Six Ways to Fix Private Certification in Australia 34

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Friday, July 19th, 2013
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In 25 years as a barrister in construction, I have seen considerable growth in terms of private certification, and have observed not only the impact of litigation in this area but also a number of problems in the system, including some certifiers being too close to their clients and others not demonstrating sufficient levels of respect for their role in terms of compliance regulation.

The situation in Victoria, whereby two scathing reports from the Auditor General and the Ombudsman with regard to the building control system led to the demise of the Building Commission, underscores just how serious problems in this area can be.

Whilst lawyers are good at criticising, our profession must go beyond this and put forward constructive suggestions.

Accordingly, here are six ways I would change the system.

1. A floor on surveyor fees

Whilst the role of building surveyors is integral to public safety, the pressure they face as private operators competing for work has led to cases of quotes which are unrealistically low to the extent they do not allow the practitioner in question to adequately discharge their duty of care whilst still earning a sufficient level of financial reward for their effort.

This has been happening for years. Back in 2001, for example, when presiding over a case involving a 16-year-old who became a quadriplegic after falling from a non-compliant balustrade in 1996, Victorian Supreme Court Justice Eames J observed the amount charged by the building inspector was woefully inadequate given the magnitude of the task.

More than a decade later, this is still happening, with unrealistically low fees inevitably leading to shortcuts and compromised work. Only a minimum floor price which certifiers are allowed to accept for their services will stop this.

2. Mandatory audits

In the legal profession, we have to be audited three times per year, regardless of whether or not there are any complaints against us.

This is not the case with private certifiers, who are not required by law in Australia to undergo any form of periodic tests with regard to either their capacity to carry out their work in a satisfactory manner or their performance in doing so.

This should not be the case. The work of surveyors affects public safety. Failure to perform duties adequately can cause serious injury or loss of life.

The Japanese have a mandatory auditing regime in place. We should too.

3. Mandatory CPD

A building surveyor is a professional and, as such, must ensure they keep up to date with new developments and that their skills and practices meet best-practice requirements.

New South Wales inserted a requirement into the law when they introduced private certification in the 1990s which required certifiers to undertake two days of refresher training each year, which involves ‘tooling up’ on the Environmental Planning and Assessment Act and the Building Code of Australia (BCA).

This is sensible policy. Other states should follow suit and mandate ongoing professional development requirements.

4. Subject alternative solutions to peer review

In my view, this is probably the single biggest threat to the integrity of the building process in Australia today – private certifiers issuing permits for alternative solutions where aspects of the design do not comply with the BCA or Australian standards, a situation which places excessive responsibility on one person and introduces too much vulnerability to coercion or expedience.

Alternative solutions should not be sanctioned without peer review. Legislation should immediately be enacted to prevent this from happening.

5. More oversight power

The most robust and comprehensive powers regarding practitioner oversight in Australia can be seen in New South Wales, where there is even recognition under the ICAC legislation that accredited certifiers are public officers and fall within the ICAC jurisdiction.

I commend this regime, which serves as a template other states should follow.

6. Grade certifiers

Again, New South Wales serves as the national benchmark, where a grading system regulates the level of work a certifier can perform according to their level of experience.

As with the above point about oversight power, this is a sensible system which other states should follow.

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34
  1. Stephen Williams

    Good article. I agree with the point on mandatory CPD. It’s a great way to stay on top of emerging issues in your profession as well as maintaining and improving skills and knowledge.

  2. David Millar

    Item 1 – Agreed and further, fees should be paid up front at the application stage much the same as would be expected if a planning (DA application) was made to Local Government. Item 2 – the ACT Territory Government audits 10% of all certifiers building approvals practising in their jurisdiction (albeit focussed on administrative function) and the Queensland Government conducts random audits on certifiers under the QBSA Act capturing 90% of certifiers over a two year period. Item 3 – National AIBS requires all accredited members to achieve 90 mandatory points over a triennium period not so Victoria or NSW. Item 4- Agreed without comment. Item 5- No comment. Item 6- Grading systems are also in place in Qld, ACT and now Victoria. A national building certification model promoting public interest should be at the heart of the industry and the primary focus of certifier’s
    decisions. Selecting and appointing a building surveyor must be the sole interest and duty of the building/land owner. For this to happen consumer law must enforce practicable outcomes to ensure building owners are not duped or coerced into agreement by appointing a developer or builders ‘preferred certifier’ by way of incentives.

    • KimLovegrove

      Great feedback David, good to see that you are on the same page, it would be great if you could share the article and get others to chime in with comment.

  3. Ari Akritidis

    Well written. It’s not often I agree with someone on these issues but you’re right on the money with your comments.

    The system can be fixed, it just needs courage and foresight from Government. Some of us have been trying to get this message across for years!

  4. Scott McGufficke

    As a NSW private certifier Items 2,3,5 and 6 are fairly well covered while Item 4 is currently on the table as part of NSW Planning Reforms being introduced in the near future. This leaves Item 1 as the stand out feature for NSW to address and decision makers must not fail to consider competitve neutrality for local councils who choose to compete with the private sector for certification services. By far the largest share of the certification market is held by local government but they are not held by any competitive neutrality principles and can ‘prop up’ poorly performing certification services with funds from consolidated revenue as well as being subject to a range of GST and other tax exemptions not available to their private competitors Council certifiers are also subject to different fees and rules for accreditation and re-accreditation that save their employers thousands of dollars annually compared to the private sector. Council certifiers are also exempt from having to pay any fines or costs for compensation under the Building Professionals Act and Regulations while the Board investigates more complaints from councils about private certifiers than from any other source. There are hundreds more council certifiers than private and only the foolhardy would believe that they are not making the same mistakes as their private counterparts, the only difference being one of accountability and transparency in the conduct of their business. In rural areas it is not uncommon for the council certifier to issue a DA and subsequent CC or issue a CDC, then conduct all of the inspections, deal with any and all complaints about the development and then issue an occupation certificate. If some issue arose relating to professional misconduct or unsatisfactory professional conduct – who would ever know? The same certifier however, can gleefully send off complaints to the BPB on any private competitor who is forced to submit all thier documentation to council for archiving.

    • Steve Cleaver

      In Western Australia there are several State agencies that can investigate Local Government certifiers too. I recall a large resort development that the Architect amended a plan to include a second story function centre on a resort administration building without certification ie no disability access or fire egress. The certifier downgraded the function area from a class 9 to a class 5 board room to get it through. No doubt he had a commercial incentive as he was getting paid by the architect.

      This has left my Local Government to read the riot act to every new strata manager who tries to use this room as a function centre. I don't know how that certifier sleeps at night!

  5. Prof Kim Lovegrove

    Great insights gentlemen, how to we get the word out there? Are you guys able to share and circulate the six poin plan?

  6. Graeme Hunt

    I guess you could say this message is getting out there. This is a very clear and concise program for reform and national uniformity. Since the development of the Model Building Legislation and National Competition Policy we have now essentially 10 or more years experience operating in a new mixed private/public environment. It would be true to say that when our current systems were developed they were based on a high expectation of professionalism, but in hindsight the commercial reality of private certification was not predicted.

    Whilst Tasmania already includes some of the proposals in its legislative requirements – audits (not mandatory), mandatory CPD and a grading system – current indications are that even these areas will suffer future administrative resource constraints. There seems to be little appetite for minimum fees even though there is evidence of “the race to the bottom”. Peer review is a controversial topic with some building surveyors seemingly requiring all engineering design to be peer reviewed and others in favour of “self certification”.

    Tasmanian legislation makes no distinction between public and private building surveyors. Recognition that private building surveyors are public officers would in my view assist the profession by building it’s profile to a level where appropriate fees could be charged and a professional job done in all cases.

    • Gabriel Barnes

      I work in the Tasmanian System and have been a vocal critic of the Act; to Graeme's annoyance on occasions!……. We have Building Surveyors being accredited with little or no formal qualifications, others through RPL who were Engineers, Architects and the like. Many with little or no professional practice, supervision practice training as a Building Surveyor under another Building Surveyor. Bring back the cadetship!…. What's wrong with this?…. Engineers and Architects are consultants put them into the role of the BS and they continue to act like consultants…. Building Surveyors are statutory public officers undertaking an independent third party certification and review of design and construction….. We are NOT consultants!

  7. Professor Kim Lovegrove

    Great to hear from you after all these years Graeme and you are right on the money. Graeme and I were there right at the beginning ie prior to the ABCB at the then AUBRCC when Lyall Dix was chair. Graeme is right when he says that it was envisaged that there would be more professionalism and he is also right when he is skeptical about the appetite for a fee floor. Yet the sad fact is in my view and I`ve been beating this drum for a bloody long time, absent a fee floor, the industry will continue to be compromised. The cut price fees phenomena is deadly to building control.

  8. Peter Glodic

    Stephen (and Kim),

    I personally, and on behalf of Omnii applaud your proposal. When I read then re-read the 6 point plan, it seemed so fundamental and a no-brainer. Perhaps tied in with point 4 is to remove the recalcitrant Building Surveyor from providing design advice, or simply accepting alternate solutions devoid of an independently appointed Fire Safety Engineer. The six point plan should also extend to perhaps other design professionals, however crawl before you walk as they say. And I have a vested interest in the latter I will disclose, but again, for the good of the industry

  9. Mark Anderson

    I concur with your six points and believe that its about time that AIBS and RICS joined together to ensure consistency across states and provide mandatory CPD events/ comments on the BCA changes.

  10. Gerrit Duits

    Could not agree more

    • MC Hui

      Stephen and Kim,

      I agree with the six points but would like to add the following:

      1. Apply the first four points to Fire Safety Engineers as well.
      2. Review the current registration of FSE in Victoria in accordance with Engineers Australia NPER criteria.

  11. Pedro Jay

    Certifiers should not be allowed to work directly for builders or developers. The should only be engaged by the building owner to perform work.
    They fear if they are too tough they will lose work from the builder /developer. I always thought they were supposed to represent the Building owners not the builder.
    The floor on Certifiers fees is a good idea and should also apply to Building Designers.

  12. KimLovegrove

    Great insights from some industry luminaries, let's keep the conversation going guys becuase nobody else seems to and if you could share the link and get some momentum happenning. For our part we will continue to reblog and encourage debate.

  13. Peter Micevski

    Insightful article. I certainly agree with you that there is a correlation between the decline in professional standards amongst building surveyors with the decline in surveyor's fees.

  14. Jarrod Gutsa

    Some great points by all. This topic is on the agenda again with the recent release of the Auditor General Report in the ACT certification sphere.

  15. Ron Goddard

    Well said Stephen, I could not agree more. I would like to see the fee schedule of those posting any comments… just to keep it honest

  16. Peter McDonald

    As a building surveyor who has worked for both Council and private business I can tell you that I never felt so much pressure to keep clients (builders) happy than with private business. The constant fear of losing clients if we make them jump through "too many hoops" i.e. simply getting them to conform with the minimum requirements of the BCA. One option that would help is to have owners engage certifiers for certification work. A floor on fees would help a little, but not as much as everyone thinks. The QBCC audit 90 percent of certifiers but they only audit 1-2% of the approvals. We did 3000 approvals in a year a few years back and only 5 files were audited. The issue with the industry as a whole is quality, relevant education.

    • Brett Bates

      Much of what has been suggested and commented upon is reasonable but in some respects the cart may be being positioned before the horse. Wherever mandatory builder licencing exists there is already a very strong imperative for quality compliance without a 'third wheel' in the process. This is as a throwback to a time when any idiot could call themselves 'builder'. The issue that needs pursuing more than checking for compliance is that of National licencing of builders. It was an objective to get uniform licencing with relevant grades of licence matched to related qualifications. It all became too hard as our tightly held colonial based prejudices and fear of losing control (take the WH&S proposals for example) blocking the way forward.

  17. Trevor Kempster

    Hello,

    With regards to item 4. above! I'm assuming that you are not talking about an alternate solution with regards to Fire Protection? I thought that only a Fire Engineer could do this ie a Class 10 fire engineer for NSW etc. Surely this is not something that a Certifier carry's out? I did not realise that they were qualified for this? please clarify Regards Trevor

  18. Greg Johnston

    The comments relate not just to private certification but certification generally. Having seen the work of some building surveyors / certifiers pre & post working for a a private organisation I have seen the standards they enforce drop. It is an unfortunate outcome of competition in a regulatory environment the lowest common denominator effect. Only owners should be able to appoint certifiers.

    Any auditing system must be based on outcomes re: work including site visits as the current practices addressing administrative issues only, do not improve the outcomes of the actual building work. There are many instances of basic building practices that are not done – (eg) brickwork flashings.

  19. Paul Eltringham

    As a qualified and active building surveyor in Qld and Victoria with 20 yrs experience i offer the following comments –
    1 – I don't think fees have anything to do with it
    2 – I agree that we should be audited at least once a year to stop the cowboys
    3 – Qld also has mandatory CPD. It's been discussed in Vic for years but still not in for some reason.
    4 – Peer review is the main issue as there certainly is pressure from the client. However, fire brigade approval is required in most cases before it can be approved so this is effectively a peer review. This occurs in all states. I understand the fees to assess and approve alternate solutions is very low in Vic from what i have seen though compared to the fire engineers fees. We should be charging the same as the fire engineer to reliaise with fire engineer/fire brigade, write summary report and accept the risk involved.
    5 – No comment
    6 – Certifiers are already graded in most states. Better networking is essential between certifiers since it is very difficult to be up to date with the BCA and other legislative requirements for all types of buildings even if fully qualified to do so.

  20. Samuel Perna

    Kim, I agree with your points. Not sure about point 5. It is not all about fixing the certifier though! We have and are still experiencing an onslaught of litigation where we are being blamed for various issues that do not directy involve us. We need change to legislation so our roles and responsibilities are clearly defined. Whilst I recognise the defficiencies in private certification, there are also defficiencies within our building acts and industry which us certifiers are being blamed for. We are not a bunch of recalcitrant certifiers, we are a young profession who are generally doing the best they can under the circumstances well as trying to educate their clients. It is extremely difficult to police an uneducated building industry to comply with building regs that they either dont understand or are trying to get away with. We have speed cameras and TV campaigns to assist the police with road tolls. We are given no assistance to enforce building regs. We need help with educating the Designers and builders. We need to have more support from AIBS, ie funded, compulsory training, proper legal representation, as well as pressure on architects and designers.

    • Brett Bates

      Agree with concept of training builders (and national licensing system) better for particular grades of construction work. This would make the work of the certifier much easier rather than having to act as the 'compliance cops' with a whole lot of shoddy builders doing shoddy work through ignorance or wilfully. Think of medical practice. Is it better to try to prevent the disease or to treat it? If we had more stringent training and licencing of builders we could reduce the amount of inferior and non-compliant works that are performed. And lets face it. I don't care how diligent a certifier is. They miss a helluva lot of mistakes and short cuts as they cannot be on-site 24/7.

  21. John Prendergast

    Hi Stephen

    You know my position on the system in Victoria and its needs a fair bit of tweaking to make it sustainable. Whilst there are some things that can be done around professionalism and conduct the main issue is that the building must be made responsible for building inferior products.

    That's is both inferior & imported materials and quality of workmanship. These items are constantly causing an issue and the Building Surveyor is taking the blame.

    Another issues is that the Government is intent on bringing in more consumer protection laws but not fixing the cause of the problem. Yes the consumer is getting an inferior product but its not the Building Code or regulations its the builder in most cases.

    What also concerns me about the comment son this topic is that the majority are from interstate and only a few Victorians. We have to stand up rattle cages and make positive change happen.

    To do this we must unite all groups, AIBS, VMBSG, HIA, MBA & the Legal fraternity and insist on change. Victoria was the go to state for building control in Australia in the 80's & 90's and now I believe we are third world governance in this area.

    Harsh & grumpy

  22. Branko Mladichek

    Great article from Stephen
    I especially agree with comments about 4. Alternative Solutions.
    Alternative solution is meant to cater for creativity outside prescribed system but in my experience it has been used wrongfully to try to justify defective building (prescriptive) work.
    Use of alternative solution after building approval should be banned and yes introduce peer review and certification ( similar to form 14 for structural engineering certification).

  23. Ian Anlezark

    Great article Stephen, however you have missed the "sleeper" that will bring the Certification industry to a grinding halt.
    I predict that if the current trend continues it will be impossible for Building Certifiers to obtain Professional Indemnity insurance.
    Insurers are gun shy due to the fact that Certifiers are always joined in any civil action which then leads to higher premiums and as I predict the future inability to obtain insurance or obtain insurance at a reasonable rate.
    The recent fire in Melbourne will have far reaching consequences in the area of Insurance.

  24. Matt Campbell

    This article is spot on Stephen. Although the recently enacted Building Legislation Amendment (Consumer Protection) Act 2016 addresses some issues regarding Building Surveyors, it would be wise for the legislators to incorporate some of (or all) Stephen's recommendations.

  25. James O'Donnell

    Point number 1 of Stephen Smith's is of particular interest as when any profession starts to compete on price rather than skill, more often than not, corners are cut and the end product being of a lesser standards. Furthermore, updating and maintaining those skills is an important facet to the building and constructions industry and with the Building Legislation Amendment (Consumer Protection) Act 2016, builders will be required to undertake CPD points as part of their registration.

  26. Kim lovegrove

    Stephen Smith's treatise on how to fix private certification is a 'cure all' all of the answers are there. Nothing more to BD said.

  27. Emily Martins

    A very informative and concise article Stephen. I wholeheartedly agree with you that alternative solutions should not be sanctioned without peer review. The frightening level of discretion that is visited upon the the private certifier in this regard to rely upon his or her independent judgement to get it right without peer review can create a situation of grave risk.

  28. Trevor Beardsmore

    Great article.Mandatory CPD is a must as is grading of certifiers. The most critical aspect of private certification is enforcement and the regulators must take firm action on non performing certifiers including loss of licence when appropriate otherwise it can not work.