Ministers plan law to order independent reviews of RICS governance

Ministers are planning to legislate to give government the power to order regular reviews of the Royal Institution of Chartered Surveyors’ (RICS) governance.

The Department for Levelling Up, Housing and Communities (DLUHC) has today confirmed more detail about housing secretary Michael Gove’s pledge to “take powers” to review RICS, first alluded to in a speech on Monday.

A spokesperson for DLUHC said: “We are planning to legislate to give government the ability to periodically commission independent reviews of RICS’ governance and to publish the report of such reviews.”

Ministers have been frustrated by RICS’ decision in December to maintain its current advice to require controversial EWS1 forms on blocks under 18m in some circumstances with the DLHUC  accusing the organisation of ‘lacking ambition’ to solve the problem. RICS said its decision was in the public interest as purchasers might otherwise be passed on costs unwittingly in some circumstances.

EWS1 building safety information forms have been blamed for preventing homeowners selling their properties and ministers called for a more “proportionate approach” to risk.

On Monday, Gove said the government would take powers to review RICS governance and then added: “Those in the industry who refuse to work with us in good faith to take a more proportionate approach should be clear that our determination is to fix the problem for all those caught up in this crisis.”

Former housing secretary Robert Jenrick on Monday said RICS had “failed to make good” on discussions to take a more proportionate approach and asked the housing secretary what steps government will take about RICS because its behaviour is “bordering on scandalous”.

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Gove suggested discussions with RICS have been more positive lately. He said: “There have been all sorts of difficulties with that organisation in the past, but I am now hopeful that we are on a more positive footing.”

Gove added: “On EWS1 forms, we can dramatically reduce their use as a result of the engagement that we have with lenders and with RICS. Again, it will still be the case that, in the meantime—even as we get a more proportionate approach—there will be some 11-to-18 metre buildings where work of that kind will be required, but we absolutely want to reduce it.”

On Monday, RICS issued a statement saying the organisation has “consistently taken a proportionate approach to valuation-guidance which is evidence-based and supported by all market participants”. It pointed to data this week showing EWS1 form use is falling as a result.

It said: “We will continue to work with valuers and lenders to ensure that a proportionate approach is being applied consistently in practice and RICS’ standards and regulation board will keep the guidance under review.”

The government this week removed its consolidated advice note, which was interpreted to mean EWS1 forms should be used on all residential tower blocks. It is instead urging the use of a new standard developed by the British Standards Institute – PAS 9980:2022. 

Separately, the RICS has commissioned peer and former civil servant Michael Bichard to carry out an independent review of the organisation’s purpose, governance and strategy following a governance crisis at the organisation. Lord Bichard’s call for evidence closes on 21 January.