An arrangement designed to ease costs by aligning technical standards between New Zealand and Australia is fracturing due to high costs

A partial fix could become available for a failing aspect of trans-Tasman economic relations:  compatible technical standards.    

But according to trade groups, it is not on its own sufficient to fix a problem that is costly for contractors and could even carry risks for the public.

The issue stems from the fact that everyday items such as toasters, radios or shavers, as well as tools like drills or saws, must be manufactured to recognised standards. The same rule applies to materials such as pipes, wires or steel beams. In most cases, the standards and their certifying numbers can be found in small print on the back of a piece of equipment. 

It has long been recognised that Australia and New Zealand should basically share the same standards, because the two countries trade with each other, invest in each other and even tender for each other’s contracts. To formalise this, the Trans-Tasman Mutual Recognition Arrangement (TTMRA) came into effect in 1997. 

For years, it worked well, setting common rules for both countries, with special carveouts for Australia’s vulnerability to bushfires and New Zealand’s vulnerability to earthquakes. 

But the system started to fracture in 2016 and this process has continued unabated, according to Master Electricians New Zealand.

“Standards Australia acts as the secretariat for many (joint standards) and requires a participation fee to cover the costs,” says Master Electricians chief executive Alexandra Vranyac-Wheeler in an opinion piece (see below).

“Participation fees range from $7,000 to $80,000 per standard, and became more burdensome when Standards New Zealand was absorbed in 2016 into the Ministry of Business, Innovation and Employment (MBIE) without updating the funding model,” she says. 

“The outcome is that over 500 joint Australia-NZ standards have been de-jointed since 2016, and more are being de-jointed each month.”

One dramatic de-jointed standard, AS/NZS 2293, relates to emergency lighting, so that people can get out of a building safely in the event of a disaster.    

“We have noted that among the listed standards proposed for re-jointing, the AS/NZS 2293 series, is critically important and should be treated as a high priority.  These standards play a vital role in ensuring the safety and efficiency of emergency lighting systems in buildings,” Vranyac-Wheeler says. 

Explaining this problem further, a Master Electricians official says the dis-connect between New Zealand and Australia does not mean that current lighting systems are dangerous.  But it does man that access to new technology that makes them safer could be impeded, or made only useable in New Zealand at an even higher cost than usual. 

Master Plumbers New Zealand share the concerns of Master Electricians. The organisation’s chief executive Greg Wallace says a standard comes up for registration or renewal every month or so, and the cost can be unaffordable. 

He says unless that money is found, under the system’s 100% cost-recovery model, then New Zealand can be stuck with an Australia-only standard.   

“When you make a product or you’re doing an installation, you want that to be relevant for your own market, otherwise you have to look at international standards or otherwise, or you can recognize the Australia-only standard. But it can be missing key components that should be part of the construction process," Wallace says.  

“I’ll give you an example. During the Canterbury earthquakes, we found a lot of the issues happened between the home and the connection with the water pipes or the sewer or storm water drains in the street."

"So, what we did is, we changed the standards to say that you should have a flexible joint between those two points to allow for movement. Now, if you don’t have those kinds of things embedded (in the standards), then you don’t get good building resilience.”  

The Heavy Engineering Research Association (HERA) is also worried about this problem.

“HERA already contributes substantial in-kind work to establishing national structural steel-related standards,” says its chief executive Troy Coyle.

“But then we get charged money to commission the standards, and when they are published, we get charged again to use them.”

It is understood some engineering companies are left even more out of pocket than electricians, being up for as much as $100,000 per standard.  And some standards are years out of date.  In one case cited by the plumbers, a piece of copper tubing has a standard dating from 1978.

The Registered Master Builders Federation declined to comment on this issue.

However, the concerns of various trade bodies have been taken up by Business New Zealand, and have been debated by staff at MBIE and with their Australian counterparts.  

According to Master Electricians, a solution of sorts is being worked on. The idea is to use money from the Building Levy to pay for new standards. The Building Levy is charged to builders or developers at a rate of $1.75 for every $1000 of consented building work. It is used to pay for information, guidance, compliance, enforcement and monitoring of the building industry. 

The Building Levy currently has an estimated value of $54 million, after peaking at $71.5 million in 2023. 

According to the Master Electricians, some of this money will be redirected to fixing the fractured TTMRA.  And the choice of which standard will be dealt with first will depend on how critical it is. 

MBIE is saying little about this, except that some building levy funds already get used for this work in some cases.

“There are some occasions where joint standards for New Zealand and Australia meet the purposes laid out in the Building Act for use of levy funds,” the Ministry says.

It cites work for drainage, wind resistance and composite steel and concrete construction as examples. 

Further work on this matter is understood to be in train. 

Meanwhile, there is an extra problem. The Government recently raised the threshold for payments into the Building Levy, meaning cheaper building projects will not contribute to the fund.  This fact, along with more bills arriving on its desk for setting standards, could diminish the amount of money available for work on standards in the long run.  

But the process is still being welcomed by Master Electricians, with reservations. 

“Addressing the immediate issues with de-jointed standards while working towards a more sustainable funding model for Standards New Zealand is a prudent approach,” Vranyac-Wheeler says.

“But we have flagged concerns around the standards that are not included in this funding process.   

"As indicated, only standards related to building, construction, and health and safety will be covered. We are currently seeking a definitive list of standards that will and will not be included, so that industry can be kept fully up to speed and we can find further funding solutions that will enable re-jointing wherever this is the most desirable outcome.”

*The following is an article by Alexandra Vranyac-Wheeler, CEO of Master Electricians NZ.

Why joint standards are a win for the electrical sector and consumers , and what we need to do to achieve them

Many industries in New Zealand and Australia have long worked with and relied upon joint standards – referred to as AS/NZS standards – to ensure consistency, safety, and efficiency.

These standards, developed collaboratively, are crucial for regulatory compliance, facilitating smooth trade, and ensuring product safety.

How de-jointing has happened 

Though joint standards have been a bedrock of New Zealand’s electrical industry, among others, a significant challenge has been brewing for years: the steady de-jointing of these standards due to funding issues. Unlike other standards bodies globally, Standards New Zealand operates on a 100% user-pays model, without direct government funding.

Standards Australia acts as the secretariat for many AS/NZS standards and requires a participation fee to cover the costs of coordinating joint standards development, as does Standards New Zealand for the joint standards for which it acts as secretariat.

Participation fees range from $7,000 to $80,000 per standard and became more burdensome when Standards New Zealand was absorbed in 2016 into the Ministry of Business, Innovation and Employment but without updating the funding model. The outcome is that over 500 joint Australia-NZ standards have been de-jointed since 2016, and more are being de-jointed each month.

Energy Safety (WorkSafe) has contributed funding in line with its own regulatory interests, however, this is not the secure, future-proofed approach the New Zealand economy and commercial sector needs. The issue is compounded by the larger problem of regulations being years out of date, which affects the confidence various stakeholders feel in making long-term financial commitments – but standards will inevitably be updated at some point, and there needs to be a suitable replacement ready.

Why it matters

Joint standards are essential to maintain economic, regulatory, and practical alignment between Australia and New Zealand. They ensure that products, processes, and services comply with both countries' regulations, facilitating smoother trade and reducing compliance costs for businesses operating trans-Tasman. They are vital for public safety and confidence and quality assurance because they ensure that electrical products and installations meet rigorous safety criteria.

The de-jointing of standards poses significant risks across sectors, including the electrical industry. Without joint standards, companies face increased complexity, potential trade barriers, and higher costs due to the need to meet different regulatory requirements. De-jointing may compromise safety and increase the risk of substandard products entering the market, and we have no control or influence over content of international standards and cannot make sure they are fit for the New Zealand context.

The larger issue for New Zealand is that if we do not come up with the funding for fees we will not be included in development, and affected standards will become Australian IP and an Australian-only standard. Once a standard is de-jointed our only options are to adopt the AS standard or another international standard or develop our own unique NZS standards. The latter costs a lot of money and time and doesn’t guarantee continued compatibility with AS or other international standards – so may be detrimental to our international trade relationships while failing to solve the real problem. It is easier and more logical, in the informed view of industry, to focus on solving directly the core problem of de-jointing.

Securing a solution

In response to this critical issue, a raft of industry groups including Master Electricians, and spearheaded by Business New Zealand, lobbied the Government to find a sustainable solution.

As of mid-June the Government has advised industry stakeholders that it is progressing work to ensure greater regulatory alignment with overseas jurisdictions to help facilitate trade and improve competition in New Zealand. It is seeking to harmonise or adopt regulatory approaches from other jurisdictions, with an initial focus on Australia. Meanwhile, MBIE is progressing a package of legislative changes to make it easier to use building products and systems that are approved in comparable overseas jurisdictions.

Our collective advocacy has to date elicited a positive response, with several key initiatives emerging from the Australia NZ Regulatory Coherence Forum on 4 June:

 The Government has committed to using the Building Levy to support joint standards development. This levy had accumulated significant funds and will now be partially redirected to cover the participation fees required by Standards Australia, ensuring that the de-jointing of standards is halted and important standards can be re-jointed.

 The Government will focus on re-jointing standards that are deemed critical. This process involves both funding and collaboration with Standards Australia to reintegrate these standards into the joint framework, preserving their New Zealand- specific conditions and maintaining international alignment.

 The Forum included key stakeholders from Australia and New Zealand and aims to foster continuous dialogue to resolve regulatory differences, improve regulatory coherence, and support the Australia-NZ Single Economic Market.

 Future efforts will include auditing existing standards to identify further issues, educating businesses about mutual recognition agreements, and creating mechanisms to maintain alignment.

What happens now

While this funding commitment marks a substantial win, the journey continues to achieve complete resolution. Ongoing dialogues between industry groups, MBIE, and Australian counterparts must address remaining barriers and ensure long-term alignment. Efforts such as auditing existing procedures, raising awareness about the Trans-Tasman Mutual Recognition Agreement (TTMRA), and adopting more international standards are pivotal advancements.

Master Electricians is in close dialogue with MBIE as the voice and advocate for the electrical industry, and we are offering our active participation in the standards processes to contribute technical input and support re-jointing efforts for the electrical industry. We have noted that among the listed standards proposed for re-jointing, the AS/NZS 2293 series is critically important and should be treated as a high priority. These standards play a vital role in ensuring the safety and efficiency of emergency lighting systems in buildings.

Addressing the immediate issues with de-jointed standards while working towards a more sustainable funding model for Standards New Zealand is a prudent approach. The proposed measures will help prevent future de-jointing and ensure that New Zealand can continue to adopt and maintain relevant standards in a timely manner.

We have also flagged concerns around the standards that are not included in this funding process . As indicated, only standards related to building, construction, and health and safety will be covered. We are currently seeking a definitive list of standards that will and will not be included so that industry can be kept fully up to speed and we can find further funding solutions that will enable re-jointing wherever this is the most desirable outcome.

This successful outcome represents a triumph of the collective effort and persistent advocacy of various industry groups, the leadership of Business New Zealand, and the industry bodies that collaborated to find solutions.

By securing the necessary funding and commitment from the Government for the first stage of re-jointing, the electrical industry and other sectors can look forward to a more stable and cooperative future. This achievement underscores the power of collective action and serves as a reminder of the importance of maintaining strong, unified standards for the benefit of all.