By Bernard Hickey
Building and Housing Minister Nick Smith has asked his officials to consider expanding the current list of exemptions for gaining building consents that would allow licensed building practitioners to 'self-certify' certain types of building work.
His comments come after the release of the 'Loopy Rules Report' by the Rules Reduction Taskforce, which recommended the speeding up of risk-based consenting, the simplication of consenting for minor structures and the increased use of building consent exemptions under Schedule 1 of the Building Act.
Smith also said the Government was considering a Law Commission recommendation from June last year that would cap Council liability for building failures at NZ$300,000 per dwelling. That would reduce the potential liability carried by Councils for building failures, he said. The Government was also looking at an officially sanctioned building guarantee scheme to provide some backup for building owners where self-certification led to problems, he said.
"I have asked officials to go away and explore those (Schedule 1) extensions and see whether there are further areas where we can reduce red tape," Smith told reporters in Parliament after the release of the report.
"I think it is about getting the balance right. We want affordable homes. We want good quality homes. So where we can get rid of red tape that is not needed to maintain quality, but can reduce the frustrations for builders and for homeowners, we should do it," he said.
"But we need to do it with care, and that is why I am going to take my time working through these recommendations - for the very reason that rash deregulation in this area can result in the sort of problems that occurred around leaky homes that ultimately cost New Zealand and New Zealand homeowners billions of dollars."
Smith said the Government was looking at a June 2014 Law Commission report recommending a cap for Council liability to be set initially at NZ$300,000 for a single dwelling; NZ$150,000 per unit in a multi-unit development, and NZ$3 million per multi-unit development.
"At the moment I am sitting on a report from the Law Commission that proposes to change the liability laws around building," Smith said.
"What they are saying is that is is unfair for the council to carry all of the liability," he said.
"If you are also looking to extend schedule one, which is the area where builders are exempt from getting building consent, there is the very real concern as to if it goes wrong who is going to fix it, and that is why I have got my officials working on a guarantee scheme which would effectively provide a backup in the event that the builder went broke or defunct, or there was faulty building work, that the homeowner would still be protected."
Compulsory scheme?
Smith pointed to a compulsory guarantee scheme used in Britain and a number of building guarantee companies in Australia, although he noted both Master Builders and Certified Builders also had schemes in New Zealand.
Asked if the guarantee scheme would increase building costs, he said that was the tradeoff involved.
"The question is whether we introduce some degree of regulation to require those, so if we are going to reduce the red tape we can also ensure the quality and we can ensure that, where there are building mistakes, things are fixed," Smith said.
"I am hopeful of being able to put out some specific proposals in both these areas by Christmas."
RMA progress?
Elsewhere, Prime Minister John Key said the Government's support partners had signalled they would support a fresh draft of a Resource Management Act reform bill through its first reading to the select committee stage.
"The Bill is pretty much complete as I understand it now, primarily because our support partners wanted to be able to read the Bill so they could actually see where they're going. I am fairly confident we've got the numbers to get it to a first reading," Key said.
"Whether we can get it out of the committee stage once we get it to that I don't know. We are in the very early stages, but it's making progress and my guess is it will be introduced relatively soon," he said.
Smith, who is in charge of RMA reforms, later said the Government was still in discussions with its support partners and he was still hopeful of tabling a bill before the end of the year.
(Updated with comments on RMA reform)
6 Comments
More expensive piffle from a government that specialises in it.
Remember that the implication at the start of this project was that councils imposed "loopy" and arbitrary rules on a long-suffering public. What they have come back with is a whole bunch of proposed changes to legislation imposed by government on a long-suffering local government sector.
It didn't require any of this hoopla. Reforming legislation that doesn't quite work is what governments are supposed to do as a matter of course.
BTW Stuff coverage suggests that one priority is reforming the Local Government Act 1974. Should be interesting. The 2002 Act repealed almost all the 1974 Act's provisions except for a couple of random roading provisions. (Of course Stuff might be wrong).
+1 to "more expensive piffle from a government that specialises in it."
We may as well give Smith and Key some fiddles so they can provide some entertainment while the housing crisis burns out of control.
The collateral damage to our economy and our egalitarian values is extreme and we get this sort of fake leadership today from Smith regarding doing what? to make building easier and Key stating out of control immigration doesn't impact on housing, infrastructure or employment is pathetic.
Why do we need a building code to enforce quality? Safety yes, but quality should be market driven like pretty much everything else we buy.
Want a quality home - well buy one that has a master builder's guarantee, or get a building inspection, or get some kind of insurance policy that covers poor workmanship.
Why add 10's of thousands of dollars in red tape to every build when regulation wasn't even able to prevent thousands of leaky buildings. Had it been buyer beware there may have been more checking done by purchasers and the leaky building problems may have been much less!
As for safety, get rid of the building act for residential homes of standard construction, its not needed. The CHCH earthquake proved this as no one was killed by a standard residential dwelling.
Agreed. Self-certification works for electrical, HVAC, plumbing and so on. Put single-storey, light roof, modest size residential builds under Schedule 1 BA 2004 and save squillions. Put the now unemployed inspectorate to work in the panelised construction production lines. Win, win.
The building code determines some level of quality in terms of minimum levels of durability of materials and finishes. If that was not in place we would be continuing on down the road of decaying buildings.
As for the comment that regulation couldn't stop leaky buildings - you are right - as (relaxed) regulations at the time allowed the incorporation of new systems and materials, designs and untreated timbers in perfect combination along with reduced council inspection oversight which resulted in the very problem of which you speak. The building act and building code were subsequently changed to minimise the risk of such issues occurring again.
And as for tens of thousands of dollars for regulatory red tape? Unless you have an incompetent designer your building consent for a standard house in NZ will cost between $2.5k & $5k. Anything else will be levies which go to the government, or resource consent related. And the council takes on the lion's share of liability if anything goes seriously wrong, as builders go bankrupt, cease trading or find some other out when it all turns to custard, but under joint and several liability the councils are usually last man standing and end up with the bill, as has done many times over throughout the country (hence councils pushing for law changes to cap their liability).
As for getting rid of the building act for residential buildings - unusual comment. I suggest you have a read of that document some time (At least up to section 75). You will find that it's all about ensuring that the owner gets what they paid for - a process designed to quality control building work and ensure compliance with the building code. And while you are at it have a read of the building code (the actual code, not the acceptable solutions) and you will then understand why nobody was killed in the Canterbury earthquakes in residential buildings (except by rockfall/cliff collapse from above).
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