The Building Safety Bill 2020 was published on 20 July 2020, at a time when landlord and tenant professionals were distracted by the publication of the Law Commission’s three blockbuster reports on Leasehold Reform. It was therefore easy to miss the (rather more immediate) proposals in Part 4 of the draft Bill to bring in a whole new category of statutory charges for leaseholders, akin to service charges.
The proposals apply to fire safety charges for leaseholders in blocks of flats with more than 5 storeys – but they may be extended to other categories of properties in future years. Unlike the Law Commission reports, the Bill will be law within a few short months.
The Bill as a whole is part of a raft of legislation which helps meet the government’s commitment to implement the most urgent recommendations from the first phase of the Grenfell Tower Public Inquiry and those of Dame Judith Hackitt’s review of building regulations. It principally applies to any “higher-risk building”, namely a multi-occupied residential premises over 18 meters in height.
The substantive changes in the Bill to proposed fire safety standards and procedures are outside the scope of this article, but suffice it to say that the costs of the fire safety work to blocks of flats which and administration of the new regime are very significant indeed. The official estimate accompanying the Bill is that the cost of implementation will be between £4.381 and £8.161 billion pounds over a 15-year period.
Part 4 of the Bill attempts to replicate existing controls over residential service charges and to apply these controls to the new Building Safety Charges. The new statutory controls will initially apply to a relatively small number of properties. But they will govern many of the most sensitive (and probably controversial) property management projects over the next few years.