Building warrant fees: consultation analysis

6. Part 5 – Impact Assessment

The consultation included a series of questions which invited comments on if and how the proposals might impact different groups, including people with protected characteristics, businesses, and island communities, or lead to an increased impact on inequalities of outcome. The analysis of responses to these questions is detailed in this chapter.

Q5.1 Are there any proposals in this consultation which you consider impact or have implications on people with protected characteristics?

Two thirds (68%) of respondents felt that no proposals would impact people with protected characteristics. A further 22% were unsure. Overall, 6% of respondents, including 13% of individuals, felt this should be considered.

Almost four in ten respondents answered the qualitative element of Q5.1, explaining their view. The most prevalent theme was comments reiterating that there would be no such impact. While some recognised that new policies should consider the impact on those with protected characteristics, these respondents did not perceive or were unaware of any issues.

“We would assume that the Equalities Act and other relevant laws have been considered during the consultation.” – Local Authority

Some respondents queried whether the existing fee exemptions for work to a building used by a disabled person would change because of the proposals. The consensus was that these exemptions work well and should continue. One individual stated that increasing the complexity of the system could disadvantage those with cognitive disabilities.

“There are zero fees for altering or extending a dwelling for a disabled occupant and presume there would be no change to this?” – Organisation

Q5.2 Do you think that any of the proposals in this consultation have any financial, regulatory or resource implications for you and/or your business (if applicable)?

Three fifths (62%) felt that the proposals could impact them or their business. While 68% of organisations indicated this could be the case, concern varied by type of organisation, from 47% among designers/consultants to 83% of contractors/developers.

Two thirds of respondents provided further detail in open comments. The most prevalent theme was that many would support the proposals if the money raised were used solely to improve the building standards service. This was considered particularly important, given that heightened expectations of quality service provision could accompany the fee increase. Desired changes in quality included improvements in processing speeds, better auditing and verification measures and high-quality staff.

“Given the expectations being placed on [local authority] verifiers, it is vital that the necessary fees realised through any fee increase are directed towards the service areas.” – Local Authority

“I am quite content with a fee increase if the service I receive improves proportionally.” – Individual

The next most prevalent theme was a potential increased financial burden. Additional costs for local authorities included administrative and training requirements and additional IT expenditure e.g. changes to software to capture new fee structures. Local authorities who raised insufficient income from fees to cover Hub costs could also be disadvantaged. Contractors/developers highlighted several recent regulatory changes which they argued have already added to the overall financial burden of delivering projects.

“The home building sector continues to be impacted by a number of economic factors and upcoming Scottish Government changes to policy/regulations. We estimate the increase in building warrant fees to be around £70-75 per home in large volume developments. This is yet another cost burden to the delivery of new homes.” – Organisation

Several respondents highlighted the potential for increased workload for building services. Concern was expressed that service quality could further decline, e.g. increased delays. This could occur due to an increased volume of enforcement activities, such as additional on-site verification and recording or higher expectations and contact from customers. A local authority estimated that eight additional posts would be required to meet expectations arising from the new Compliance Plan approach. One organisation suggested that speeding up approval systems could offset higher development costs, whilst others called for a longer lead time to allow changes to be made.

“Introducing the Compliance Plan Manager (CPM) role and more rigorous compliance mechanisms might require additional administrative resources and time, leading to potential delays and increased overheads in project delivery.” - Organisation

Other potential impacts arising from the proposals were highlighted by several respondents. With fewer people choosing to renovate or move due to increasing costs, some consultancy firms anticipated fewer clients. Increasing costs could make construction projects less viable, particularly in areas where valuations are lower and profit margins are slim. Should domestic clients choose to circumvent the system and not apply for a building warrant, greater enforcement activity may be necessary. One individual also highlighted that local fee setting could be problematic for those working across local authority boundaries.

Q5.3 Do you think that any of the proposals in this consultation have any impact or implications on island communities?

Many respondents (46%) were unsure whether the proposals could affect island communities; 31% did not think there would be an impact, and 18% felt there could. Views varied considerably by organisation type, with 71% of local authorities and half of contractors/developers unsure, 63% of designers/consultants stating no, and mixed views being held by the small number of membership bodies.

Just under a third of respondents provided additional comments on whether the proposals might impact island communities. The main view expressed was that an increase in fees would further add to a greater financial burden for island communities compared to the mainland, given that material costs or associated transportation costs are typically already higher, and could hinder further development. Other impacts identified by a few were that decisions would take longer due to longer travel times, difficulties attracting and retaining qualified staff and fewer complex warrant applications resulting in reduced income. Suggestions to overcome these issues included applying fee structure adjustments and offsetting reduced income streams.

“Transporting materials and specialists required for compliance may incur additional costs for island projects.” - Organisation

“HRB's are less prevalent in island communities and therefore the local authority involvement may be significantly different from those in mainland authorities. Island authority's will therefore see significantly less income from these types of applications. Suitably qualified CPM will be necessary for HRBs, and these people are not in abundance in island communities. This may mean a more burdensome requirement for the local authority as our involvement could be misinterpreted and a clear understanding of the verifier role is essential.” – Local Authority

Some felt that island communities would not be impacted differently from others or that islanders should be consulted to determine their opinions. Two mainland local authorities felt they faced similar issues with island communities and called for these to be recognised. For instance, one local authority building standards team called for local authority contributions to nationally recognised services to be based on their annual fee income rather than assuming a standard fee income should apply to all authorities.

A small number highlighted possible positive impacts.

“Island communities, due to their remote location, benefit significantly from access to the Building Standards Hub. The allocation of fees to support the development and maintenance of the Hub is particularly crucial for island communities like ours. It ensures that we have access to essential resources and information, which can be more challenging to obtain when situated far from other authorities.” – Local Authority

“When completely developed, the system's enhancements and maybe more resources—especially digital and RVI—might offer a greater value.” - Organisation

Q5.4 Do you think that any of the proposals in this consultation have any impact on the inequalities of outcome caused by socio-economic disadvantage?

Half (49%) of respondents did not think the proposals would impact socio-economic inequalities, while one quarter (28%) were unsure and 18% felt they would. While half of local authorities (50%) were unsure, half or more of other types of organisation indicated there would be no impact.

Around a third of respondents provided additional detail in Q5.4. The most prevalent view was that at an individual level, increasing the fee alone was unlikely to impact those affected by socio-economic disadvantage.

“The Warrant Fee is a fraction of the overall cost of works when compared to construction costs and professional fees. The customer will have addressed any socio-economic considerations they might have prior to point of building warrant submission.” – Local Authority

At a population level, however, it was argued that fewer building warrant applications could be made in remote areas or areas with low valuations or tight margins, which in turn could impact local authority building standards teams’ income. A local authority queried the impact of increased fees on its housing emergency but did not elaborate on this.

The next most commonly mentioned theme was that the greater financial burden could prevent people affected by socio-economic disadvantage from improving their homes. A few argued that those impacted by socio-economic disadvantage may circumvent the regulations and not apply for a building warrant.

A small number made suggestions for improvement, notably allowing for a reduction in fees based on personal circumstances or extending the existing fee exemption to all households with a disabled person (i.e., not just disabled adult applications as at present). However, one local authority building standards team argued that establishing a system that allowed for consideration of reduced fees would be an ‘extremely difficult process’.