Open consultation

Assessment of impacts

Published 14 November 2025

Applies to England

1. Strategic case for proposed regulation and summary of proposal 

Problem under consideration  

Building Control as a local authority service has been in decline for many years, resulting in services that have often become ill-equipped to support sustained major housing, public sector and commercial development ambitions and requirements. Symptoms of this include a workforce that is skewed to people fast approaching retirement, under-resourced services, and a workforce lacking in necessary skills or sufficient numbers to help the Building Safety Regulator (BSR) in its work through Multi-Disciplinary Teams in assessing proposed works regarding higher-risk buildings (HRBs).  

What evidence is there to support the problem statement? 

A search of Local Authority Building Control service websites has revealed that most services that publish relevant information operate at a significant and growing deficit. This has been confirmed through engagement with local authorities across England.  

There are a considerable number of non-chargeable activities that Local Authority Building Control Bodies (LABCBs) have to provide. This limitation means that their capacity is split between non-chargeable and chargeable work. This limits the revenue that LABCBs can generate and therefore, they are frequently not able to fund the recruitment and development of staff sufficiently; in a few cases LABCBs’ websites are saying that they do not have the capacity to handle any new building control applications. Local Government Association/LABC workforce survey in 2023 showed that there were significant levels of vacancies that local authorities were carrying.  

A key example of non-chargeable set of functions is the fact that local authorities are providing their private sector competitors, Registered Building Control Approvers (RBCAs), with a free service in checking and logging documents at the beginning and final stages in the building control processes. RBCAs provide several building control services for individuals or developers, often spanning several local authority areas, or even across the whole of England. Their compliance and enforcement activities are more limited than LABCBs, but they have to submit their documentation for various checks to the LABCB in which any given building project is located. 

Why is government intervention necessary? 

The proposed reforms seek to expand the range of chargeable functions and activities for LABCBs to support them achieve greater cost recovery and create a more competitive building control sector. These reforms will particularly bring into scope charges where LABCBs currently provide free services to their private sector competitors. Other changes will enable authorities to charge for functions and activities that facilitate better inspection and compliance. The Government’s proposed intervention to do this is through amending the regulations that set the parameters of chargeable functions and activities and how the charges are to be calculated, because this has not been done to any significant extent since 2010.   

What gaps or harms would occur if government doesn’t intervene? 

Without intervention local authorities will continue to be underfunded due to having to provide non-chargeable services and the following problems remaining. 

LABCBs are currently not resourced for checking RBCA notices. If LABCBs were able to charge, this would increase the incentive for them carry out more effective scrutiny of notices or other chargeable checking activity.  

Without this change, the lack of time spent on chargeable activities, would mean lower revenues for LABCBs. This could lead to LABCBs continuing to struggle in hiring more staff or sufficiently training staff meaning an on-going reliance on an ageing workforce whose retirement would further reduce capacity in the sector. There would be an increased reliance on the use of more expensive agency staff to fill gaps. 

Lack of capacity would continue to cause delays in building control approval, limiting the work that LABCBs can undertake (restricted to some statutory duties), and reduced scrutiny over the building control process, including minimal site visits and very low levels, if any, of requiring compliance relating to poor construction work. 

2. Description the proposed option 

Do nothing option 

Currently LABCBs are restricted by the existing ‘charging principles’ set out in regulations, which prevent them from charging for significantly more of their statutory functions, or prevent them from being able to carry them out at all.  This would continue the overall decline in capacity and, in some cases, continue the decline of compliance-seeking activity.  

Doing nothing would not take advantage of the flexibilities now available through changes to the Building Act that permit the Government to broaden the scope of chargeable activities and functions for LABCBs. 

However, the private sector RBCAs, which have fewer compliance responsibilities, are not subject to any charging regulations or restrictions and can charge for all their activities. Doing nothing would maintain the uneven playing field, with LABCB teams continuing to provide a free service to their competitors, sometimes resulting in RBCA documents not being checked within the prescribed periods set out in legislation for RBCAs.   

A do-nothing scenario would lead to the building control system becoming less robust over time.  

The preferred option: Changing the regulations to make more functions and activities chargeable 

The proposals will enable LABCBs to charge for work they currently undertake but for which they are not compensated. These proposals do not represent a direct cost to society, as the cost is already being incurred. They represent a direct transfer from RBCAs, or owners or operators of buildings to be demolished, who require LABCBs to process notices, to compensate them for work currently being undertaken without charge. However, this is expected to be passed on to consumers through higher prices, as this is an industry-wide regulation. This relates to all of the proposals outlined below. 

Costs 

Initial Notices – checks on receipt of INs 

At present LABCBs cannot charge for the checks and processing of Initial Notices (INs) submitted by RBCAs to them under section 47 of the Building Act. INs are the documents that RBCAs send to LABCBs with proposed building plans to let them know that they will be providing building control services for building work to be started in their areas. It is estimated that approximately 180,000 (100,000 – 300,000) INs are submitted to LABCBs each year. This estimate is based on the Building Safety Regulator’s (BSR) Building Control Body Key Performance Indicator (KPI) data. However, this is based only on the first return of data under Operational Standards Rules (OSRs) under recently commenced provisions under the Building Safety Act 2022. This data is undergoing a process of validation, so there is a level of uncertainty present. Assumptions have been made about the proportion of non-responses to the BSR and a wide range in the proportion of INs to be submitted by RBCAs has been added to reflect the uncertainty. The number of INs submitted is highly correlated with the size of the building stock and therefore is estimated to grow by 0.9% (this is estimated to range from 0.7% to 1.1%) per year to reflect growth across the building stock.  

Based on engagement with a sample of LABCBs it has been determined that the processing of these INs takes on average 15 minutes at a cost of £75 per hour (this is estimated to range from £31 to £100 per hour). The variability around the cost of filing these notices was based on LABCBs reporting the use of different professions or pay grades of LABCB officers for this task and considerable variation depending on each submission. The central estimate is based on the mean value while the range is based on the 10th and 80th percentiles. There is uncertainty in these estimates. 

This produces a net present total estimated cost of £31m (this cost is estimated to range from £7m in a low scenario to £68m in a high scenario) over 10 years.  

Initial Notices – invalid or rejected INs or where further conditions are imposed 

LABCBs must reject INs on some prescribed grounds, such as the building on which works to be carried out is an HRB or insufficient or incorrect information being submitted. This requires LABCBs to send a rejection notice to RBCAs and the person intending to carry out the work setting out why the IN has been rejected. The proposal is for LABCBs to charge for the preparation and sending of these rejection notices.  

In other cases, section 47 of the Building Act permits LABCBs to impose requirements as conditions on INs. These are estimated to occur in 3% (this is estimated to range from 0.7% to 5%) of IN submissions, based on BSR’s OSR KPI data, resulting in 5,500 (this is estimated to range from 800 to 15,100) INs needing further information. Similarly to above, this is based on the first return of OSR data, so a range is included around these estimates to reflect the uncertainty. They necessitate an additional 1.50 (this is estimated to range from 0.25 to 2.50) hours of LABCB time in the central scenario and cost the same as regular INs at £75 per hour (this is estimated to range from £59 to £100 per hour), based on data from LABCBs.  

This leads to a net present estimated cost of £5.5m (this cost is estimated to range from £0.1m in a low scenario to £34.0m in a high scenario) over 10 years.  

Initial Notices – Amendment Notices 

Some INs will require amending from what was originally submitted and therefore the RBCA will need to send an Amendment Notice to the LABCB. This will require additional time to check and process the Amendment Notice. As with INs, these may also be accepted or rejected on prescribed grounds or subject to imposed requirements as a condition, all of which requires officers’ time.  These are estimated to occur in 3% (this is estimated to range from 1% to 5%) of IN submissions, based on consultants’ estimates, resulting in 5,500 (this is estimated to range from 1,000 to 15,100) INs. They necessitate an additional 0.63 hours (this is estimated to range from 0.16 to 1.50 hours) of LABCB time in the central scenario and incur higher costs of £88 (this is estimated to range from £31 to £150) per hour, based on data from LABCBs. 

This leads to a net present estimated cost of £2.7m (this cost is estimated to range from £0.0m in a low scenario to £30.6m in a high scenario) over 10 years.  

Initial Notices – Extension of Time 

There are some circumstances whereby an LABCB can extend the period of an initial notice under regulation 19(7) of the RBCA regulations. The work in understanding these circumstances uses time that could be spent on chargeable work. These are forecast estimated to occur in 3% (this is estimated to range from 1% to 5%) of IN submissions, based on consultants’ estimates, resulting in 5,500 (this is estimated to range from 1,000 to 15,100) INs. This is an area of significant uncertainty. They necessitate an additional 0.41 hours (this is estimated to range from 0.2 to 1.00) of LABCB time in the central scenario and incur costs of £76 (this is estimated to range from £59 to £100) per hour, based on data from LABCs. 

This leads to a net present forecasted estimated cost of £1.6m (this cost is estimated to range from £0.1m in a low scenario to £13.6m in a high scenario) over 10 years. 

Cancellation Notices 

There are a number of circumstances under which a Cancellation Notice is either given to the LA or issued by the LA relating to the ability of the RBCA in carrying out the work  

• the nature of the work being unsuitable for the RBCA or the RBCA is unwilling to act;  

• the RBCA is of the opinion that work being carried out contravenes the building regulations and has not been rectified within a prescribed time;  

• the RBCA is subject to a disciplinary order, or its registration has been cancelled;  

• the work in an IN has not commenced within three years;  

• the LA becomes aware that the RBCA is subject to different types of disciplinary orders;  

• the work becomes work on a Higher-Risk Building (HRB), which means that the Building Safety Regulator would become the building control body at that point;  

• there is a change of RBCA. 

In some cases, the RBCA or the person carrying out the work will therefore file a Cancellation Notice with the LABCB to cancel the Initial Notice. This will require additional time from the LABCB to process the Cancellation Notice which could have been spent on chargeable work.  

In other cases, the LABCB will need to issue Cancellation Notices. Cancellations are estimated to occur in 1.5% (this is estimated to range from 0.8% to 2.3%) of all IN submissions, based on BSR KPI data, resulting in 2,800 (this is estimated to range from 800 to 6,900) INs. Similarly to above, this is based on the first return of data, so a range is included around these estimates to reflect the uncertainty. They necessitate an additional 0.40 hours (this is estimated to range from 0.16 to 1.00) of LABCB time in the central scenario and incur costs of £76 (this is estimated to range from £59 to £100) per hour, based on data from LABCBs. 

This leads to a net present estimated cost of £0.8m (this cost is estimated to range from £0.1m in a low scenario to £6.2m in a high scenario) over 10 years.  

Final Certificates 

Once a RBCA is satisfied that the work to which an IN relates has been completed, the RBCA will need to submit a Final Certificate to the LABCB12. The LABCB will then need to file the Final Certificate requiring time that could be spent on chargeable work. There are estimated to be 1.1 (this is estimated to range from 1 to 1.2) times the number of Final Certificates compared to INs, resulting in 200,000 (this is estimated to range from 100,000 to 360,000) Final Certificates in the central scenario. This is because some INs will require multiple Final Certificates. For example, a single IN can be submitted for a new housing development but if the houses are completed in blocks, each block will need to submit a Final Certificate in order to be sold. However, this is an area of uncertainty. These are estimated to require 0.42 (this is estimated to range from 0.16 to 1.00) hours of LABCB time in the central scenario and incur costs of £76 (this is estimated to range from £59 to £100) per hour, based on data from LABCBs. 

This leads to a net present estimated cost of £57m (this cost is estimated to range from £9m in a low scenario to £326m in a high scenario) over 10 years.  

Demolition Notices 

Where the whole or part of a building is to be demolished a notice of intent needs to be submitted to LABCBs before demolition can commence. The LABCB may give a notice about the intended demolition work, which can set certain conditions. If they do, they need to send it to the owner and occupier of adjacent land, the Fire & Rescue Authority and possibly some statutory undertakers for gas, electricity and water. LABCBs inside of London can already charge for the filing of Demolition Notices13 and it is estimated that a proportion of LABCBs outside of London charge for Demolition Notices too. It is estimated that there were 6,000 demolitions recorded outside of London in 2024, as per the Housing Supply: Net Additional Dwellings statistics14. However, it is estimated that 10% (this is estimated to range from 20% to 5%) of these Demolition Notices are already being charged for, based on consultants’ estimates, however this estimate is uncertain. This results in 5,400 (this is estimated to range from 4,800 to 5,700) Demolition Notices for which LABCBs are not currently charging. These are estimated to require 1.88 (this is estimated to range from 0.50 to 3.50) hours of LABCB time in the central scenario and incur costs of £67 (this is estimated to range from £31 to £100) per hour, based on data from LABCBs. 

This leads to a net present estimated cost of £6m (this cost is estimated to range from £1m in a low scenario to £18m in a high scenario) over 10 years. This would be charged to owners or operators of buildings to be demolished, and not to RBCAs.  

Table 1: Cost transfers from LABCB charging policy measures using LABCB provided costs, net present value (£m) 

Proposals	Low estimate (£m)	Central estimate (£m)	High estimate (£m)
Initial Notices	7	31	68
Initial Notices - further conditions imposed	0	6	34
Initial Notices – Amendment Notices	0	3	31
Initial Notices – Extension of Time	0	2	14
Cancellation Notices	0	1	6
Final Certificates	9	57	326
Demolition Notices	1	6	18
Total15	17	105	496

Table 2: Equivalent Annualised Net Direct Cost to Business (£m) 

	Low estimate (£m)	Central estimate (£m)	High estimate (£m)
Equivalent Annualised Net Direct Cost to Business	2	12	58

The costs calculated above largely reflect a transfer from RBCAs to LABCBs, excluding demolition notices, as these costs were covered by LABCBs through their inability to charge for this work. As a result, these costs do not represent a direct cost to society from the policy.  Any costs to society derived from greater levels of enforcement, due to increased LABCB capacity, represent current regulations being applied more consistently, not a direct impact of any new regulations. 

There are a number of other reforms included in the consultation including charges connected with securing better compliance for safer and better-quality buildings. It has not been possible to quantify the impact of these additional costs due to a lack of data and the assumed small scale of the reforms. However, we will look to produce a fuller assessment of the impacts to accompany final proposals. 

Any reforms considered under the call for evidence section of the consultation (where views on potential changes to the charging regulations are sought for consideration in a longer time frame) have not been costed. We will undertake further work to cost these elements, once further evidence has been gathered through the call for evidence.  

Benefits 

The main direct and indirect benefits of this legislative change are to deliver outcomes arising from the broader flexibility given to LABCBs through the proposed changes to chargeable activities and functions. These outcomes are complex and difficult to monetise.   

The challenge of underfunding in LABCBs appears to have arisen because they are expected to recover most of their costs through a limited set of building control charges, under the current Building (Local Authority Charges) Regulations16. These regulations do not reflect the much wider range of functions and activities they carry out.  

This could strengthen competition with private sector building control bodies (RBCAs) because LABCBs currently do more non-chargeable work than RBCAs but are competing for the same fee bearing projects.  

LABCBs should be setting the rates for their chargeable services at a level where they can cover all of their direct and indirect costs (i.e. as per CIPFA guidance from 201017, which is now unavailable). RBCAs are also setting fees to ensure cost recovery or operate at a profit, but do not undertake much of the non-chargeable work that LABCBs do (e.g. on securing better compliance) and therefore are able to achieve full cost recovery with lower fees per project.  

Therefore, in practice, because the LABCBs are in competition with RBCAs, there is sometimes a market-driven cap on the levels that can be charged for building control work, as the party which charges the greater fees will likely receive lower demand for their services.  

In cases where there is a deficit between unchargeable costs and income from charges, the suggestion from consultees is that this gap is subsidised by taxpayers through the local authority making up for the gap or simply providing a poorer service.   

Implications for the LABCBs 

After engaging with a small number of LABCBs, it has been suggested that the LABCB deficit has a number of implications which include: 

• Reduced staffing expenditure, including both wages and the number of employees 

• Reduced non-salary expenditure, such as reduced training 

• Less time which can be spent on each building control project, due to competing priorities 

• Lower quality, for example by not being as quick to respond to requests to visit a site, due to competing priorities, or missed cases of non-compliance with Building Regulations. 

Overall, this has the result of putting pressure on the ability of LABCBs to provide or maintain the quality and quantity of functions and activities needed to meet the construction ambitions that the Government has set out, for example, on increased housing supply18, remediation of unsafe cladding systems19, and for increasing and improving the stock of public sector buildings20.  

A related issue is that a significant volume of the non-chargeable work undertaken by LABCBs is servicing notices and certificates for RBCAs. Therefore, this creates a ‘public good’ externality where the service is overused because it is free. If LABCBs could charge for these processes, then this may give them more capacity to regulate the quality of these notices. 

Impacts of the policy proposals 

The main impact of the proposals will be for LABCBs to set charges for the previously non-chargeable functions paid for by RBCAs. This will increase LABCB’s revenue and help to level the playing field. This may result in increased building control fees charged by RBCAs to their clients to cover the additional charge for processing the notices.   

This aims to create a more competitive market for building control activities where LABCBs can provide better services. Therefore, this should increase choice for the consumer, the consumer being those commissioning building works. The increased consumer choice may have an impact on the price of building control services, but it is more likely to raise compliance and quality. 

Additional income from policy changes to building control should result in additional capacity, or increased training for LABCB staff. This should lead to a higher quality building control sector where notices can be more effectively scrutinised and LABCBs have more resources to undertake greater enforcement activities. This should lead to improved building quality. 

It is worth noting that because LABCBs will become more competitive, RBCAs could become less competitive because they will have increased costs to recover from their clients. This could result in RBCAs either charging higher fees, or absorbing their impact, for example by having less income available for training, etc.  If this translates into higher income, it could make LABCBs relatively more competitive resulting in potentially more work for local authorities. 

Monetisation of benefits 

As mentioned above, it has not been possible to monetise the benefits due to the uncertainty around how LABCBs will respond to increased revenue and the market response to these charging elements. However, it has been possible to estimate the value of some of the work done by LABCBs in processing notices.  

Under the existing system, we estimate that there are 5,500 (800 – 15,100) INs where further conditions are imposed. They necessitate an additional 1.50 (0.25 – 2.50) hours of LABCB time in the central scenario and cost the same as notices which were approved without conditions at £75 per hour (£59 - £100), based on data from LABCBs.  

It is assumed that charging for the time taken when considering initial notices by LABCBs will incentivise RBCAs to be more rigorous with their initial notices before submitting and the LABCB will have capacity to provide greater scrutiny. This could lead to potential efficiency gains for the LABCB. Consultants’ estimate that these efficiency savings could represent a reduction in the number of initial notices that require additional work by 15% (10%-20%).  If these efficiency gains materialised and assuming the same time taken and cost assumptions as above, this would result in a saving to LABCBs of £1m (£0.01m-£7m) over 10 years. This could then be spent on increasing capacity or providing additional training. 

The majority of benefits are estimated to fall to LABCBs through increased revenue and therefore increased capacity to undertake compliance activities and become more competitive with RBCAs when bidding for new work. This is estimated to result in greater benefits for consumers and those undertaking building works, through more choice when tendering for building control services. Additionally, there will be resulting benefits to society through higher building quality, due to improved functioning of the building control sector and increased pace of development, through greater LABCB capacity to respond to notices and applications.  

Further work to estimate the benefits will be undertaken following the consultation to accompany final proposals.    

3. Small and Micro-Business Assessment 

Most of the costs set out in this document are proposed to be charged to RBCAs and the majority of RBCAs are small and micro businesses. This is due to the nature of the firms only needing a small number of highly skilled individuals. RBCA firms that submitted to the BSR’s Building Control Body KPI data, self-reported into a number of 4-digit SIC codes such as: 

• 4339: other building completion and finishing 

• 7111: architectural activities 

• 7112: engineering activities and related technical consultancy 

• 7410: specialised design activities 

• 7490: other professional, scientific and technical activities n.e.c. 

• 8299: other business support service activities n.e.c. 

Based on the latest ONS UK business dataset, 99% or above of firms within all these SIC codes have fewer than 50 employees, and all of them are at least 92% micro businesses. This would indicate that the costs are likely to fall largely on SMEs. However, there are some high-profile exceptions such as the National House Building Council (NHBC) which acts as a RBCA for a large number of new-build developments.  

It is estimated that the costs would largely fall on these SMEs. However, we would expect the costs to be passed on to consumers of building control services through higher prices. This is because these costs would be applied at an industry-wide level which has a greater elasticity of cost pass-through than costs applied at the firm-level21.  

For businesses requiring building works there are expected to be some extra administrative and compliance costs beyond the current limited set of chargeable LABCB functions and activities. This may require RBCAs and other businesses to familiarise themselves with LABCBs’ latest charging schedules, however, the policy is not forecast to require a significant administrative burden. 

For local authorities, the proposed policies will require an increased administrative burden through updating their charging schemes and the processing, collection and enforcement of charges. However, LABCBs already have a process in place from which to issue charges and this should be able to be expanded to account for the newly chargeable elements relatively easily.