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The Regs: Public sector cuts

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Geoff Wilkinson looks at how public spending cuts are likely to affect Building Control

So, we have a Conservative Liberal alliance, and public service cuts are looming – but what will that mean for Building Control? In the short term, I doubt architects will see much change at national level, as Communities and Local Government have not filled vacant posts in anticipation of future Budget cuts.

But at local government level we have not seen the same swing away from Labour, which has made significant gains in the big cities. At a recent Chartered Institute of Marketing meeting, Andrew Howard of HardHat Communications described the results as an ‘unseen earthquake in local government’.

But for architects this could be less of an earthquake and more of a pre-tremor as they wait for the Building (Local Authority Charges) Regulations 2010 to take effect. The new Regulations came into force on 1 April, but councils have six months to implement them, and almost all were waiting for the election results before making changes.

The key principles relating to the new charges are that local authorities must now achieve full cost recovery year on year and that the user should pay for the actual service they receive. As a result, the current system of charges based on value of work are likely to disappear, and instead projects will need a bespoke quote. It will also mean that councils can no longer take profits made in Building Control and siphon them off to support other services such as education, transport etc.

We can now expect to see major changes in the way local authorities charge, for example:

• Introduction of charges for giving pre-application advice to cover these costs on projects that may never go ahead, rather than balancing them in the overall budget;

• Substantially increased costs for small projects, as these can no longer be balanced by the larger projects, which should in turn reduce in price by a small amount;

• A range of factors relating to setting charges, such as reputation of builder, and type of detailing used, meaning uncertainty at pre-application stage over fees;

• A move away from fee scales towards individual fee quotes for individual projects – a £500,000 warehouse won’t necessarily attract the same fee as a £500,000 office refit;

• Introduction of supplementary charges where additional visits are required above the basic service level.

But how will councillors justify these increases to their constituencies? I suspect it will be left to architects to explain the increased costs of Building Control applications to clients. Workload may then slump as householders try to offset the increased Building Control cost by ceasing to employ architects, or avoid making applications at all.

While this may be a problem for smaller practices, it could be a boon for the larger ones, as councils seek more cost-effective service models to deliver Building Control – some multidisciplinary practices already provide a complete outsourcing option for entire planning and Building Control departments.

With the need for councils to make significant budget cuts and the new rules preventing Building Control making a profit, the incoming councillors are bound to be attracted to this option. Some have already gone down this route, for example, Breckland Council in East Anglia has transferred 56 staff by TUPE [Transfer of Undertakings (Protection of Employment)] to Capita Symonds, with a guarantee of savings. In Breckland’s case these are estimated as £4 million on a £40 million budget according to the Capita website.

Obviously I cannot predict the exact changes and these are likely to vary from one authority to another. What I can say is that there will be change, but change is not always for the better.

  • Geoff Wilkinson is a building regulations expert and former vice-chair of the Association of Consulting Approved Inspectors (ACAI)
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