Australia: Residential Focus - 11 October 2017: Part 1 - NCBPs in Australian construction industry

Last Updated: 15 October 2017
Article by Eleanor Grounds
Most Read Contributor in Australia, August 2018

In June 2015, in the wake of the Lacrosse tower fire in Melbourne in November 2014, the Australian Senate referred an inquiry into the effects of non-conforming building products (NCBPs) on the Australian building and construction industry to the Senate Economics References Committee (Committee).

What are non-conforming building products?

The Australian Building Codes Board (ABCB) determines NCBPs to be building products and materials that:

  • claim to be something they're not;
  • do not meet the required standards for their intended use; or
  • are marketed or supplied with the intent to deceive those who use them.

NCBPs differ from non-compliant products (NCPs), which are products or materials used in situations where they do not comply with the National Construction Code (NCC). For example, a building product labelled as non-combustible when it actually is combustible would be a NCBP. On the other hand, a building product that is correctly described as combustible but is used in a situation where the NCC requires a non-combustible product would be a NCP.

Update on the report

The Committee was due to hand down its report on NCBPs by October 2015. This has since been extended seven times. Additionally, in October 2016 the Committee resolved to update the terms of reference to deliver a separate interim report on the illegal importation of products containing asbestos. The receipt of this report has been extended twice.

In response to the Grenfell Tower fire in London in June 2017, where approximately 80 people died (the final death toll is not yet known), the Committee also agreed to prepare an additional interim report on the effects of non-compliant external cladding materials as a priority.

The current final reporting dates are:

  • 6 September 2017: Interim report on external cladding materials was received
  • 31 October 2017: Interim report on the illegal importation of products containing asbestos due
  • 30 April 2018: Final inquiry report due

Interim report handed down on 6 September 2017

The interim report on external cladding material was handed down on 6 September 2017, which outlined the following eight recommendations to manage the risks posed by aluminium composite cladding:

  1. The Commonwealth government implement a total ban on the importation, sale and use of polyethylene core aluminium composite panels as a matter of urgency.
  2. The establishment of a national licensing scheme through cooperation among the Commonwealth and state and territory governments. The scheme would have requirements for continued professional development for all building practitioners.
  3. The Building Minister's Forum are to introduce nationally consistent measures to increase accountability for participants across the supply chain.
  4. The Federal Government consider making all Australian standards and codes freely available.
  5. The imposition of penalties for non-compliance with the NCC such as revocation of accreditation or bans from tendering for Commonwealth-funded construction work and substantial financial penalties.
  6. Increased resources for the Federal Safety Commissioner to ensure the office is able to carry out its duties in line with the new audit function and projected work flow.
  7. Support for the Commonwealth government to give further consideration to Director Identification Numbers and a recommendation to expedite this process in order to prevent directors engaging in illegal phoenix activity.
  8. The establishment of a nationally consistent statutory duty of care protection for end users in the residential strata sector.

Industry response

Unsurprisingly, a number of key stakeholders, including industry organisations, have criticised the Federal Government's inaction on the issue and decision to consistently delay the delivery of the reports.

The Building Products Innovation Council (BPIC), the peak body representing Australia's building product associations, described "the lack of government action" as "unconscionable". The BPIC also condemned the cladding audit announced in response to the Grenfell fire. "There has already been a cladding audit done in Victoria in the wake of the Lacrosse fire, and the NSW Department of Planning and Environment conducted their own internal audit and estimated that 1,800 buildings (and possibly as many as 2,500) in metropolitan Sydney could contain flammable cladding material. Calling for more audits is only going to tell us what we already know," the BCIP said in a statement in June.

The Fire Protection Association of Australia (FPA) has also criticised the recommendation in the September interim report on external cladding materials to ban aluminium composite cladding in all Australian buildings. "The use of combustible cladding on high-rise buildings is already banned under the NCC," the FPA said in a statement. "We just need people to adhere to that code. It comes down to people not complying to Australia's building codes and standards. Banning the product twice is unnecessary."

The Commonwealth government rejected the recommendation for a full ban on the import, sale and use of aluminium composite cladding due to the fact it can be legally used in some circumstances. The Construction Forestry Mining and Energy Union (CFMEU) has condemned this rejection, saying the government is "inexplicably digging in its heels and refusing to act".

"There is no question that this product is putting lives at risks or that it continues to be used on high-rise building projects," CFMEU Construction national secretary Dave Noonan said. "Not only have they failed to act, they are actively fighting against a ban that will almost certainly save lives."

Current status of the report

Submissions to the Committee closed on 18 January 2017. With any luck, the final inquiry report will be delivered on time in April 2018. No proposed New South Wales or Commonwealth legislation addressing the issue has been seen at this stage. Queensland legislation to regulate the use of NCBPs was assented to on 31 August 2017. The final report is long overdue, which is a real concern as NCBPs have serious health and safety consequences and, unfortunately, have made their way into the construction industry supply chain in Australia.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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Eleanor Grounds
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