Fighting back against Red Tape - John Williams

In the last issue of Flat-Living I started off by saying ‘I like to think of myself as a fairly placid person . . .’ I wish to retract that statement, and let me tell you why:

Red Tape: the excessive regulation or rigid conformity to formal rules that is considered redundant or bureaucratic and hinders or prevents action or decision-making.

or

Red Tape: something which entangles every aspect of running a residential block by the use of sometimes excessively complex procedures and seemingly ever-changing statutory provisions, meaning you have to stay on the ball just to keep up with the latest legislation before you can even start on your days work!

The sheer number of regulation changes in recent years has been staggering – more than 34 at the last count - and they impact on all of us involved with the management of, or owning a flat in, a residential block.

A reminder of a few of the areas affected include: ground rent notices; consultation procedures for major works; service charge demands; administration charges; forfeiture; asbestos; risk assessments; digital switchover; Trust tax; fire safety; regulation of insurance; electrical, gas and water testing; rules for appointment of contractors; no smoking; and health and safety, etc.

Of course - as Flat Living reports elsewhere in this issue - proper regulation and adhering to best practice is good, but sometimes it seems that bureaucracy has gone mad. Rules for this, checking procedures for that, forms and rigorous inspections to ensure everything we do is controlled and monitored. It would seem, from what we learn of late, that not even the financial services sector has to jump through quite as many hoops as managing agents, and yet we still tend to get lumped together with those who do not comply (or even know about) best practice, and are generally lambasted for being charlatans and thieves!

It is not that I don’t agree with all the changes. Most are long-overdue and provide better protection for leaseholders. What I do not agree with is how burdensome and costly it has become in a relatively short space of time, and this ridiculous concept that anyone with an interest (ie deepest pockets) is deemed culpable. What set out to benefit leaseholders has led to increased service charge expenditure to simply meet the various statutory requirements. That said, the cost of non-compliance can be far higher with large fines and, in the worse cases, custodial sentencing. Last year a managing agent was fined £100,000 plus costs of nearly £13,000 for serious fire safety breaches. So our job is to ensure the leaseholders and resident management companies are made clearly aware of the importance of compliance and make the whole process as easy and cost-effective as possible.

So here I am on top of my red soapbox again. I am grateful to find you still reading this - and equally grateful to discover the government has set up the Red Tape Challenge. This is about harnessing the experiences and ideas of those who have to deal with regulation to help cut the red tape. A website has been set up to gather feedback on which regulations should stay, and which can be merged or scrapped. Every few weeks regulations are published on the site relating to a specific sector, as well as across all sectors. Comments left will be collated to provide a clearer picture of which regulations should stay or change. Ministers will then have three months to work out which they want to keep and why. But, the default presumption will be that burdensome regulations will go. If ministers want to keep them, they have to make a very good case for them to stay. This process started in April 2011 and will last until April 2013 (www.redtapechallenge.cabinetoffice.gov.uk). So, if you, like me, are getting increasingly frustrated by the red tape – tell them about it, simply getting it off your chest really helps!

Providing our expertise as managing agents is about giving a professional service which protects our clients’ interests and their property. Unfortunately if leaseholders are not willing to comply with the various testing and inspection requirements, I believe the responsible thing to do is to resign from the contract. I can moan about red tape, but I cannot ignore it and I certainly would not risk our reputation, or ultimately prosecution, knowing that the buck stops with us as the experts.