Fixed Recoverable Costs Stocktake: What Happens Next?

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The Government’s Stocktake of the Fixed Recoverable Costs (FRC) regime closed on 5 January 2026 and in due course will inform the ongoing debate around legal costs, proportionality and housing disrepair claims.

Originally introduced as part of wider Civil Justice reforms in October 2023, the expanded FRC regime aimed to make litigation costs more predictable and proportionate across a range of civil claims. However, housing disrepair claims were excluded from the reforms due to concerns around complexity, expert evidence and access to justice for vulnerable tenants.

Now, with the Ministry of Justice (MoJ) reviewing how the wider regime is operating in practice, the Housing Sector is watching closely.

 

What is the FRC Stocktake?

The Stocktake was launched by the Ministry of Justice (MoJ) to assess how the expanded FRC regime introduced in October 2023 is working in practice.

The Stocktake, or 'review', seeks feedback on:

• Whether the reforms are delivering proportional legal costs
• How different claim types are functioning under fixed costs
• Whether there have been unintended consequences
• Whether further changes or refinements are needed

 

The process forms part of a broader review of civil litigation and dispute resolution across England and Wales.

 

Why does this matter for housing disrepair claims?

Although housing disrepair claims currently remain exempt from an FRC regime, the issue matters because legal costs in disrepair litigation have become an increasingly controversial topic.

Social landlords have argued that:

• Legal costs are often disproportionate to the value of repairs themselves
• Significant sums are being diverted away from investment in homes and services
• Some claims are being pursued with weak evidence or poor professional oversight

 

At the same time, claimant representatives and tenant groups have warned that bringing disrepair claims into an FRC regime too quickly could:

• Reduce access to justice
• Discourage solicitors from taking on complex or lower-value cases
• Leave vulnerable residents without representation

 

The debate is therefore not simply about costs, it is also about balancing:

• fairness
• accountability
• access to justice
• proportionality

 

What have stakeholders said?

The Civil Justice Council and wider legal sector have continued discussing the risks and benefits of extending fixed costs into more specialist claim areas.

The Law Society has stated its key views in its response to the Stocktake, reiterating that it does not oppose a FRC for disrepair claims in principle subject to certain conditions being met, although it believes the consultation is 'rushed'.

It has also stated its recommendations, which include:

• More judicial guidance and training for decision-making in relation to bands
• Further guidance on vulnerability rules
  
• Uprating FRCs in line with an appropriate evidence-based index

 

Meanwhile, the Solicitors Regulation Authority (SRA) has intensified scrutiny of high-volume consumer claims work, including housing disrepair litigation, through its thematic review and ongoing investigations into legal conduct.

At the same time, many claimant firms continue to argue that disrepair claims are uniquely complex and should not be treated in the same way as more straightforward civil claims.

 

What has changed since the 2023 reforms?

One of the most significant developments is that the Government has controversially confirmed that the exemption preventing housing disrepair claims from entering the FRC regime will continue until at least 2028.

This extension recognises that disrepair claims often involve:

• expert surveyor evidence
• vulnerable residents
• safeguarding concerns
• ongoing health risks such as damp and mould

 

However, the extension should not be viewed as the end of the debate.

Alongside the Stocktake, the Government’s Call for Evidence on Housing Disrepair Claims, the SRA’s thematic review and several high-profile court decisions suggest that the wider disrepair litigation landscape is under active scrutiny.

 

What happens next?

At the time of writing:

• No decision has been made to extend FRC into housing disrepair claims
• No final reform package has been published
• No major changes to the Pre-Action Protocol have been confirmed

 

Across the sector there is growing emphasis on:

• earlier dispute resolution,
• stronger evidence and inspections,
• proportionality in litigation,
• and better complaints handling before legal escalation.

 

Why does this matter?

Whether or not housing disrepair claims eventually enter a FRC, the Sector is moving towards greater accountability, stronger evidential standards and increased pressure for early, proportionate resolution.

 

How can DISREPAIR AWARE help?

Many rented homes are not inspected regularly or maintained properly - we want to help improve housing conditions for everyone.

We help tenants and leaseholders understand their rights and get support and help registered providers, private landlords and managing agents to understand their obligations and get compliant.

You can find more news and insights about housing disrepair on our Blog.