Michael Gove – 2023 Statement on Building Safety – Responsible Actors Scheme and Developer Remediation Contract

The statement made by Michael Gove, the Secretary of State for Levelling Up, Housing and Communities on 24 March 2023.

On 14 March, I announced that 39 developers had signed the developer remediation contract. By signing the contract, they made binding commitments to fix or pay to fix life-critical fire safety defects in all buildings in England over 11 metres that they had a role in developing or refurbishing over the past 30 years. This amounts to an irreversible commitment to making safe at least 1,100 buildings at a cost of over £2 billion.

Update on responsible actors scheme

Last week, I also told the House that there will be consequences for companies that do not sign the contract. I warned that they will be prohibited from commencing developments in England or gaining building control sign-off on their developments, unless they sign and adhere to the contract. I said that we would lay regulations this spring to establish a responsible actors scheme. The regulations will recognise the positive action of responsible developers and will make sure that eligible developers who do not sign and comply with the contract will be unable to be members of the scheme, and therefore be subject to prohibitions. I will lay regulations that will, with Parliament’s consent, bring the scheme into operation before the summer recess.

Today, I am publishing the key features of the responsible actors scheme on gov.uk and placing a copy of the information in the libraries of both Houses. The key features document sets out how the scheme will work, the likely eligibility criteria and membership conditions for the first phase of the scheme, how developers will apply to join the scheme and the prohibitions that will be imposed on eligible developers that fail to sign the contract and comply with its terms.

Developers who want to be part of the scheme will need to sign the developer remediation contract and comply with its terms. In its first phase, the scheme will focus on larger residential property developers and developers who developed multiple tall residential buildings known to have life-critical fire safety defects. Over time, I intend to expand the scheme to cover even more of those who developed unsafe 11 metre-plus residential buildings and should pay to fix them.

Eligible developers will be invited to join the scheme by a statutory deadline or provide evidence that they do not in fact meet the eligibility criteria. Any eligible developer who chooses not to join the scheme, or who is expelled from the scheme as a result of a material or persistent breach of its conditions, will be added to a list of developers who will not be permitted to carry out major development or secure building control sign-offs.

The message to those developers who have yet to sign the contract, their shareholders and investors could not be clearer. The responsible actors scheme is coming. Only developers who behave responsibly will be trusted to build the homes of the future. Any eligible developers who fail to do the right thing will need to find a new line of work.

Update on signatories to the developer remediation contract

At the time of my statement of 14 March, 11 developers had yet to sign. I named those companies and called on their directors to reflect on their future and do the right thing. Today, I can confirm that 4 of those 11 companies have since signed the contract: Ballymore, Lendlease, London Square and Telford Homes. The 7 developers who have yet to sign the contract are: Abbey Developments, Avant, Dandara, Emerson Group (Jones Homes), Galliard Homes, Inland Homes and Rydon Homes. Some of those companies have told us that they remain committed to protecting leaseholders and taxpayers from having to pay, and claim that they will sign the contract in coming days.

As I made plain last week, I will write to local authorities and building inspectors to explain the consequences for those companies that remain non-signatories at the point that the regulations creating the responsible actors scheme come into force. I will suggest action that local authorities may want to take to be prepared for implementation of the scheme, to ensure that any companies that do not wish to act responsibly do not profit from that behaviour—and that the public is protected as a result.

Given possible market sensitivities, I notified the London stock exchange about the key features document.