Summary of new and proposed legislation (UK Construction Focus, July 2020)

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Dentons' UK prepare a monthly guide to new and proposed legislation that will affect the construction industry for publication in Construction Law's "state of play" table. The July 2020 update is below.

Information contained in our COVID-19 articles and publications is correct at the time of print. This is, however, a constantly evolving situation across the globe and specific advice and guidance should be sought as required.

House building
New Homes Bill Help to Buy
  • With 15% of greenhouse gases coming from the residential sector, The New Homes (New Development Standards) Bill will require residential developers to meet minimum standards of provision for insulation as well as broadband connectivity and electric car charging points in new homes. The bill, which had its first hearing in the House of Commons on 30 June 2020, will help the government achieve its ambitious net zero carbon emissions target by 2050.
  • Homes England has announced that its Compliance Audit programme for 2020/2021 is now proceeding. All organisations selected for audit will be contacted with full details of the plan for this year’s programme. Updated guidance has been published to reflect this year’s programme requirements: Compliance Audit. The Compliance Audit applies to those organisations which receive funding under Homes England affordable housing programmes and provides assurance that policies, funding conditions and procedures are followed.

 

Innovation in transport
New programmes
  • Highways England is spearheading the launch of a 15-year plan to accelerate the use of technology in infrastructure: 15-year vision set to revolutionise construction. Connected and autonomous plant (CAP) is already transforming activities in the construction sector and the new roadmap sets out a vision to establish CAP techniques as standard industry practice by 2035. Productivity improvements could exceed £400 billion by 2040 and lead to reduced fatalities.
  • I3P reported on the new programme designed to drive innovation across major infrastructure projects in the UK as launched by Minister of State, Andrew Stephenson. "The Transport Infrastructure Efficiency Strategy Living Lab (TIES Living Lab) is a transformative collaboration aimed at harnessing the vast quantities of intelligence that UK infrastructure projects generate, that can help identify modern methods of construction – driving down delivery times, reducing our carbon footprint and improving safety and skills for construction workers." A partnership of more than 30 key partners including the government, CLC, the Environment Agency and academic partners will invest more than £16 million in new tools, processes and data systems to build on and establish best practice in how we design, build and integrate innovations within transport assets.

 

H&S
Improving building safety (Wales) The Welsh government has published its proposals for the reform of its fire safety and building safety regimes for consultation in Building safety: position statement (19 June 2020). A White Paper will clarify where the Welsh government intends to depart from the UK government's intended reforms. There are similarities between the two government's building safety regimes and the statement confirms that the Welsh reforms to the building safety regime will be consistent with those of England. However, it appears that the Welsh fire safety regime will go significantly further than England's proposals with a new regime focused solely on dwellings. The consultation will focus on the range of 18 metre plus buildings to which the regime should apply (residential or wider?); whether to require a local authority acting as the client under CDM 2015 to use a different building control body to avoid conflicts of interest; and whether to impose new responsibilities on residents.

 

Modern slavery
New contract to help victims of modern slavery The government has awarded a new contract to The Salvation Army to provide a service that better meets the needs of victims of modern slavery, including those with specialist and complex needs (The new Modern Slavery Victim Care Contract). The new contract is part of the government’s ongoing efforts to improve the system of identification and support for modern slavery victims. It will "allow for more specialised services to meet those needs, including varied accommodation and improved support for those with complex requirements" as well as "introduce journey plans to help victims work with their support worker to recover from and reflect on their experiences, and then begin to move on to independence outside of the service".

 

Corporate administration
Filing requirements –temporary measures due to COVID-19 Following the delayed implementation of the off-payroll working rules (IR35) implementation, the The Corporate Insolvency and Governance Act 2020 (the Insolvency Act) came into force on 26 June and deals principally with insolvency matters (see the commentary for more information).

However, the Insolvency Act also contains several temporary provisions to give companies more flexibility during the pandemic − mainly around how meetings are held.  The

Companies etc. (Filing Requirements) (Temporary Modifications) Regulations 2020, made under the company administration provisions of the Insolvency Act, came into force on 27 June 2020 and are currently set to expire on 5 April 2021 (but can be extended by secondary legislation). The regulations extend a range of filing deadlines for companies and other entities registered at Companies House, including:
  • the 14-day deadline for submitting notice of certain event-driven filings (for example, a change of director, registered office or person with significant control) which is extended to 42 days;
  • the accounts filing deadline which is extended by three months to 12 months after the end of the relevant accounting period for private companies and nine months after the end of the relevant accounting period for public companies;
  • the deadline for the annual confirmation statement which is extended from 14 days to 42 days after the end of the company's confirmation period; and
  • the 21-day deadline for registering a charge against a company's assets which is extended by 10 days to 31 days. 

[You can read more about the company aspects of the Insolvency Act here.]

 

Tax
CITB levy (measures due to COVID-19) The Construction Industry Training Board (CITB) has confirmed that the three-month suspension of levy contributions announced in March 2020 to help employers recover from COVID-19 will continue until September 2020. Businesses will then have up to a full year to pay the 2020/21 levy, meaning that employers will only have to pay 18 months' rather than 24 months' levy. It is hoped that this reduction will protect apprenticeships and direct funding to employers, and the grants scheme. The CITB published its business plan in its Skills Stability Plan 2021 which sets out a revised approach to the 2020/2021 financial year to reflect the effects of COVID-19. It is intended to protect apprenticeships and provides "direct funding to employers to adopt new ways of working needed in the wake of COVID-19".

 

Delay to introduction of VAT reverse charge – Order now made The Value Added Tax (Section 55A) (Specified Services and Excepted Supplies) (Change of Commencement Day and Amendment) (Coronavirus) Order 2020 (SI 2020/578) was made on 8 June 2020 and comes into force on 20 July 2020. The order will delay the introduction of the VAT reverse charge on construction services from 1 October 2020 to 1 March 2021. (See Revenue and Customs Brief 7 (2020): domestic reverse charge VAT for construction services – delay in implementation (5 June 2020) and HMRC's Guidance: Domestic reverse VAT charge for building and construction services.) Note that businesses wanting to be excluded from the reverse charge on the basis that they are end users or intermediary suppliers (excepted suppliers) will have to notify their sub-contractors in writing before making a supply to ensure certainty as to whether the supply is excluded from the reverse charge.

 

Tax (COVID-19 measure)
Planned deferral of Community Infrastructure Levy
  • The MHCLG has updated its guidance for local authorities on Community Infrastructure Levy (CIL) matters: Coronavirus (COVID-19): Community Infrastructure Levy guidance (30 June 2020). (See last month's state of play for more on the initial guidance published on 13 May 2020.) The CIL is a levy which local authorities can impose on the new development of land. The guidance, which applies in England, explains how the Community Infrastructure Levy (Coronavirus) (Amendment) (England) Regulations 2020 will operate.

 

Building Information Modelling (BIM)
BIM information protocol BSI, The Centre for Digital Built Britain (CDBB), the UK BIM Alliance and the Construction Industry Council (CIC) have published the Information Protocol to support BS EN ISO 19650-2 the delivery phase (see the CDBB press release). Intended as "an essential companion to BS EN ISO 19650-2", this guidance will enable a deeper understanding of the international BIM standards. The Information Protocol has been developed as part of the BS EN ISO 19650-2:2018 requirements and provides an example of what could be included in an Information Protocol to be used when confirming to BS EN ISO 19650-2:2018 for projects and their appointments.

 

Procurement
PPN 04/20

Infrastructure and construction pipeline

Outsourcing Playbook

  • The Cabinet Office, Efficiency and Reform Group, and Crown Commercial Service have updated the government webpages setting out the Procurement policy notes to include Procurement Policy Note 04/20: Recovery and Transition from COVID-19. This collection collates all procurement policy notes, providing guidance on best practice for public sector procurement.
  • The Infrastructure and Projects Authority has published National Infrastructure and Construction Procurement 2020-2021 Pipeline which sets out planned social and economic infrastructure procurements. Going a step further than the 2018 National Infrastructure and Construction Pipeline (which detailed planned investment to 2021), it details the contracts planned to be brought to market in 2020-2021 to help recover from COVID-19. The report sets out information "at a more granular level than ever before … to provide industry with better visibility and certainty of current and future project flow, in order to help companies rebound from [the COVID-19 pandemic]". The short-term procurement projections are intended to boost market confidence and help with business planning during this challenging period. The procurement pipeline workbook includes details for more than 260 projects and programmes with procurements planned for this year, and can be found here: https://www.gov.uk/government/publications/national-infrastructure-and-construction-procurementpipeline-202021. A full National Infrastructure and Construction Pipeline is due later in the year.
  • The government's Outsourcing Playbook, designed to make sure government and the private sector work together well and to help guarantee good services, has been updated. "The Outsourcing Playbook contains rules, principles and guidance on how government departments should make decisions about outsourcing projects, making sure the focus is always on delivering the best possible outcome at the best possible value for the public." The updates highlight the importance of continuing to drive forward innovation in public sector projects, including the creation of Delivery Model Assessments (DMAs). DMAs help "determine whether the public or private sector is best placed to deliver a public service, an improved focus on delivering social value in contracts and guidance on building and maintaining successful relationships with companies delivering services".

 

Construction products
European Commission review The European Commission is reviewing the regulation on the marketing of construction products. Regulation (EU) No. 305/2011 of the European Parliament and of the Council of 9 March 2011 laying down harmonised conditions for the marketing of construction products and repealing Council Directive 89/106/EEC Text (The Construction Products Regulation or CPR) enables the free movement of construction products in the EU by providing harmonised conditions for their marketing. The EC will review the CPR and address issues identified in an evaluation carried out in 2019. It will also consider how to improve the function of the single market for construction products. "The aim is to unlock the sector’s growth and jobs potential, promote environmental goals as part of the Green Deal and Circular Economy Action Plan, and possibly promote product safety". Comments can be provided before 19 August 2020 here: https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12458-Review-of-the-Construction-Products-Regulation. Further background on the problems identified relating to the CPA can be found in the Inception impact assessment: Ares(2020)3153709.

 

Climate change
Various updates
  • Defra has issued its 25 Year Environment Plan progress report: April 2019 to March 2020 (12 June 2020). The report is the government’s annual account on how it has implemented its commitments to protect and improve the environment since the plan was first published in 2018. Key achievements include: the introduction of the Environment Bill, strengthened Agriculture and Fisheries Bills; a new legal foundation for government action to improve the environment; being the first major economy to legislate for net zero; and launching a consultation on bringing forward the date for the end to the sale of new petrol and diesel vehicles (including hybrids for the first time).
  • The Chancery Lane Project (TCLP), made up of independent and politically neutral legal professionals, published the second edition of its Climate Contract Playbook and a Glossary of key climate terms. The updated Playbook includes 13 new precedents for use in a wide range of documents to take account of climate risks (for example, in non-disclosure agreements and green shareholders' agreements).
  • In a letter to the Prime Minister and the First Ministers of Scotland, Wales and Northern Ireland on 6 May 2020, the Committee on Climate Change (CCC) set out its six key principles to rebuild the nation following the COVID-19 pandemic whilst delivering a stronger, cleaner and more resilient economy. The CCC has now submitted its 12th annual progress report under the Climate Change Act 2008 to Parliament detailing the policies needed to underpin those six principles for building a climate change focused recovery from the COVID-19 crisis and the recommended actions required by all key government departments. Recommendations include the need for the Environment Bill 2019-21 and Agriculture Bill 2019-21 to be strengthened.
  • The Oil and Gas Authority (OGA) is consulting on its intention to refresh its core aim, including a requirement for industry to help the government achieve the target of net zero greenhouse gas emissions by 2050.  The consultation ends on 29 July 2020.  See Consultation on new OGA Strategy.
  • The Department of Business, Energy and Industrial Strategy (BEIS):
    • has reported on the outcome of its consultation into the energy efficiency scheme for small and medium-sized businesses (23 June 2020). In its Clean Growth Strategy, BEIS sets out its ambition to work with businesses to improve their energy efficiency by at least 20% by 2030. The consultation asked for feedback on three indicative options: energy efficiency auctions; a business energy efficiency obligation; and access to finance;
    • has announced an £80 million boost to cut emissions from homes and industry (29 June 2020) with the first phase focused on helping heavy industry go green and helping to cut energy costs, protect jobs and cut carbon emissions;
    • has appointed three contractors to demonstrate the feasibility of a large-scale roll-out of heat pumps in Great Britain by installing heat pumps in a representative range of 750 homes as part of the Electrification of Heat Demonstration Project (29 June 2020);
    • has awarded a total of £1.8 million grant funding to three organisations in the Green Home Finance Innovation Fund competition to provide funding to projects which develop innovative green mortgages and other lending products; and
    • is consulting on the future role of efficient co-generation of heat and power to support achievement of the government's net zero emissions target by 2050. The Combined Heat and Power (CHP): the route to 2050 consultation, which reviews the current benefits from CHP, its future role in achieving net zero greenhouse gas emissions by 2050 and how it might support the decarbonisation of heat and industry, ends on 4 September 2020.

 

Planning
 
  • The Business and Planning Bill 2019-21 (the Bill) is being fast-tracked through Parliament with its first reading in the House of Commons on 25 June 2020 and its second reading in the House of Lords on 6 July 2020. It includes measures to support businesses with their post-COVID-19 recovery plans, including the implementation of safer ways of working to enable social distancing. Its measures include new planning processes to enable developers to vary site working hours temporarily; the extension of certain planning permissions and listed building consents; the temporary removal of requirements for the Mayor of London to make the current Spatial Development Strategy available for physical inspection and to provide hard copies on request; and giving the Planning Inspectorate flexibility to use more than one type of procedure when dealing with a planning appeal to speed up the process (in England only).
  • The MHCLG has issued Draft planning guidance to support the Business and Planning Bill to be read alongside a number of the planning measures set out in the Bill, including:
    • Extension of certain planning permissions: draft guidance (6 July 2020) which provides further detail on the extension of certain planning applications and the Additional Environmental Approval process introduced in the Bill;
    • Draft guidance – making current spatial development strategies available digitally which provides guidance on mitigation measures the Greater London Authority could adopt to assist those who are unable to access the London Plan in the Bill by reasonably convenient electronic means; and
    • Draft guidance: construction site hours deemed consent which provides further detail on the proposed new fast-track route for applicants seeking to extend construction site working hours (under [proposed] section 74B of the Town and Country Planning Act 1990) as introduced in the Business and Planning Bill. The proposals will facilitate swift changes to construction working hours to support safe construction working in line with the government’s latest social distancing guidance on construction and other outdoor work. The guidance also guides local authorities on what to take into account when determining applications.
  • The Prime Minister has announced "radical reforms" to the planning system: PM: Build, Build, Build to make easier to build better homes where people want to live. Changes include: flexibility for more types of commercial premises to be repurposed through reform of the Use Classes Order (but excluding pubs, libraries, village shops "and other types of uses essential to the lifeblood of communities"); a wider range of commercial buildings able to change to residential use without planning permission; planning permission no longer needed to demolish and rebuild vacant and redundant residential and commercial buildings if rebuilt as homes; and property owners to be able to build additional space above their properties via a fast-track approval process, subject to neighbour consultation. (See https://www.gov.uk/government/news/pm-build-build-build.)
  • The Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020 come into force partly on 25 June 2020, and fully on 1 August 2020. The regulations will allow development to assist in supporting the government’s economic renewal package following the coronavirus outbreak. Further, they: provide an additional allowance for the temporary use of land from 1 July 2020 to 31 December 2020; introduce a new permitted development right to allow a local authority to hold a market for an unlimited number of days without the requirement to submit an application for planning permission beginning with 25 June 2020 and ending with 23 March 2021; and introduce a permanent permitted development right to allow additional storeys to be constructed on existing purpose-built blocks of flats to create new homes. (See the explanatory memorandum.)

 

Previous editions can be found here:

Summary of new and proposed legislation (UK Construction Focus, June 2020)

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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