Responsible Actors Scheme launched

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The Responsible Actors Scheme (RAS) was launched on 21 July 2023.

Eligible developers that fail to join or comply with the conditions of the RAS will be subject to building control and planning prohibitions. The Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023 contain the detail of the RAS and are unchanged from the draft Regulations.

Eligible developers that join the RAS will be required to comply with membership conditions including:

  • Identifying those residential buildings at least 11m in height in England for which they are responsible for developing or refurbishing in the last 30 years, which require remediation of life-critical fire safety defects.
  • Undertaking at their own cost, or procure at their own cost, the works necessary to remediate or fully mitigate any fire safety defects.
  • Reimburse any funding received from the government remediation programmes in relation to remediation works on their own buildings.
  • Enter into the developer remediation contract and comply with the terms (Regulation 21).
  • Provide the Secretary of State with information in accordance with the developer remediation contract and such other information as the Secretary of State reasonably requires “in order to monitor and enforce their compliance” with the developer remediation contract and the regulations (Regulation 22).

Eligibility

The RAS is initially aimed at major housebuilders and other large developers that have developed or refurbished multiple residential buildings that are known to have life-critical fire safety defects.

However, it is the government’s intention to expand the RAS in the future to include other developers that have developed or refurbished defective residential buildings that are at least 11 metres in height where the government believes these developers should pay to fix them. 

The government has published an enrolment guide that encourages “any developer that developed unsafe residential buildings of 11 metres or over in height in England over the 30 years to 4 April 2022 to come forward as soon as possible and commit to remediate life-critical fire safety defects”.

Developers will be eligible under one of the following grounds, subject to meeting a profits threshold:

  • Principal business residential property development: Developers that have developed or refurbished one or more residential buildings at least 11m high in England between 5 April 1992 and 4 April 2022 and whose principal business is residential property development (Regulation 7).
  • Buildings eligible for remediation funds: Developers that have developed or refurbished two or more buildings, which have been assessed - before 4 July 2023 - as eligible for a relevant government cladding remediation scheme (Regulation 8).

The profit threshold referred to above will be met if the developer has an annual operating profit over a three year period - financial years ending in 2017, 2018 and 2019 - of £10m or higher (Regulation 11).

When considering eligibility, a developer will be treated as responsible for the development or refurbishment of a building, if that building was a building for which a company in the same group was responsible for developing or refurbishing between 5 April 1992 and 4 April 2022, even if this was before the companies were in the same group. This may extend eligibility to group companies where a company within the group would be otherwise eligible, but does not meet the profit condition. 

Note that under regulation 6, registered providers of social housing or a wholly owned subsidiary of a registered provider of social housing will not be eligible to join the RAS.

Joining the RAS

The guide outlines three pathways to joining the RAS:

  1. Invitation to join: Under regulation 13, the Secretary of State will write to eligible companies and invite them to join the RAS. 
  2. Request an invitation to join: If a company meets the eligibility criteria but has not received an invitation, it can contact the DLUHC directly to request an invitation to join. If the DLUHC considers that the company is eligible, it will then receive an invite to join the RAS.
  3. Volunteer to join: A company that is not eligible to join can volunteer if it has developed or refurbished one or more residential building at least 11m high in England between 5 April 1992 and 4 April 2022:
  • that would require remediation under the developer remediation contract; and
  • the company is willing to join the RAS and sign the developer remediation contract. 

Upon request, if the Secretary of State considers the company eligible to join, an invite to join will be issued. 

Members and prohibitions list

A list of members of the RAS will be published and maintained. 

There will also be a RAS prohibitions list, which will list eligible developers that have failed to join and those who have joined, but have had their membership revoked due to failure to comply with the terms of the RAS. 

Those on the list will be prohibited from carrying out major development and from securing building control approval - subject to exceptions. In addition, any entities that they control will also be added to the prohibitions list. Therefore, developers will be unable to avoid the prohibitions by developing through other entities within their control. 

Prohibitions

The government has published a RAS: plain English Guide that states the purpose of these prohibitions is to “act as an incentive for developers to remediate and/or mitigate defects in unsafe buildings and will make sure that responsible developers who take on the cost of remediating unsafe buildings are not disadvantaged as compared to other eligible developers who fail to do so”. 

Prohibited persons will be prohibited from carrying out major development in England. This includes:

  • Schemes providing 10 or more residential units.
  • Residential schemes on a site at least 0.5 hectares in size - where it is not known if it will provide 10 units or more.
  • Commercial development creating at least 1,000 square metres of floorspace.
  • Development on a site over 1 hectare in size. 
  • Carrying out major development of land in England through any agent or contractor or any other person acting for or on their behalf.

The planning prohibition will apply to planning permission granted after the date on which the Regulations came into force (4 July 2023). It will not apply to planning permission received before 4 July unless a subsequent application is required for all or part of the development, and that application has not been determined before that date.

A prohibited person will be prevented from gaining building control approval in respect of any building work that requires such approval. 

These prohibitions are subject to certain exceptions including that the Secretary of State may disapply the prohibition in respect of a specific site if the development or proposed development relates to critical national infrastructure and it is in the public interest to disapply the prohibition (Regulation 31). 

Developers should now consider whether they are eligible to join and respond to any invites within the requisite timescales. Companies that should also be aware that it is the government’s intention to expand the scheme over time. 

Disclaimer

This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given. © Shoosmiths LLP 2024.

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