Wine as an investment – the wine merchant’s risk
In construction, “underpinning” is the process of strengthening the foundation of an existing structure in order to provide stability in cases where the original foundation is not strong enough. In respect of building safety, the Hackitt Report seeks to change the ethos of the industry by strengthening the existing foundations and introducing new ideas to build upon them.
I introduced this series by travelling back to the 1970’s and looking at the founding legislation relating to workplace health and safety and it has developed. I then turned to the Report and reviewed its key recommendations and their potential impact on the construction industry, including proposed changes to the Construction (Design and Management) Regulations (‘CDM Regulations’) and the introduction of a ‘golden thread’ of information.
In my final blog in this series, I will review how the procurement process could be affected by the Report’s recommendations before commenting on the latest developments six months on from its publication, including the ban on the use of combustible cladding which comes into force today and the government’s formal response to the Report which was published earlier this week.
The Report briefly deals with health and safety issues in respect of tender, procurement and supply. As part of the desire to change the culture of the construction industry, it recommends that the industry look to good practice in other sectors, where the protection of health and safety performance is “an integral part of contract negotiation and agreement”.
The Report is particularly critical of the customary contractual arrangements whereby (according to the Report) too many of the key accountabilities are being delegated by the client, Principal Designer and Principal Contractor. It cites “the low margin for larger contractors leading to them pushing technical and contractual risk down to their subcontractors” for encouraging poor behaviours in the respective relationships. The difficulty with such contractual delegation is that many of the smaller contractors do not have the resources to deal with detailed health and safety matters comprehensively and appropriately.
The Report also refers to contractual payment terms as a driving force for poor performance; particularly subcontractors who do not receive timely payment and who may then substitute certain materials for cheaper materials which may not be suitable for their purpose.
It recommends that safety requirements should be effectively tested during the procurement stage. Clients and Principal Contractors should include specific clauses in their contracts which state that safety requirements must not be compromised for cost reduction and such provisions should be included in the digital record.
These recommendations will likely have the most notable impact on those providing legal advice to their clients during the procurement process.
In the six months since the Report’s publication there has been a noticeable divide in the industry between those in favour of the recommendations, those who are critical of the recommendations, such as the National House Building Council (NHBC) who have voiced concerns that local authorities will not have the expertise nor the financial resources required to form part of the proposed Joint Conduct Authority (JCA), and those who feel the Report does not go far enough by falling short of calling for an outright ban on combustible cladding.
Off the back of the Report we have already seen RIBA (the Royal Institute of British Architects) announce that it is in the process of developing a new mandatory health and safety test which all of its UK chartered members must complete.
The biggest development has come in the latter stages of the year following the government consultation which formally closed in August. This led to an announcement in October that the government would seek to ban the use of combustible cladding on all new residential buildings above 18 metres. The prohibition will come into force today, 21 December 2018, in the form of the Building (Amendments) Regulations 2018 (the “2018 Regulations”).
The 2018 Regulations will apply to any building over 18 metres in height which contains one or more dwellings. It is interesting to see that the 2018 Regulations take a broader approach than the Report with regards to the height of the applicable buildings. As an illustration, the average height of a storey of a residential high-rise building is approximately 3 metres. At 68 metres high, Grenfell Tower consists of 24 storeys. The Report’s recommendations apply to higher risk residential buildings (HRRBs) with 10 or more storeys (approximately 30 metres in height and above), whereas the 2018 Regulations apply to residential buildings over 18 metres in height (approximately 6 storeys and above). It is likely that the 2018 Regulations include buildings of lower height in order to encompass residential buildings which are often less than 10 storeys in height but may house vulnerable people, such as hospitals, care homes and sheltered housing thus addressing one of the early criticisms of the Report (i.e. its application to tall buildings only).
The 2018 Regulations also apply to refurbishment works carried out on existing buildings where an external wall is involved or where there is a material change of use which results in it becoming a residential building.
Whilst the ban on combustible cladding comes into force on 21 December, there will be a transitional period. The 2018 Regulations will not apply to construction work where a building notice, an initial notice or full plans have been submitted to the local authority prior to 21 December and the work to which it relates has either started prior to 21 December or will start within two months of that date. The government has provided a list of indicative identifiers which may evidence whether or not work has commenced. For example factors which may show work has commenced include piling and excavation for strip or trench foundations, but the removal of vegetation or general site servicing works would not suffice.
All materials which form or become part of an external wall or a specified attachment, such as any part of the external wall, balconies, sun deflectors, and solar panels, must be able to adequately resist the spread of fire over the walls and from one building to another. The materials used must be adequate and proper and appropriate for the circumstances in which they are used.
The nature of each material used is measured objectively with reference to specific European fire safety standards. Unless excluded by Regulation 7(3) all materials used must achieve European Classification A2-s1, d0 or Class A1 (classified in accordance with BS EN 13501-1:2007+A1:2009). In practice this means that the materials used must not contribute to fire growth nor to the fully developed fire (Class A1), or at a minimum must not significantly contribute to the fire growth and fire load in a fully developed fire (Class A2) and have only weak or no smoke (A2-s1) and no dripping (d0).
It is unclear whether further amendments to the Building Regulations will follow in order to incorporate existing buildings where combustible materials have been used and refurbishment work is not expected to take place in the near future.
The government’s formal response to the Report was published earlier this week with the government deciding to implement all 53 of the Report’s recommendations. Before implementing them at scale, the government will trial features of the new system to make sure they are effective. This will be done by introducing a new Joint Regulators Group (JRG) to develop and pilot new methods of regulation. Thereafter the JRG will assist with the transition to the new regulatory framework. The JRG will combine the knowledge of the Health and Safety Executive, Local Authority Building Control, the National Fire Chiefs’ Council and the Local Government Association.
Significant steps have already been taken with the implementation of the ban on combustible cladding and the government’s declaration that desktop studies (i.e. assessments in lieu of tests) for external walls on buildings which fall within the remit of the ban will now be prohibited.
The government has not provided a timetable for the introduction of the reforms. It took years to fully implement the provisions provided by the CDM Regulations and it has taken over two decades to develop them into a form which is easily understood by those who are obliged to comply with them. It is likely that the Report’s recommendations will also take a substantial period to shape into a workable form and there may be snags in the Report which are not apparent at this stage. However, those in the industry will recognise that it can take time for defects to be rectified.
The Report has provided a solid foundation for reform but if the ultimate aim is to change the culture of the construction industry for good then you cannot simply paper over the cracks.
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