My Lords, I open this group by introducing a number of technical amendments tabled to strengthen the Bill. Included within this group are amendments that simply update the drafting of the Bill. These include Amendments 72, 75, 79 and 274.
I will speak to government Amendments 17 to 19, which make changes to Clauses 41 and 47 and introduce a new clause relating to approved inspectors. Amendments 18 and 19 relate specifically to approved inspectors’ insurance, while Amendment 17 introduces a power for the regulatory authority to inspect local authorities and registered building control approvers. The Building Act 1984 currently requires approved inspectors to hold insurance through a government-approved scheme. These amendments remove this requirement. Instead, approved inspectors will need to identify adequate cover themselves, encouraging competition between insurance providers.
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The Bill will give the new building safety regulator powers to set insurance requirements for approved inspectors—or registered building control approvers—via professional conduct rules, should it choose to do so. In line with other professions, approved inspectors will be required to make judgments on how best to cover their liabilities. Your Lordships will already be aware that the Bill provides the building safety regulator with the powers to sanction any approved inspector or registered building control approver who fails to meet standards set out by the professional conduct rules, which may include requirements on insurance. The measures which I am introducing will help ensure that the approved inspector sector’s liabilities continue to be adequately covered.
The amendments made to the special measures provisions are minor and technical in nature. They replace references to “relevant person” with “accountable person”, consequential to the removal of the BSM role, and provide more detail on when a contract is a “relevant contract”.
Government Amendments 238 to 242 make changes to Clause 139 to clarify the definitions of “new-build home” and “developer”. They make sure that extensions
to residential buildings to create new homes would also fall under the new homes ombudsman’s remit; for example, where a new floor is added to an existing residential building to create new flats. They also make it clear that the ombudsman’s remit covers works which create new homes within an existing residential building, rather than only changes to buildings previously used for other purposes.
Finally, government Amendments 243, 244 and 265 address concerns raised in Committee on new-build warranties. I thank the noble Lords, Lord Best and Lord Kennedy—the latter is not in his place—for raising important concerns regarding inadequate new-build warranties and making the case for all new-build warranties to satisfy proper standards. We have also been in discussion for some time with warranty providers, developers and financial regulators on this issue and, in the absence of a proposal from the market, the Government have concluded that intervention is necessary.
I am therefore pleased to introduce amendments to mandate in law that a developer must provide a warranty to a purchaser of a new home. The minimum length of warranties on new-build homes is set at 15 years, in line with the prospective limitation period for action under the Defective Premises Act 1972, and we are taking a power to set out in regulations the minimum level of coverage provided by those warranties.
Amendment 243 also includes powers to set the period during which the developer itself remains responsible for fixing defects, aiming to keep those who caused the problem on the hook for longer. We will propose regulations setting out, for the first time, minimum levels of warranty coverage and standards of service to be provided, as well as setting out in law that the benefit of the policy would be transferable when a property is sold within the policy term.
Finally, this amendment will also provide for a further power to make regulations imposing a financial penalty of up to £10,000 or 10% of the sale value, whichever is greater, on any developer which fails to meet these new requirements without a reasonable excuse.
Together, these amendments will better support home owners, giving them greater protection and peace of mind when purchasing new-build homes and improving redress for when things go wrong. I beg to move.