OFT give home builders second chance to improve consumer protection

The OFT (Office of Fair Trading) has given the home building industry another chance to introduce a code of conduct to improve customer satisfaction.

This was first recommended in the 2004 Barker Review and the industry's failure to respond resulted in the OFT Home Building Market Study.

The chances of success are significantly improved this time round, as the OFT has outlined specific success criteria and milestones for the introduction of the code of conduct. Additionally, the OFT has stated that in the event that the industry fails to make adequate progress, or fails to deliver an effective solution for consumer, it will recommend that a statutory redress mechanism is set up. Catriona Bright, New Build Inspections, comments: "Although I consider this a wake-up call for house builders, trade bodies and warranty providers, the reluctance of the OFT to recommend any legislative changes or direct regulatory intervention is disappointing. The only way to represent the interests of consumers is to introduce an independent watchdog as opposed to a continuation of the self-regulation which currently characterises the house-building industry. In short, there is simply no guarantee it will be any more successful than the previous attempt."

Regulations introduced earlier this year provide legal recognition to code of conducts, and while they do not give consumers any direct remedy, they will give regulatory bodies powers to prosecute rogue builders.

Bright went on: "From previous experience, I am not wholly optimistic about the ability of UK house builders and other interested parties to significantly improve the situation for consumers. What is clear from the report however, is that continued failure to improve will not be tolerated, a strong signal that the OFT is committed to improving standards, even if the major industry players are not".