Tasmanian Building Regulatory Framework Review Decision Regulatory Impact Statement

Transcription

1 Tasmanian Building Regulatory Framework Review Decision Regulatory Impact Statement September 2015

2 2 1 Background The Building and Construction Industry makes a significant contribution to Tasmania s economy. In 2014 the Construction Industry represented 6.3 per cent of the State s output and 7.6 per cent of its employment. 1 The current Building Regulatory Framework was introduced in 2004 following over 20 years of consultation and development beginning with the Development Review Working Group (1983) and the Model Building Act developed nationally in 1991 by the Australian Uniform Building Regulations Coordinating Council. The Building Act 2000 introduced significant reforms including: accreditation of all responsible Building Practitioners (designers, builders and building surveyors) with a requirement for mandatory insurance and continuing professional development; private certification of building compliance, with permits issued by council Permit Authorities; liability reforms and specified duties for all participants; the binding of the Crown; maintenance of essential safety and health features in buildings; and establishment of a Director of Building Control, a Building Regulation Advisory Committee and continuation of the Building Appeal Board. These reforms addressed a number of significant issues with the previous regulation of the industry, but ten years on, it was appropriate to review whether these reforms were working as intended. The Building Framework includes a number of Acts which relate to the building and construction industry in Tasmania. Although the Building Act 2000 is the primary Act being reviewed, the new framework also impacts on the following Acts and Regulations: Building Regulations 2014 and the Plumbing Regulations 2014; Housing Indemnity Act 1992; Occupational Licensing Act 2005; Architects Act 1929; Building and Construction Industry Security of Payments Act 2009; Resource Management and Planning Appeals Tribunal Act 1993; and Fire Service Act The Review provided an opportunity to consult with all those affected by the industry to find out what was working well, and what needed further consideration. See Attachment A for a statement of consultations. Major areas of concern related to over-regulation of low-risk work, the length of time taken to get building approval, and a lack of competition in the areas of building surveying and issuing of building permits, due to the public/private model currently in place in the State. Lack of affordable dispute resolution services for consumers was also a concern. To address these issues, a number of changes have been proposed. 1 data/assets/pdf_file/0011/89579/building_construction.pdf

3 3 By allowing builder certification for certain low risk buildings and excluding some low risk work from certification processes, consumers will see reduced time and costs to complete small projects. By reducing the need for plumbing permits and increasing risk-based auditing of plumbing work, consumers will see a reduction in the time taken to get building approval and also reduced costs for the permit process. By reducing the time and cost of the permit process, there is expected to be an increase in work undertaken. Clarification of the role and code of conduct for building surveyors will ensure that practitioners are carrying out the duties of the role as intended. Introduction of improved dispute resolution will ensure that disputes are resolved as early as possible to avoid escalation resulting in increased costs and damage to the reputation of practitioners and the industry. While the proposed changes to the Tasmanian Building Regulatory Framework are expected to have a positive impact on the building industry, the Secretary of Treasury has determined that some aspects could potentially impose a significant burden on parts of the business community and therefore these aspects required the preparation of a decision regulatory impact statement (RIS). Specifically, the proposed increased costs on practitioners (plumbers, electricians, surveyors and other occupations) due to the requirement for mandatory continuing professional development and the increased administrative burdens from the introduction of additional reporting requirements for building surveyors. This RIS has been prepared by the Consumer, Building and Occupational Services (CBOS) division of the and is based on the information collated as part of the review. 2 Potential impacts on business 2.1 Ensuring practitioners (plumbers, electricians, surveyors and other occupations) maintain their skills level Audit and inspection results, together with defect and complaint histories, show that some areas of the building industry are not working to the required standard. There is a significant cost to practitioners in rectification work due to unsatisfactory workmanship or non-compliance with standards. There is also a significant impact on the reputation of the industry by cowboy operators, and a cost to owners due to delays or non-functioning installations. All licensed trades (including electricians and plumbers) are encouraged to continue to develop their skills through ongoing professional development. However, it is not a condition of having their licence renewed, as it is with builders, designers and architects. The Administrator of Occupational Licensing already has the authority to introduce CPD for occupations covered by the Occupational Licensing Act However, this requirement has not previously been activated. The Administrator of Occupational Licensing will now activate mandatory CPD, through a Directive, so that building practitioners will have this requirement as part of their licensing conditions. It is envisaged that practitioners will require 12 points CPD per year (equivalent to 12 hours). For nominated managers (supervisors), 20 points CPD will be required. This is same as for builders. The content of the CPD will be approved by the Administrator of Occupational Licensing or Director Building Control. Under this proposal, the benefits are: increases the skill level of the industry; increases the safety qualities of buildings;

4 4 increases compliance with national standards; increases awareness of changes in the standards; all occupations treated equally; and provides a sanction where skills are not up to standard. The costs of the proposal are: the administrative burden on practitioners to attend training; and a potential barrier to entry. The anticipated 12 hours of CPD per year for practitioners can be accrued through a number of low-cost or free activities, including reading trade publications, newsletters from CBOS, and attending training sessions and presentations. It is anticipated that there will only be a nominal cost for attending sessions provided by CBOS, and where possible, these will be run in a number of regions to reduce travel time and cost. However any costs incurred would be tax deductible. CPD sessions will usually be held outside work hours to reduce the impact of foregone earnings. Alternative options Other options flagged during the consultation process were auditing and reaccreditation at regular intervals. Stakeholder feedback During the consultation process, there was broad support for the proposal to mandate CPD including the support of the Master Plumbers Association Tasmania and National Electrical and Communications Association. These associations are working with the Administrator of Occupational Licensing to provide meaningful CPD opportunities for licensees. Evaluation and conclusion The building industry and practices within it are undergoing change at a greater rate than before. This makes it essential for practitioners within the industry to stay up to date with changes, new technologies and new approaches. The cost of CPD to practitioners is expected to be low with CBOS partnering with industry associations and training providers to develop online and face-to-face training opportunities that address perceived problem areas in the industry. Information will also be provided to all practitioners regarding changes to national and Tasmanian standards and emerging technologies and regular bi-monthly newsletters from CBOS will also provide information that will be of use to practitioners in ensuring their skills stay up to date. It is planned that the requirement for CPD for these trades will be introduced over a three year period with a monitor and advise brief before any compliance action is taken. This approach was used successfully when CPD was introduced for building practitioners. Accordingly, it is considered that the benefits of the proposal outweigh the costs. 2.2 Introduction of reporting requirements for building surveyors One of the issues with measuring the performance of the building industry is the lack of information available. The information required to be reported by building surveyors to CBOS will be on the classification of building work, the value of the contracts and start and completion of work. All of this is currently gathered by building surveyors but none is collated.

5 5 The collection of information regarding the value of contracts allows oversight of whether building surveyors are performing the required level of service. For example, if a building surveyor is charging significantly less than the average fee, it is likely that they are not making site visits or carrying out an appropriate number of inspections. This allows for quality control of the industry as well as providing information about the number and size of projects being undertaken. Failure to meet reporting requirements will be taken into account when building surveyors apply for licence renewal. The benefits of the proposal include: it provides information about the industry in terms of the type of building projects being undertaken; and CBOS will be better placed to provide support to the industry by being better aware of trends. The cost of the proposal is that building surveyors will need to record and report information. However, the cost to building surveyors is expected to be negligible and will only impact on those not currently keeping appropriate records of their files. Stakeholder feedback While there is broad support for the proposal, there is some concern that this requirement will duplicate the reports that building surveyors already submit to Permit Authorities. Where possible, the reported information will be consistent to avoid duplication. Evaluation and conclusion Increased reporting requirements need to be balanced against making onerous demands on practitioners, but baseline information about building projects is something that practitioners should be providing anyway. It allows CBOS to shift the emphasis from regulatory compliance to informed, risk-based targeted auditing. In the first instance, the reporting requirements will be a simple process with a quarterly return (a spreadsheet that can be filled in with each approval around 2-3 minutes work per file). There will be no expensive software required or prescribed format. However, CBOS will continue to work on developing an online building approvals platform so that this task will become automated and will be no additional work. It is therefore considered that the benefits of the proposal outweigh the costs. 3. Summary The Building Regulatory Framework was introduced to help ensure all building works in Tasmania conform to national standards in terms of safety, amenity and quality. However, some of the existing regulation does not meet the test of necessity, benefit and ease of use. In line with a key election commitment of the State Government to reduce unnecessary red tape, the aim of the Tasmanian Building Regulatory Framework Review is to ensure that we have sufficient regulation to deliver the objectives without placing an unnecessary regulatory burden on people wishing to undertake building works. The proposed legislative changes will deliver a system that reduces the regulatory burden on consumers and practitioners without compromising the safety of our built environment. While the requirement for mandatory continuing professional development and the introduction of additional reporting requirements for building surveyors may impose some level of costs on parts of the building industry, these costs are expected to be outweighed by the benefits that the changes will bring.

6 6 Attachment A: Statement of consultation process At the commencement of the formal stakeholder consultation process, key industry bodies were identified which would have a particular interest in the Review. These included: Master Builders Tasmania Housing Industry Association Master Plumbers Association of Tasmania Australian Institute of Building Surveyors The General Manager CBOS has met with representatives of these bodies both formally and informally throughout the consultation process. This included: At least five workshops with industry bodies Presentations at industry events including trade nights, forums and professional development sessions Presentations to industry executive boards Presentations at public forums Frequent individual meetings Other key stakeholders included local government representatives from Council building and planning areas. The General Manager CBOS has met with some Permit Authority staff and General Managers who have been generous with their time and provided feedback and a platform for testing concepts as they were developed through the Review. Meetings with selected Local Government representatives have included: At least five workshops Individual meetings During the first phase of the Review, an examination of the current framework was carried out to identify the perceived issues that needed addressing. This was initiated by asking staff to identify areas of concern including those resulting in the most frequent enquiries. In order to gain a broad range of opinions on these issues, four reference groups were formed: Building Industry group comprising members of building industry associations Consumer group comprising individuals with concerns regarding the regulatory process and bodies representing consumers Local Government group comprising representatives of Permit Authorities Technical group comprising practitioners from the building industry These groups each met twice to assist in the development of an Issues Paper. The Building Regulation Advisory Committee (BRAC) also met twice to identify issues with the current framework. This Paper was then made available to the broader public and submissions invited. The 53 submissions received were then used to develop a Position Paper which contained a number of recommendations and options. The Reference Groups and BRAC were again invited to provide feedback on the Paper prior to it being released for a further period of public consultation, which

7 7 included the opportunity to nominate preferred options as well as indicate the level of support for the recommendations. At the conclusion of the second public consultation process, a preferred position was developed, based on the 60 public submissions received and expert opinion, in the context of the stated objectives of the proposed legislation and the commitment of the current government to reduce the regulatory burden on practitioners and home owners undertaking building works. This resulted in the development of a legislative package containing the following elements: an Amendment Bill for the Occupational Licensing Act 2005 defining requirements for licensing, codes of conduct, rectification and professional development and including Building Practitioner Licensing, previously in the Building Act 2000 an Amendment Bill for the Building and Construction Industry Security of Payments Act 2009 providing greater consumer protection and arbitration options a new Residential Building Work Contracts and Dispute Resolution Bill providing better protection for consumers through improved contracts and simpler, more accessible dispute resolution processes a new Building Bill 2016 defining the process of building approvals, the roles of practitioners and the roles of the regulatory bodies All Reference Groups and BRAC were once again convened for a presentation which provided an update on the recommendations being implemented. The result of this ongoing consultation is that all stakeholders are aware of the changes being proposed, have been part of a transparent process in developing these, and have endorsed the outcomes. It is anticipated that stakeholder reference groups will also be invited to provide feedback on resources during the implementation phase.

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