Behind The Built Environment - Episode 19

David
Hello, I'm David Frise, Chief Executive of BESA. Welcome to Behind the Built Environment, the podcast where I delve into the major issues facing our industry through in depth conversations with key industry leaders. Join us as we explore the trends, challenges and innovations shaping the future of the built environment. Today's guest is someone working at the sharp end of building safety reform, helping clients, consultants and supply chains navigate the reality of the Building Safety Act.

Lilly Gallafent is Chief Operating Officer at CAST Consultancy, where she holds board responsibility for the development of people, services and operations. She's been a strong voice on the need for clients to step into their responsibilities under the Building Safety Act, championing equitable risk sharing, better procurement practises and collaborative contracts as the foundation for safer, more innovative delivery.

At a time when the regulator is reshaping how projects are planned and approved, and when questions remain about whether we're seeing true culture change or just compliance theatre, Lilly brings both strategic insight and practical on the ground experience. Lilly, welcome to the podcast.

Lilly
Great. Thank you very much. Good to be here.

David
We always start with how you came here today. Did the career choose you or did you choose the career.

Lilly
So the career definitely chose me. So I actually did a history degree and I happened to be temping one summer holiday for a quantity surveyor who I won't mention because they're not CAST, and they put me, you know, as a secretary and they put me on the Gherkin, so the Swiss Re Tower, 30 St Mary Axe. And basically in the first week I was there, they were topping out the steel and that is the most incredible piece of steel engineering. And I was just like, this is amazing. How can I be involved in buildings like this as a career. You know, I went to the people I was working with and said, how.

How do I get into this. And they said, well, become a quantity surveyor. So I did become a quantity surveyor. And that is, in fact what I did my APC in. I very quickly understood that there are many more, well, there are many interesting things about a construction project as well as how much it costs.

So almost immediately after doing my APC, I moved into project management. So that's the journey. I blame it, really, on 30 St Mary Axe.

David
There are many more interesting things than I would say in building, but there we are. So we always like to kick off with quick fire questions. Yes, no answers. That kind of sets the agenda for where we're going with this. So, yes, no, please. Do you think the Building Safety Act is genuinely driving better behaviours in the industry rather than just more paperwork.

Lilly
Yes.

David
Is the construction industry currently moving fast enough to meet the new competence and compliance expectations.

Lilly
No.

David
Do you believe clients are now taking more responsibility for building safety than they were pre Building Safety Act.

Lilly
Yes.

David
Is culture, not regulation, the biggest barrier to improving building safety outcomes.

Lilly
Yes.

David
Do you think digital tools, including AI, will become essential for Gateway submissions within the next two years.

Lilly
No, it's the timeline. If you'd given it a bit longer, I would have said yes, but the timeline, that's punchy. Although AI is moving at a rate of knots, I guess.

David
Very much so. Every couple of months it seems to have doubled in.

Lilly
So maybe I should have said yes. We'll see.

David
Let's go straight into this, then. So, from your perspective, what is the biggest behavioural change you've seen since the Building Safety Act came into force.

Lilly
It's changed many things, actually. I mean, it's changed the way we design, it's changed the way we procure, but it has, you know, those are almost secondary things to what it was setting out to achieve, which was to actually bring building safety to the front of the agenda.

And, you know, I definitely think that's happening. You know, I see that happening on the ground all the time. You know, in the pre BSA world, you know, months would go by in meetings without anyone talking about whether the building was going to be building regulations compliant or safe, really. And there was a sort of assumption by clients and project managers and people that it just, it was all going to be fine, you know, because you had an architect over there sorting it out and an engineer over there sorting it out.

Now everyone is asking the question and, you know, I sit in design team meetings where it's the first agenda item, whereas previously it was barely ever an agenda item. So it has definitely achieved that. And again, we'll probably talk about today, I think that that's probably not universally true and I think I am lucky that I get to work with a lot of responsible clients who are taking this seriously.

And that has come to the forefront of the agenda. But so I would say, you know, it's changed that substantially. The other big change that it's made is the way we procure. So obviously the requirement of a Gateway 2 application to have a lot of contractor and subcontractor input means that there is a lot more early contractor engagement than there used to be.

You know, actually, again, in the pre BSA world, I was always an advocate for that. One of the behavioural, cultural, systemic failings of our industry is this them and us thing between clients and contractors. That was really encouraged by the way we used to procure and design and build. Whereas now you've actually got contractors and clients engaging earlier in a much more collaborative way to get to an outcome that is critical to both of them, because no one can build without a Gateway 2.

So it's critical to the contractors and the client. So I would say the impact on procurement has been huge. The impact on the focus on building safety has been huge. The reskilling, I should say, of a lot of the consultants around how to design, because again, one of the things that design and build had done was encourage everyone to do the bare minimum of design and say to the design and build contractor, you sort this out.

And actually, I think the industry had de skilled itself from not really being able to do a level of design that you could build from, you know, and that clearly that skill set was there with a lot of people, but it just wasn't being utilised. So I'm definitely seeing that change a lot as well, that, you know, architects that previously would have stopped with, you know, the bare basic level of coordination are now producing, you know, information that you could almost build from, which really wasn't happening previously.

So, yeah, long answer, but it's changed a lot of things behaviourally.

David
But the answer resonates. I think anyone who listened to the Grenfell Inquiry would have heard, I assumed, probably the most frequently used word. It felt like it.

Lilly
Yeah.

David
I assumed somebody else had done it. I assumed it. And we've. So we've gone from a culture where people, as long as it looked like the building you put in for planning, then you're fine.

Lilly
Yeah.

David
And everybody assumed that everything kind of worked. But it didn't, obviously.

Lilly
No, fundamentally not.

David
You've said, I think, quite a lot, that change must start with clients. But you're aware that BESA’s recent research shows that they continue to procure on price and speed of delivery. Are you seeing any evidence of that changing.

Lilly
To some extent, we were seeing it change before in the pre Building Safety Act environment, where you had informed clients, intelligent clients that have been doing this for a long time, recognise that the cheapest price and the quickest programme actually ends up in a wildly different outturn cost to the contract sum that you signed, a programme that bears no resemblance to the original programme that you had, a culture during construction of contractors trying to recover time and money, a poor quality building because there's rushing happening.

So all of those things were true before the Building Safety Act. We have worked with clients who recognised a long time ago that the right way to, the answer is to, you know, get the right price and the right programme with the right contractor and create the right culture. So those clients do exist and they existed before the Building Safety Act.

But it is so ingrained and it goes back to what I said at the beginning, this idea that it's almost them and us, that the contractor's always trying to rip you off and therefore, you know, if you start with a cheap number and you start with a quick programme, yes, it's going to end up with a bigger number and a longer programme. But at least you started from a sort of, you know, basic point, a low point, and it's just such a mistake.

As I say, I think for some clients this has been a real shock, you know, and early in this process, the first question we were asked was, how do we avoid having to engage with contractors in this early way.

What's the alternative. And contractors were also a bit like, you know, even though a lot of contractors like being involved early, some of them, you know, it doesn't really suit their business model, which is very kind of, they hold the purse strings and they don't want that transparency. So the response initially was very much like, how do we avoid this.

How do we stick with that low price, low programme model that has been knocking around for my entire career, to be honest. And before that, I think, as I say, the informed clients have been able to allow the Building Safety Act to sort of just enhance what they were doing previously and everyone else is kind of just being forced into it because that's what the legislation does.

And this is why, I think, unfortunately, as an industry, we needed regulation to create culture change. Because, you know, again, even when I was a student, everyone was talking about, you know, them and us and procurement failure and all of that kind of stuff, and nothing happened, nothing, nothing changed. And as an industry, I think we were unable to help ourselves.

There's definitely been some problems with the way that regulation was implemented. Let's be clear that I'm not sitting here saying this was like a perfect piece of implementation and there's still going to be, I'm sure, many things coming out of the woodwork during Gateway 3, but I definitely think it has improved that procurement process.

David
In BESA, our BESA legal team are still seeing plenty of contracts that are pushing responsibility down through the supply chain. I was very struck by the Building Safety Regulator on the last call saying, don't care what your contract says, it's you they are coming for. Does that resonate. Is that something you recognise.

Lilly
You know, I'm working with clients at the moment who are on that journey and they're recognising that, you know, that they are responsible for ensuring the competence of their supply chain. Because, you know, the point about this is the building contracts are building contracts, commercial document, and it says what it says, but the legislation is legislation and, you know, it's very clearly set up to avoid everyone being able to point the finger at other people.

Again, to your point earlier, that Grenfell Inquiry, when everyone was like, no, it was. Therefore the legislation is really trying to avoid that. So principal contractors need to make sure that their supply chain are competent. And again, the intelligent ones are recognising that to one of your original yes or no questions. I think that's extremely hard to do.

There's more work and there's lots of work being done at the moment, but there is more work to be done around how do we actually measure and demonstrate competence down the supply chain. But it is going to be a really important thing because the buck fundamentally stops with the duty holders and they're not going to be able to rely on the building contract.

The Building Safety Act doesn't care about the building contract.

David
No. I thought it was a really interesting point. So, to conclude on this little section, do you think that most clients truly understand their responsibilities under the Building Safety Act or are they still really very much catching up.

Lilly
It's a mixed bag and to some extent, it depends, actually, I think, on where they were in terms of their pipeline. So there were certain clients that we worked with that, you know, they had planning for a scheme back in 2024 and they wanted to get on with it and they had to get on that journey pretty quickly.

But I still have conversations with clients now, you know, and this thing, you know, the regulations came into force in October 2023. I'm still being asked to explain to clients what their obligations are. So I really think, as with everything in construction, a little bit is people only start to think about it when it actually matters to them and at the point when they realise, okay, this isn't optional, I have to understand what my obligations are.

So that's why, you know, it was, I was really happy to support on the document that you guys produced is that no, you know, there's 100% not a universal understanding of what the obligations are by clients. And, you know, the legislation is not the easiest to read either, you know, although I've seen worse, I think.

But. So I think having something that just clearly outlines what the obligations are is really important because actually, one of their fundamental obligations is understanding their obligations. That's kind of obligation number one.

David
Yeah.

Lilly
So I would say we work with clients that have really got their head around it. We work with clients that are just starting to understand it. We do seem to have got away from the world now of how do I avoid it. People have understood now that that is just simply not possible.

David
We did it because so many of our contractor members were saying, clients are saying, no, we're paying you to do that. No, you can't. That's your responsibility. And they just didn't understand it.

Lilly
No.

David
So it was designed for the contractor to give to clients, to say, actually, I'm not making this up, this is what you need to do.

Lilly
Yeah. But I think you've got a big line somewhere in the guide that basically says, you cannot pass this on.

David
Yes.

Lilly
And I think that's the thing. Clients are so used to always being able to pass it on. And as I say, it's the difference between civil and criminal liability and all of that kind of stuff.

David
Yeah, indeed. And the other thing, I think it's really important that we start to see some enforcement with people who they would recognise in the photo. Until you see someone who looks like you, something happening to them that's not good, you don't really believe it will happen to you.

Lilly
No.

David
And suddenly you do. When it's someone that could be me.

Lilly
Yeah.

David
That can change your…

Lilly
And again, that's why, you know, the Grenfell Inquiry was, you know, very, or should have been very engaging for people in the construction industry, because everyone should have recognised themselves in that, you know, in terms of…

David
I don't think they did.

Lilly
No, I mean, you're probably right, but I remember watching the project managers there, you know, saying, God, this is, you know, this is how we work. This is a really accurate reflection of how we work as an industry. And I suppose, yeah, people don't engage. People haven't engaged with it maybe as much as they should in the industry.

David
I still hear people saying, oh, it's all to do with high rise resi. And it's cladding issue.

Lilly
Yeah.

David
It's as if Grenfell happened in another country. If you were in the construction industry at the time and subsequently and you didn't follow the inquiry, what were you doing.

Lilly
Yeah, exactly. I mean, you would have thought, just out of sheer interest, you know, it was a very public thing that happened to your industry. So, yeah, I mean, the mind boggles that you couldn't have found it relevant. But as you say, people do, you know, have different motivations.

David
They do. Well, very much so, I guess. So if we start to move on to the supply chain, how prepared do you think the supply chain is for the level of evidence of competence and compliance and just sheer record keeping that the act requires them to do.

Lilly
And the gateways, I think we've got concrete evidence already to know that they aren't ready. So I think the significant failure rate, I think it's a 75% failure rate of a building assessment certificate call in by the regulator at the moment shows that the records for our existing stock is terrible. So I think that is something, again, a bit like we said at the beginning, where we've all just historically assumed that everyone was keeping the right records because no one ever really checked it. It only ever really got checked by a facilities manager that might want to know how to change a filter in a fan coil unit.

We know for a fact that the industry record keeping is bad. It's been made transparent how ready the industry is to respond to that. Again, I see some really positive things. I'm talking to technology providers who've recognised that as a gap in the market. To your point about AI and how that can help, my biggest concern, to be honest with this whole thing, is that there is a serious risk that all we do is introduce new processes that record failure.

Because the whole point is, yes, it's great, you've got 10,000 photos of every bit of fire stopping, but has it actually been installed correctly. So I think I'm worried that there will be a confusion between record keeping and actually building something right and recording that you've built it right. And I think that's going to be a problem with Gateway 3, because I think what's going to happen is the good clients and contractors are going to put together a really huge great pack of information.

The regulator is going to spot check it and go, well, actually, I'm spot checking this and it's still not right because there's not enough energy being focused on the actual quality management of the install and checking that it's right. So I think that, yeah, I think record keeping is bad and I think, to your point, it's incumbent on everybody down the supply chain.

And I think that's the, you know, the management of that and how we, how you make sure that every labourer and every person, you know, on complex residential projects, that's a big ask to check that every single human being has installed the right thing in the right way and you've got a record of it.

So I think we're going to come a little bit unstuck with that soon.

David
Lots of people say what we need is more clerks of works and my argument would be, but that kind of delegates the responsibility. Clerk of works has not seen it, therefore I've got away with it. Surely every trade should be responsible for their own work and be able to evidence that it's compliant.

Lilly
Yeah, 100%. A clerk of works is a safety net. It's not the answer. And you know, a lot of clerk of works, you know, if you've got one clerk of works wandering around a 150 million pound construction project, they are going to miss things. And again, what's going to happen then is they're going to miss something that the regulator then picks up and then you're not going to get your Gateway 3 and then you're not going to be able to occupy the building.

So, yeah, absolutely. This has got to start with how do we actually make sure that the workers are installing the right thing at a principal contractor process level and then hopefully what you get is a regulator and a clerk of works team if you still want to have that. Just saying. Yeah, that's great, you're right, that's done.

I think there's a lot of room for improvement in the way clerk of works operates. Well, you know, less spot checking, more deep checking and more, you know, what I would actually call technical compliance checking rather than clerk of works.

David
That's really difficult because buildings are getting more and more complex and you can't, you can't. One person can't be across everything.

Lilly
You need specialists within the discipline. So we work with good businesses where they offer a sort of multi discipline clerk of works service, where you've actually got a fire specialist, you've got an MEP specialist, you've got an architecture specialist, because yeah, a lot of them historically are architects checking for aesthetics, which actually is not the thing that is causing building safety issues.

David
No. Do you think there's a danger that actually, I mean, we're very good at following very simple instructions. So make building safe for fire is the kind of principal thing. And I heard that on one of the building safety regulator calls as well. Why are we having to deal with thermal properties and acoustics, when actually you just want to make the building safe.

Are we in danger of doing that. Sealing buildings tight, value engineering the ventilation and ending up with a health issue because of mould, poor air quality at a later date.

Lilly
I don't think it's fair to say that it is just about fire, though. And I mean, the reason you have to do, you know, your acoustics and all of that is this is about building regulations compliance in its entirety. And again, that's something that I think people that don't know much about it haven't really understood.

You know, they obviously they do associate it with Grenfell, which was a fire issue, but it's got fire elements, it's got structural elements, but ultimately it's about demonstrating that the building is building regulations compliant, which should mean that the building is safe from all angles. So black mould being a perfect example. A building regulations compliant building would not end up with black mould.

But a building that has only ever been thought about from is it safe from a fire perspective and a structural perspective could well end up in that scenario. So that's why it's, you know, trying to be more holistic than that.

David
What impact is the Building Safety Regulator having on the way projects are being planned and designed and delivered before the Gateway submissions. Has it changed the whole principle of how you go about it.

Lilly
I would say that the planning process is still very much the planning process. And people often see that as the kind of the first gateway that they have to get through. And I'm not sure I would say that I've seen a lot of change in the way that that is operating or being planned for.

But I would say that immediately people are out of planning, their attention is now turning to, okay, how do I prepare for the gateways. Most employers are employing the BRPD, you know, in that immediately after planning phase, they've got the principal contractor, you know, coming on board a lot earlier. You know, there's a lot more discussion about, you know, we talked about this earlier, but subcontractor input and all of that kind of stuff.

So the design process has changed completely. We obviously, again, in the pre BSA world, everyone worked at the RIBA stages. Now we talk to clients a lot about what are your Gateway 2 deliverables. And you know, in quite a lot of projects, we run two sets of deliverables. We run the RIBA deliverables and the Gateway 2 deliverables.

A completely different approach. I always say as well that you need to have the Gateway process needs its own governance structure, it needs its own progress monitoring meetings, all of those kind of things. So it's not just, it shouldn't just be tried to be subsumed into kind of business as usual project management.

So, yeah, I would say it's completely changed the way we design. And again, I also think that actually one of the things that happened in the industry was nobody knew what they had to submit for a Gateway 2, and then they got so desperate to get an approval that they went so far down in the opposite direction and started submitting everything.

I think the thing the industry now needs to recalibrate is the question, the exam question you're being asked is, is this building regulations compliant. In order to demonstrate that you don't need to tell them the colour of the paint on the walls. And if you do, you're going to start getting yourself caught up in the change control process in construction, you're going to make your Gateway 3 approval harder.

So I actually think that, and again, this is a conversation we're having with a lot of our clients, is don't just think of this as RIBA stage 4 plus some subcontractor information, let's actually think about what is a sensible set of Gateway 2 deliverables in the same way that you wouldn't submit to a planning authority every single detail of the building because you need to give yourself a little bit of room for manoeuvre within the approval.

So, yeah, it has definitely completely changed the way we approach design, for sure.

David
Guess you still do see that in the employer's information requirements when they're asked to say, well, what information do you need at the end of the. Everything, everything, everything. And that's. Then you're searching for a needle in a haystack instead of actually thinking about how you're going to use the building and how you're going to maintain it.

So you come up with the right amount of information, not just volume of information.

Lilly
Yeah, exactly. Again, I often say to clients, let's work back from the building safety case that you need at Gateway 3, because that's your end game here, actually. And a lot of that is about how you're going to safely operate the building. And, you know, it's very clear what's needed for that building safety case.

So, you know, you've got to have a laser focus on making sure you provide that information. Not everything.

David
No.

Lilly
And the regulator can't cope with everything.

David
And do you see that the switch to a risk based process, a positive move.

Lilly
How do you mean.

David
I took this from the last building safety regulator call. He said we're going to go after the bad actors to a greater degree and move to a risk based model, so if you produced two or three projects with no problems, it'll, I'm assuming, be easier for you.

Lilly
Yeah, okay. Yeah. So look, I can see where they're coming from with that and obviously the regulators are under a huge amount of pressure to come up with ideas for how to make this smoother. But I think there's a real risk there that people fall back into bad behaviours. So I think if you are going to do that, there still needs to be some process for at least spot checking or rechecking or something.

You know, just because you've built one project well doesn't necessarily mean you're going to build the next one well, especially given construction still so human orientated. I mean I work on construction projects with the same main contractor and I have a totally different experience because it's different people doing it. So I think the idea of saying that, you know, that person is sort of competent by default is quite risky and if you are going to do it there need to be some checks and balances.

David
But I guess if you get caught out then the fines are massive anyway. You would do that. Are you anticipating major problems with Gateway 3s as they start to push through.

Lilly
I think the good news is that I don't think anyone was expecting Gateway 2 to be so problematic and everyone has said, well we can't let that happen at Gateway 3. So there's a lot more thought, I think, going in ahead of time about what Gateway 3 should look like and what good looks like.

Whereas what we had with Gateway 2 really was it didn't exist one day and then it existed the next day with no guidance, no instructions, no nothing. And then the guidance came and it followed and there's a lot more clarity around that. I think that we need to use this time now, which clearly is happening through the CLC and Build UK and all of these bodies that we work with to make this stuff happen, is that there should be more clarity about what's needed at Gateway 3.

So I think that will help. But I do think there are going to be problems for the reason that we set out earlier is that we are not good as an industry at building exactly what we say we're going to build. And that's the one test really. That's what Gateway 3 is. Did you build what you said you were going to build at Gateway 2. So I think we can do a lot more. We've got more time to do more prep work this time to try and get it right. But I still think there are going to be problems with Gateway 3.

I think there's going to be a lot of people that think that they have got it all right for Gateway 3 and find out very quickly they haven't.

David
And do you see this, this whole process bleeding through the whole of construction or down to the next level down, or do you think it'll stay pretty much where it is.

Lilly
What do you mean by the next level down…

David
In terms of gateways, say...

Lilly
In terms of expanding the scope, reducing the height threshold and that kind of stuff. I mean, I was very glad to see that Andy Rowe came out and basically said changing that HRB threshold from 18 metres to 11 metres would be madness. The process is not fit for purpose enough, smooth enough at the moment to make any big material changes.

So I wouldn't. I can see that happening at some point, but I think not until. Certainly we've got to start seeing how Gateway 3 plays out before they start applying gateways to anything else. I think hotels might be one of the first to go, I don't know, to be brought within scope of the gateways, but as I say, I don't think it's going to happen in the next five minutes.

And I think they've committed to reviewing it annually, haven't they. So I think we've got a reprieve until December of this year, at least.

David
I think so. But you would hope the culture change would. You wouldn't adopt a different culture or behaviours on other projects, you would take those into others.

Lilly
No, and I hope that people are going to start to see some of the benefits coming out of this, which would encourage them to want to use it elsewhere.

David
Well, do you see the benefits of going to design and build as opposed to build and design, which is what we've been doing. Yeah, exactly. Which is hurry scurry, very unproductive, full of errors. Are you starting to see on projects. Actually you can actually assemble a building as opposed to construct it on site, should we say.

Lilly
Yeah, definitely. We're actually signing building contracts that contain drawings you can build from.

David
Wow.

Lilly
You know, I'm not saying again that that's happening everywhere, but there's definitely been a shift towards that.

David
We've already mentioned a couple of times the BESA Client’s Guide to the Building Safety Act, which you very helpfully contributed quite a bit to. Thank you. What was the key gap in industry understanding that that guide is designed to cover.

Lilly
So I think, I mean, you made the point earlier, I think, and we touched on it, about, I think clients still have this perception that everything can always be passed on or outsourced. And so it says very early on in there that, you know, you cannot do that, you know, this is an obligation on you.

It obviously also makes the very important point that, you know, this is a criminal liability, which, again, is a big cultural change. But as I say, the purpose, the main purpose I think it currently serves is it's just digestible. People don't have to go away and try and read a piece of legislation.

They can read that guide and they, you know, they can understand it. Because actually, it's not rocket science. It just needed someone to set it out in a way that was clear. So, yeah, as I say, I think the key thing I'm expecting clients reading it to take away is like, right, I have got to take this seriously and it's not just about the PD and the PC and the project manager dealing with all, you know.

David
Well, I'm going to attempt now to summarise our conversation. You can put me right where I'm wrong, but the Building Safety Act has been a genuine driver of culture and behaviour change in the industry. There's a long way to go, but we are getting there. The industry doesn't fully, really understand what the requirements are for evidence of competence and compliance, but again, we're slowly, slowly getting there.

Clients, although they've been behind the curve a bit, are catching up and you're starting to see some genuinely better interactions with clients because they understand what they need to do. And I guess longer term, the prospects are that because we're designing more of the building before we start to actually build it, that should bring greater productivity gains and better quality and a better industry, I guess.

Lilly
Yeah, absolutely. I always say that this piece of legislation should result in safer, higher quality buildings and more certainty for clients actually around programmes and costs and things. So I think it's going to have a lot of intended and unintended positive outcomes. We're just right in the thick of it, right. With anything new, any big change process, we're still trying to work it out, but long term, I think that assuming it doesn't get completely watered down or changed by future governments or whatever, I think it can only be a positive thing for an industry that really did need a bit of a kick up the bit of a rocket.

David
Lilly Gallafent of CAST Consultancy, thank you very much.

Lilly
Thanks. Cheers.

David
Thank you for tuning in to Behind the Built Environment. Don't forget to subscribe to our podcast for more in depth conversations with industry leaders. If you enjoyed this episode, please leave us a review and share with your colleagues. Stay connected with BESA for the latest updates and insights into the industry. Until next time, I'm David Frise and this has been Behind the Built Environment.

Goodbye.