Recently, the Hon Chris Penk (Minister of Building and Construction) announced the Government's two-pronged approach to streamline the building consent and inspection process. These initiatives are the opt-in self-certification scheme, and the introduction of mandatory inspection timeframes for Building Consent Authorities (BCAs). The schemes are designed to free up BCAs to focus on high-risk, complex builds, and reduce development delays for simple residential builds.
What are the current building consent requirements?
BCAs ensure that building work is being carried out in accordance with building consents. A fundamental aspect of this process is determining that the building work complies with the building regulations and code. Presently, for work done by builders, plumbers and drainlayers, building inspections must be conducted by an authorised officer of a BCA, usually a council; this can be done on-site or through a remote inspection via livestream or digital photos. BCAs are facing high workloads leading to extended wait times for building consent and inspections. This causes disruptions to project timelines in the industry.
New self-certification scheme for builders and plumbers
The first new policy is the opt-in self-certification scheme, implemented by amendments to the Building Act 2004 and the Plumbers, Gasfitters and Drainlayers Act 2006. The scheme would empower eligible building firms, plumbers and drainlayers to sign off their own work, removing the need for inspections by BCAs. The scheme is meant to put these building professionals on equal footing with registered electricians and gasfitters, who have had the flexibility to self-certify for years.
Two opt in self-certification schemes have been proposed:
- A scheme for house builders carrying out building work, including design and construction, on an entire simple residential dwelling; and
- A scheme for plumbers and drainlayers carrying out work on a simple residential dwelling.
The parameters of an eligible simple residential dwelling will be set out in regulation following industry consultation. The government has proposed that only building professionals who meet strict criteria will qualify for the scheme. The scheme is designed to streamline the construction of 3,000 simple residential builds, which will have the knock-on effect of freeing up BCAs to focus on high-risk, complex builds. Under the scheme, BCAs will still be required to provide a nominal consent for entire simple homes where trusted building professionals are self-certifying their work. Legislation to enable the self-certification scheme will be introduced by the end of 2025.
Mandatory timeframes for BCA building inspections
The second new policy will require BCAs to complete 80% of building inspections within three working days. BCAs will implement updated strategies to boost efficiency and prioritise workload to reduce building and construction delays. To encourage greater public transparency and performance accountability, the success of BCAs meeting targets will be shown in quarterly performance data. Inspection targets will come into force later this year.
Industry impacts and legal considerations
The new self-certification scheme incentivises better quality work from building professionals as they shoulder more of the risk. Conversely, this will mean that BCAs carry less liability. This will have a host of impacts concerning liability for building defects.
It will be interesting to see how the government chooses to regulate new self-certifiers, and implement accountability measures, whether it be random checks on self-certified works, or imposing a strong penalty system. It is not uncommon for BCAs to be the only solvent party in construction litigation, which means that they are forced to cover settlement or damages. Shifting this responsibility away from BCAs may have an impact on consumers' ability to be remedied for non-compliant work.
Insurers will be affected by the greater responsibility taken on by self-certifiers (who will require insurance against this increased risk – affecting premiums) and naturally there will be an increase in claims against building practitioners.
While BCAs may see some relief in their workload as a result of the self-certification scheme, imposing mandatory inspection timeframes places greater pressure on an already stretched system.
For this to be a successful policy initiative it will be crucial that the government regulates the risk involved in shifting liabilities for building defects and effectively manages inspection targets for BCAs.
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