Can we build bet­ter build­ings in NSW?

The con­struc­tion indus­try in New South Wales is in cri­sis and has been at an impasse for a pro­longed peri­od of time. The ques­tion as to why we have so many build­ing defects, par­tic­u­lar­ly in mul­ti-storey res­i­den­tial apart­ment build­ings, was being asked long before the Opal and Mas­cot tow­er dis­as­ters and the Lacrosse fire.

When did the cri­sis start? Was it the shift to a per­for­mance based nation­al con­struc­tion code in? Is it the result of the design and con­struct con­tract? Is it the fail­ure to con­tin­u­al­ly upgrade the Aus­tralian Stan­dards to ensure builders know how to build bet­ter build­ings? Is there a lack of train­ing, edu­ca­tion and super­vi­sion for the trades­men actu­al­ly doing the building?

What­ev­er the rea­son or rea­sons, which can­not rea­son­ably be pin-point­ed to one in par­tic­u­lar, David Chan­dler OAM, the NSW Build­ing Com­mis­sion­er strong­ly agrees that ​‘some­thing needs to be done with the industry’.

The NSW Gov­ern­ment has been at the fore­front of reform and remark­ably the most pro-active since the release of the Sher­gold Weir report in ear­ly 2018[1]. This seem­ing­ly need­ed to be the case giv­en NSW has the high­est rate of apart­ment liv­ing with­in Aus­tralia. The num­ber of peo­ple resid­ing in res­i­den­tial apart­ments in New South Wales has recent­ly been report­ed as being 1,123,464 peo­ple (15% of the pop­u­la­tion) as opposed to 8% of the pop­u­la­tion liv­ing in apart­ments in Vic­to­ria, 7% in Queens­land, 4% in West­ern Aus­tralian and South Aus­tralia, 3% in Tas­ma­nia with the ACT and North­ern Ter­ri­to­ry com­ing in sec­ond to NSW at 10%[2]. For three to four years from 2015, the devel­op­ment appli­ca­tions for ​‘attached dwellings’ was high­er than that for detached dwellings, although this has ​‘dipped’ more recently.

The Sher­gold Weir report includ­ed the authors’ obser­va­tions on the com­pli­ance and enforce­ment sys­tems for the build­ing and con­struc­tion indus­try and high­light­ed 24 rec­om­men­da­tions for a nation­al best prac­tice mod­el which will strength­en the effec­tive imple­men­ta­tion of the Nation­al Con­struc­tion Code. 

The NSW Gov­ern­ment spun the wheels for 12 months, which in the polit­i­cal are­na is rea­son­ably ​‘speedy’, before com­ing back with its response to the Sher­gold Weir rec­om­men­da­tions in ear­ly 2019.[3]

We have seen pos­i­tive action by the NSW Gov­ern­ment imple­ment­ing the major reforms iden­ti­fied in its ini­tial response, namely:

• Appoint a Build­ing Com­mis­sion­er – David Chan­dler OAM was appoint­ed to his posi­tion as the NSW Build­ing Com­mis­sion­er in August 2019 and is gear­ing up for 1 Sep­tem­ber 2020 with his recent­ly grant­ed pow­ers under the Res­i­den­tial Apart­ment Build­ings (Com­pli­ance and Enforce­ment Pow­ers) Act 2020[4] (RAB Act), pur­suant to which he will be able to stop occu­pa­tion cer­tifi­cates from being issued for res­i­den­tial apart­ment build­ings , make orders for devel­op­ers to rec­ti­fy defec­tive build­ings and issue stop work orders. The Build­ing Com­mis­sion­er cit­ing that there will be no ​’cut­ting cor­ners’ and that he is aim­ing to ​‘rid the indus­try of dan­ger­ous, builders and cer­ti­fiers…’[5].
• Over­haul com­pli­ance report­ing require build­ing prac­ti­tion­ers with report­ing oblig­a­tions to be reg­is­tered – recent­ly passed reform includes the RAB Act and the Design and Build­ing Prac­ti­tion­ers Act 2020[6] (D & BP Act) assent­ed to on 10 June 2020 with the major­i­ty of pro­vi­sions, relat­ing to design dec­la­ra­tions, reg­is­tra­tion of prac­ti­tion­ers with ade­quate insur­ance, etc to com­mence on 1 July 2021.
• Ensure that there is an indus­try-wide duty of care to home­own­ers – Part 4 of the D & BP Act com­menced from 10 June 2020 to intro­duce statu­to­ry duty of care pro­vi­sions allow­ing sub­se­quent title hold­ers in res­i­den­tial apart­ment build­ings, includ­ing own­ers cor­po­ra­tions, to bring a claim for eco­nom­ic loss aris­ing from the rec­ti­fi­ca­tion of defects aris­ing from con­struc­tion work against build­ing prac­ti­tion­ers, engi­neers, prod­uct sup­pli­ers and manufacturers.

Hav­ing pre­vi­ous­ly had doubt that we were mov­ing in the right direc­tion, I was qui­et­ly reas­sured in a recent meet­ing with the Build­ing Com­mis­sion­er, ​‘change’ is hap­pen­ing. Proac­tive steps are being imple­ment­ed. The ​‘six Pil­lars’ of reform are well and tru­ly estab­lished after intro­duc­tion in Feb­ru­ary 2020 and devel­op­ers, builders, cer­ti­fiers and oth­er con­struc­tion pro­fes­sion­als will be held account­able for their actions. Sys­tems are being put in place. Repeat offend­ers will not be able to hide with an advanced new dig­i­tal frame­work to be put into play to iden­ti­fy ​‘risky’ builders and devel­op­ers with their pro­files read­i­ly acces­si­ble with the high-risk cat­e­go­ry builders exclud­ed from pro­posed decen­ni­al lia­bil­i­ty insur­ance.[7]

Whilst I believe there are still many areas where reform and improve­ments are required in the NSW Con­struc­tion Indus­try, par­tic­u­lar­ly in the over­haul of the Aus­tralian Stan­dards to pro­vide detailed ​‘sys­tems’ that have been test­ed and found to actu­al­ly work, more strin­gent test­ing and data reg­is­ters for prod­ucts and, not to men­tion, greater and improved com­pre­hen­sive train­ing and edu­ca­tion includ­ing ongo­ing super­vi­sion of build­ing prac­ti­tion­ers so that the trades­men can learn and be shown how to build a bet­ter build­ing – there have been many steps in the right direc­tion over the past 12 months with what appears to be a ​‘man on a mis­sion’ at the helm of the team.

Let us see where 2020 and beyond takes the NSW con­struc­tion indus­try. Any step for­ward with­out two steps back is a pos­i­tive step!

[1] Build­ing Con­fi­dence – Improv­ing the effec­tive­ness of com­pli­ance and enforce­ment sys­tems for the build­ing and con­struc­tion indus­try across Aus­tralia pre­pared by Pro­fes­sor Peter Sher­gold and Ms Bron­wyn Weir https://www.industry.gov.au/sites/default/files/July%202018/document/pdf/building_ministers_forum_expert_assessment_-_building_confidence.pdf

[2] Aus­tralian Stra­ta Insights 2020 A report pre­pared by City Futures Research Cen­tre, UNSW Syd­ney, June 2020 file:///C:/Users/hek/Downloads/Australasian_Strata_Insights_2020_Final.pdf

[3] https://​www​.fair​trad​ing​.nsw​.gov​.au/​r​e​s​o​u​r​c​e​-​l​i​b​r​a​r​y​/​r​e​p​o​r​t​s​/​n​s​w​-​g​o​v​e​r​n​m​e​n​t​-​r​e​s​p​o​n​s​e​-​t​o​-​t​h​e​-​s​h​e​r​g​o​l​d​-​w​e​i​r​-​b​u​i​l​d​i​n​g​-​c​o​n​f​i​d​e​n​c​e​-​r​eport

[4] Res­i­den­tial Apart­ment Build­ings (Com­pli­ance and Enforce­ment Pow­ers) Act 2020 https://​www​.leg​is​la​tion​.nsw​.gov​.au/​#​/​v​i​e​w​/​a​c​t​/​2​0​2​0​/​9​/​p​a​r​t​5​/div1

[5] Refer rel­e­vant linked arti­cle at:…/ https://​dri​ve​.google​.com/​f​i​l​e​/​d​/​1​p​g​p​S​x​x​w​J​8​0​t​V​w​Z​u​k​b​C​U​8​W​7​s​n​f​_​5​s​H​X​G​9​/​v​i​e​w​?​u​s​p​=​s​h​aring

[6] Design and Build­ing Prac­ti­tion­ers Act 2020 https://​www​.leg​is​la​tion​.nsw​.gov​.au/​#​/​v​i​e​w​/​a​c​t​/​2​020/7

[7] Build­ing Con­fi­dence NSW Reshap­ing the cus­tomer val­ue propo­si­tion Mov­ing from ​‘Cri­sis to Safe to go back in the mar­ket’ July 2020