amendment 5, it is Amendment 6, in the name of the noble Baroness, Lady Neville-Rolfe, that I really wish to address.

Many of my years in the property profession have been spent in survey inspections, with a spell in estate agency and mortgage valuations and brief periods in block management, and I have spent a good deal of time on the forensic identification of defects. Therefore, I feel reasonably well qualified to support the noble Baroness, and I thank her for raising this important issue, which affects the residential sector. Rightly, she referred to the indirect effect of the Grenfell tragedy. That is a matter on which I have been in constant contact with the Chartered Association of Building Engineers, of which I am a patron and which has been very helpful in identifying various matters in respect of the Bill.

As the noble Baroness said, the effect on the residential market for flats in particular, and over a very broad spectrum by age and type, is now apparent. This has affected security for mortgage lending, exacerbated by the prospect of large and, as the noble Baroness said, unquantified remediation bills. Some sort of game of pass the parcel seems to be in train as to who will end up picking up those bills. It affects buildings insurance cover and premiums, and interim measures such as “waking watch” are racking up huge costs. These and the likely shortfall, as I see it, in the provision for remediation made by the Government—welcome though that is, but nevertheless there is a shortfall as against the widening scope of the buildings that might ultimately be affected—have seriously affected the ability to sell flats. It is not clear that this is in any way confined to high rise, as I am increasingly aware, as one of my children attempts to sell a flat in a four-storey modern and, I believe, conventionally constructed block.

A few days ago, a lady emailed me to say that she is a resident of a sister block to the one in Worcester Park which burned down last year. She is completely stuck with a currently worthless asset and no apparent movement on remediation. The latest Sunday Times carried an article about this, graphically illustrating the issues and defects that have been found to be present in a number of remaining identical buildings that are still standing.

Before this gets yet more problematic and starts affecting potentially a far wider range of properties than at present, the Government need to use their powers and influence to get all the interested parties round a table—constructers, lenders, insurers—and point out, as the noble Baroness said, the reputational as well as economic and social damage that needs to be contained beyond the issue of direct liability and who shoulders that, and require their active co-operation to resolve this in a constructive manner and not leave vulnerable homeowners, to put it bluntly, hung out to dry.

I appreciate the criticism of the EWS1 form, but it came about because of a particular need to do with mortgage lending. It is now being required for a much wider range of purposes, for which it was never intended. Why? Because it was the only tool available. The Government could step into this obvious void and make sure that some other form of certification solution was provided. But they, or somebody else, would have to take responsibility for that, and I realise that that is an issue. Meanwhile, the potential liabilities make it ever less likely that those without specific accreditation to do the necessary inspections will be willing to undertake such work and, indeed, they may not be able to get professional indemnity insurance either.

The Government need to get ahead of the curve here. If these measures are rushed into effect with full force immediately and without additional steps, there will be more serious disruption and collateral damage to come. I suggest there be a phased and managed approach aimed at containing the ill effects, restoring trust and confidence, above all, in the measures being put in place and limiting financial loss while dealing, most importantly, with the most pressing issues where residents’ safety is at the greatest peril. None of this is without risk; nor is the normal “Not my responsibility, guvnor” liability-passing response appropriate in these abnormal times, given the number of national issues we face and the effect on the wider economy.

This means temporary but probably arbitrary cut-offs, probably in height terms—11 metres may be the right figure for blocks of flats—perhaps with certain other definitions, then dealing with those and drawing the net more widely later on and inevitably, as one will, picking up legacy issues from older regulatory sign-offs on the way. Some sort of lower-tier interim certification, which the noble Baroness referred to, perhaps by a non-specialist, would enable low-risk properties to escape the contagion that might otherwise engulf the sector. I wonder if this is what the Minister will propose in Amendment 7. I will listen with great interest to his response.

Photo of Baroness Pinnock Baroness Pinnock Liberal Democrat Lords Spokesperson (Communities and Local Government)

My Lords, I remind the House of my interests, as recorded in the register, as a councillor in Kirklees and as a vice-president of the Local Government Association.

I turn first to Amendment 6, through which the noble Baroness, Lady Neville-Rolfe, has raised concerns about the inclusion of all multi-occupied domestic premises within the scope of the Bill. The issues raised relate to leaseholders who find that they are, in effect, unable to move as their property is within the scope of the Bill and, therefore, that the fire risk exists but is not quantified. The later amendment in my name explores these issues in more detail.

In Committee, the noble Lord, Lord Parkinson, spoke on behalf of the Minister and confirmed that the Government intend that all multi-occupational buildings are within the scope of the Bill and the fire safety order 2005. He also argued in Committee that the height of a building is only one factor in assessing fire risk, and others have given recent examples of fires in such buildings that support that argument. The issue, then, is about prioritisation, as the noble Earl, Lord Lytton, has so expertly explained, and what actions the Government are able to take to minimise the impact on properties deemed low priority and, therefore, presumably of lower risk. It is that issue that the Minister needs to clarify. Will the Government bring forward regulations or guidance to demonstrate the criteria to be used to fire assess properties? Can these be used by leaseholders to demonstrate low risk, and thus release their property from being frozen out of the housing market? I look forward to the Minister’s response to these concerns.

The other amendment in this group, in the name of the noble Lord, Lord Kennedy, raises issues about consultation. It lists consultees, as a very similar amendment did in Committee. My colleagues and I are always in favour of the widest possible consultation on any issue. However, there is an inherent risk in a list that becomes exclusive while intending to be inclusive. The list of consultees is one which we would expect, however, to be involved in all relevant consultations. As my noble friend Lord Shipley said, the list is inherently sensible, so I hope the Minister will be able to accept such a list. Again, I look forward to the Minister’s response.

Photo of Lord Greenhalgh Lord Greenhalgh Minister of State (Housing, Communities and Local Government), The Minister of State, Home Department

My Lords, I thank the noble Lord, Lord Kennedy of Southwark, for raising the issue of engagement to make sure the right groups and organisations are consulted on any changes or clarifications to the types of premises that fall within the scope of the fire safety order. The Government have given this matter further consideration since Committee stage. I support the noble Lord’s aim of ensuring that the widest range of groups are given an opportunity to comment. It is sensible to seek views from all groups impacted by any future changes, which is why Clause 2 of the Fire Safety Bill provides a requirement to consult anyone appropriate, which is likely to include all the parties highlighted in the amendment.

Robust policy-making can be achieved only by reaching out to all sections of the fire sector and other interested parties, such as responsible persons and residents, not by relying solely on the expertise of certain groups. To be clear, of course we will consult with the National Fire Chiefs Council but equally, we will consult with the Fire Brigades Union and with tenants’ and residents’ associations.

The Government are committed to considering the most appropriate means of conducting any future consultation before making any regulations—regulations which Parliament would have an opportunity to scrutinise, should it so wish. It remains the case that the specified list as presented identifies groups whose role, name or function may change over time, potentially creating the need for future primary legislative changes or making such provision ineffective. However, the Bill as drafted safeguards against this while ensuring that relevant groups are not excluded. I want to assure your Lordships’ House that we recognise the importance of consulting relevant stakeholders, but the wording of Clause 2 already allows us to do just that, without the need to be prescriptive in the way the noble Lord’s amendment suggests.

I turn now to the very important consumer issues raised by my noble friend Lady Neville-Rolfe. I had a meeting with my noble friends Lady Neville-Rolfe and Lord Shinkwin, and I am very happy to commit to a further meeting before the introduction of the building safety Bill. These are huge consumer issues, and I praise my noble friend for being a champion of the consumer. We recognise that many leaseholders’ properties have been valued at zero, they are waiting for remediation of their properties and they are unable to remortgage or to move. They are effectively trapped, and the Government recognise that that is a considerable issue for them. We also recognise that the costs of historic building safety and fire safety remediation will be considerably more than the £1.6 billion already committed. It is important to address that in a way that is affordable to leaseholders, and there are only certain ways of doing that. We will make announcements on that in due course.

Equally, we recognise that the pace of remediation is important. I have talked to many people in the social housing sector about the fact that they have probably overspent on waking watch. I am very pleased that we provided guidance on waking watch, the cost of which is exorbitantly high; it can be replaced by a fire alarm system within six or seven weeks, which reduces some of the costs of interim measures. I draw the attention of those using waking watch for extended periods to the most recent guidance from the National Fire Chiefs Council and the work on waking watch costs. I am very happy to commit to a further meeting.

Turning to the amendment, I thank the noble Lord for his continued input on the Fire Safety Bill and for his amendment seeking clarity on how the Government intend to use the power to change the types of premises to which the fire safety order applies. I remind noble Lords that the purpose of the Bill is to improve fire safety in all the buildings to which it applies to make sure that residents feel safe in their homes. I know this objective is shared by all in your Lordships’ House and the other place. The Government believe we have the right buildings within the scope of the order at present, but it is important that we create the right legislative framework to provide the flexibility to make future changes to the types of buildings which may pose a risk. The Bill may be on the statute book for a long time, and this clause allows us to keep it agile and relevant to emerging changes. If, for example, a new design of building emerges in future, we will want to make sure that it can be captured without the need for further primary legislation.

The clause is not intended to be a blunt instrument. We have introduced a robust set of safeguards to ensure that relevant parties can comment on any future changes. However, I understand the concerns about the current mortgage and insurance situation that my noble friend is looking to address, and which I have already discussed. We are working with lenders on a more proportionate approach to the assessment of fire safety risks for valuation purposes, which will benefit residents. The updated fire risk assessments following this Bill should provide the further reassurance that lenders are looking for in the EWS1. I hope this gives my noble friend confidence that our aim is to ensure flexibility, and not a form of mission creep to bring more premises under the order. Given the assurances I have provided, I ask the noble Lord, Lord Kennedy, to withdraw his amendment and my noble friend Lady Neville-Rolfe not to move hers.

Photo of Lord Kennedy of Southwark Lord Kennedy of Southwark Opposition Whip (Lords), Shadow Spokesperson (Home Affairs), Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Housing) 3:00 pm, 17th November 2020

My Lords, I thank the Minister for his response to this short debate and for putting clearly on the record his views on consultation, which I fully support. As he said, it is important to have a wide range of appropriate consultees.

I also fully support the points raised by the noble Baroness, Lady Neville-Rolfe. We cannot allow people to continue to live in properties that are, effectively, worth nothing. I hope that the meeting referred to will take place, but it is also important that when builders construct these buildings and give warranties and guarantees, they are upheld. It cannot be right to allow builders to walk away from their obligations under warranties and guarantees have given; they need to be held accountable. I hope that the Minister will take back that very important point. I beg leave to withdraw the amendment.

Amendment 5 withdrawn.

Amendment 6 not moved.

Photo of Lord Alderdice Lord Alderdice Deputy Chairman of Committees

We now come to the group beginning with Amendment 7. I remind noble Lords that Members other than the mover and the Minister may speak only once and that short questions of elucidation are discouraged. Anyone wishing to press this or anything else in this group to a Division should make that clear in the debate.