This briefing paper considers the debate about who is responsible for paying for fire safety works on blocks of flats in the wake of the Grenfell Tower fire.
This information should not be relied upon as legal or professional advice. Read the disclaimer.
Why was EWS introduced?
After the Grenfell Tower fire, the focus was on removing aluminium composite material (ACM) from buildings over 18 metres. Attention then broadened to take in other types of combustible cladding. The Government’s Advice Note 14 (December 2018) contained guidance for building owners on steps to take to tackle non-ACM materials on the external walls of high-rise buildings. Owners were advised to check “general fire precautions” and ensure that external wall systems were “safe”.
In 2019 lenders began to seek assurance on the safety of external wall systems as a condition of approving mortgage applications. There was concern that flats in high-rise blocks wouldn’t represent good security and that owners could be liable for remediation costs. In some cases, surveyors acting for lenders gave flats a value of £0, or significantly less than the asking price if the block did not have a certificate showing compliance with Advice Note 14. An increasing number of mortgage applications were rejected; sales started to fall through.
In response, the Royal Institution of Chartered Surveyors (RICS) led a cross-industry working group to consider best practice in the reporting and valuation of tall buildings within the secured lending arena with a view to agreeing a new standardised process.
The EWS1 process was agreed by the industry in December 2019 –it’s described as an “industry-wide valuation process which will help people buy and sell homes and re-mortgage in buildings above 18 metres (six storeys).”
What is the EWS process?
After its introduction, flat owners seeking to sell or re-mortgage their homes found that lenders asked for an EWS1 form. EWS1 forms are not a statutory requirement. The information gathered is used for valuation purposes. Lenders may refuse a mortgage application where one cannot be produced – this is a commercial decision.
The EWS process involves an assessment by a suitably qualified professional who completes the EWS1 form. Full information is on the RICS website.
Ongoing issues and action to address them
Although the EWS process was devised as an industry solution to ‘unstick’ the market for flats in high-rise blocks, its implementation brought other problems to the fore. On 21 November the Government announced changes to help long leaseholders. A further announcement was made on 21 July 2021 (see below).
1. Which blocks need an EWS1 form?
RICS’ initial guidance said the process applied to residential buildings in scope above 18m in height. Not all high-rise blocks needed an EWS1 form “only those with some form of combustible cladding or combustible material on balconies.” RICS advised that some lower buildings might be in scope if combustible materials/balconies represented “a clear and obvious danger to life safety”.
The Government’s consolidated Advice Note of January 2020 says, “The need to assess and manage the risk of external fire spread applies to buildings of any height.” Flat owners in blocks lower than 18 metres reported lenders requiring EWS1 forms.
On 21 November 2020 an agreement between RICS, UK Finance, the Building Societies Association and Government was announced such that an EWS1 form is no longer needed for sales or re-mortgages on flats in blocks with no cladding. The Government said this would clear the way “for up to nearly 450,000 flat owners to sell, move or re-mortgage their homes.” Supplementary guidance on fire risk assessments was issued on 21 November2020 .
…where a valuer or lender can establish that the building owner has met the advice in the consolidated advice note, an EWS1 form should not be required, nor would an EWS1 form be required for a building that is over 18 metres that has a valid building control certificate in place.
The guidance says some lower level blocks will still need an EWS1:
…in the light of the evidence received during the consultation, buildings of any height that have high pressure laminate (HPL) cladding and those of five stories or higher with combustible cladding linking balconies, will still need an EWS1 form.
There were reports of lenders insisting on EWS1 forms despite the properties not meeting criteria in the new RICS guidance.
On 21 July 2021, the Secretary of State referred to expert advice which had found “no systemic risk of fire in blocks of flats under 18 metres.” The press release set out that “EWS1 forms should not be requested for buildings below 18 metres” and said some major high street lenders had agreed to review their practices on blocks under 18 metres based on the new expert advice. The Government is “calling on others to demonstrate leadership by working rapidly to update guidance and policies in line with the expert advice.”
New guidance for external wall risk assessments will be published. The January 2020 consolidated Advice Note will be withdrawn.
2. Shortage of experts
There is a lack of qualified professionals to carry out assessments and complete EWS1 forms. The 21 November announcement included Government funding of almost £700,000 “to train more assessors, speeding up the valuation process for homeowners in cases where an EWS1 form is required.” The training has been delivered by RICS from January 2021, 880 candidates are enrolled. There was an expectation that 2,000 additional assessors would be trained within six months.
The Government is also: “pressing lenders to accept other forms of evidence on building safety to support their valuations. The EWS1 process should only be used where there is clear need, and where no reasonable assurances or regulatory evidence exists to support valuations.”
3. Professional Indemnity (PI) insurance
There are reports of the insurance industry being reluctant to offer PII to professionals completing EWS1 forms. On 21 July 2021, Lord Greenhalgh said a Government-backed PII scheme will be launched “for qualified professionals conducting external wall system assessments.” The scheme will support qualified professionals to complete EWS1 forms: “where genuinely needed, in a risk-proportionate manner and will help ensure that there is sufficient capacity in the market to allow EWS1 forms to be completed quickly, helping people to buy, sell and re-mortgage their homes.”
In early April 2021 RICS said it had secured improved insurance terms providing greater fire safety cover for PII: “Under the new rules insurers are not permitted without specific dispensation to exclude fire safety claims on a property four storeys or less.”
4. What happens after the EWS1 is completed?
There are five possible results from an EWS assessment. Category A applies where buildings have external wall materials that are unlikely to be combustible. RICS states that A1 and A2 findings “are not likely to lead to any further action.” An A3 finding means that remedial work may be needed on attachments to the external wall, such as balconies. Category B applies where combustible materials are clearly present. A B1 rating means the engineer has decided that the fire risk is low, and no remedial work is required. A B2 finding means that there isn’t an adequate standard of fire safety and remedial work/interim measures are required.
Calls for reform
In June 2020 the Housing, Communities and Local Government Select Committee (PDF 454 KB) called on the Government to “take full control” and put a fairer and faster process in place.
- Library briefing paper: Leasehold high-rise flats: who pays for fire safety work?
- RICS EWS FAQS
The Commons Library does not intend the information in this article to address the specific circumstances of any particular individual. We have published it to support the work of MPs. You should not rely upon it as legal or professional advice, or as a substitute for it. We do not accept any liability whatsoever for any errors, omissions or misstatements contained herein. You should consult a suitably qualified professional if you require specific advice or information. Read our briefing for information about sources of legal advice and help.
Following the fire at Grenfell Tower, this paper sets out the events and commentary around the fire, the relevant building regulations, fire safety laws and housing standards, the Government response to the fire, the responsibilities around re-housing, and previous concerns raised with fire regulations.
Help with long leaseholders housing questions including service charges and acquiring the freehold interest.