To ask the Secretary of State for Housing, Communities and Local Government, what impact assessment his Department has undertaken of the potential risks of associated with 20 per cent of banks, building societies and mortgage lenders not adopting the Royal Institution for Chartered Surveyors EWS1 guidance.
The Government is assured that most major lenders, about 80% of the mortgage market, have adopted the approach in the RICS EWS1 guidance or already take a significantly less risk averse approach. The Government has not said that 20% of lenders have not adopted the RICS EWS1 guidance: our efforts have been focussed on the lenders with the largest share of the market, so this does not necessarily mean that the remaining 20% of market share, made up of much smaller lenders, are not using the RICS guidance.
The Department frequently engages with the industry and will continue to challenge them on the use of the EWS1 process, as well as pressing for more data transparency on how the RICS guidance is being applied, and the effect of the process on mortgage applications. We already know, via data from one major lender, that an EWS1 already exists for 50% of mortgage applications where one is requested, and we are working with industry to ensure this picture only improves.
We will continue to work with lenders to enable them to understand and accept other forms of assurance such as a comprehensive fire risk assessment which includes the external walls or post 2018 building control sign off for high rise blocks.