Developers are facing construction delays of more than 18 months and additional costs of up to £49,000 per week due to safety regulations such as the Building Safety Act (BSA), according to new data from the Purposeful Finance Commission (PFC).
A report published today by the PFC highlights how the BSA has unintentionally caused significant setbacks in the construction sector. The independent body, which brings together public and private sector organisations, warns that the stringent regulatory process is creating major barriers to housing and infrastructure development.
The report, Breaking the Cycle: Unlocking Infrastructure Investment, reveals that developers are waiting over 18 months for approvals from the Building Safety Regulator (BSR) before they can even begin construction. These delays stem primarily from the three-stage ‘gateway’ process that high-risk projects must navigate to secure planning consent, construction approval, and ultimately, occupancy.
Since the introduction of Gateway 2 in October 2023, the number of build-to-rent (BTR) homes reaching the detailed planning application stage has dropped by 41%, falling to just 17,315 between Q4 2023 and Q4 2024. The PFC argues that these regulatory delays are making many schemes financially unviable, with one developer reportedly losing up to £49,000 per week due to prolonged waiting times at Gateway 2.
In December alone, the BSR received 1,502 planning applications for high-risk buildings, yet nearly half remain undecided. Of those reviewed, more than 70% have been either rejected or deemed invalid. Meanwhile, construction starts on over 800 high-rise residential projects have been delayed, with Gateway 2 approvals now taking an average of 22 weeks—almost double the original 12-week target.
Tracy Blackwell, chief executive of the Pension Insurance Corporation and chair of the PFC, acknowledged the importance of regulatory oversight but criticised the lack of resources that is slowing progress. She said: “Regulators play a critical role, particularly in ensuring resident safety, but there is no excuse for them to be under-resourced and effectively stalling vital infrastructure and housing projects. The regulatory burden is strangling growth, and I’m delighted the PFC is focused on how regulation can better align with the government’s growth mission and drive investment into the economy.”
The report also found that nearly half (49%) of local authorities in England have reduced spending on planning, with overall planning department budgets increasing by just 3.85% per capita between 2018 and 2022.
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