The Building Legislation Amendment (Consumer Protection) Bill 2015 tabled in Parliament in December 2015 should set alarm bells ringing throughout the Victorian community.

The bill is a smokescreen devised to mask the deception of nil ‘consumer protection’ and the pretence has been formulated to feign legitimacy for revoking consumers’ human rights. Disguised as ‘lawful,’ this decree is a veritable wolf in sheep’s clothing!

If this bill were a genuine attempt at improving safeguards for building consumers, logically it would have addressed the problems repeatedly identified as causing consumer harm. The ‘solutions’ are self- evident, preventative measures the key: clean up the industry, introduce sound governance and give consumers a chance to compete in a fair market. However, this bill continues the old anti-consumer policy, with the ‘old’ classic features remaining totally intact and the ‘old’ VBA and CAV in charge.

An examination of the legislation reveals its negative focus on disputation.

Dispute history

Let us begin by considering the path to the current consumer catastrophe, including the colossal number of building disputes, the massive financial loss to consumers and the exponential increase over time. In 2002, there were 35,000 building disputes according to a media release by the building commissioner – hardly insignificant. But in 2002, CAV began its ‘conciliation’ service, supposedly to ensure dispute reduction.

However, as the statistics indicate, CAV was an extraordinary failure if its objective was as stated. From 35,000 disputes in 2002, this rose to 206,000 in 2008 and to 256,000 by 2011 – or 38 per cent of all Victorian building consumers!

In terms of consumers’ financial loss, it was $500 million in 2005, rising to $706 million in 2006, escalating to $1.6 billion in 2008 and reaching an estimated $3 billion in 2011. If we consider building consumers’ financial loss as a percentage of total consumer detriment, it was 22 per cent of total consumer detriment in 2006, 53 per cent by 2008 and not disclosed in 2011, according to the CAV Consumer market Experience Study of 2006, 2008 and 2011.

The irrational rationale

Under Victorian law, every new bill put to Parliament must be compatible with the Victorian Charter of Human Rights, “checked against the Charter,” and “telling Parliament how it relates to human rights.” It can only be incompatible with the Charter “in exceptional circumstances,” and a statement explaining how/why human rights came to be ignored is compulsory. Minister Wynne’s Statement of Compatibility declared this legislation as incompatible, his reasoning being that violation of human rights was a necessary precondition for ‘protecting’ consumers. Thus, regardless of their wishes, the ‘protective’ path for consumers is forced disputation and human rights nullification.

First, Wynne acknowledged the breach of an owners’ right to access a court or tribunal, requiring owners to “refer the dispute to the dispute resolution service” before being “entitled to commence proceedings in VCAT or a court.” He rationalized that “no less restrictive alternative is reasonably available” and “it is my view the right is a reasonable limit.” This is his justification for incompatibility with the Charter.

This new body will have extraordinary legally binding powers to forcibly extract money from owners to give to builders – this under CAV, which has an abominable record on dispute resolution and protecting consumers.

Second, Wynne argued it reasonable to violate a consumer’s right to a fair hearing by making dispute resolution compulsory for consumers, stating: “it is my view the right is a reasonable limit.” In his statement defending the bill’s compatibility, Wynne argued that the ‘old’ dispute resolution process “has a 90 per cent resolution rate but its voluntary nature… limits its effectiveness.” If we accept this figure and Wynne’s reasoning, such a successful outcome on a voluntary basis would negate any argument for mandatory disputes!

The horrendous dispute statistics above make it clear that this ridiculous 90 per cent claim is untrue. Almost 40 per cent of consumers suffered enormous financial detriment via ‘disputes’ in 2011, yet Wynne quoted a 90 per cent resolution rate.

On this point, CAV’s definition of ‘resolved’ is insightful; according to the Consumer Confidence and market Experience Study 2010-2011, “The term ‘resolved’ is used to mean that the consumer and the trader or supplier had reached an agreement about the consumer’s problem.”

According to this, ‘resolve’ does not mean ‘finding a resolution!’ This fallacious storytelling renders the 90 per cent claim ridiculous. Also telling is the victim blaming, with disputes being seen as the “consumer’s problem” and the irrational supposition that since consumers are the problem, they must be ‘regulated’ into disputes and punished.

Further calling into question CAV’s performance is this staggering statistic from the CAV Consumer Experience’ Report of 2008: “44% of problems with home building were unresolved.”

But there’s more! In 2013, the Auditor General found CAV had falsified the ‘consumer satisfaction’ statistics in its annual reports. And, despite 256,000 building consumers suffering financial loss in 2011, CAV concluded its 2011 Report on Consumer Experience: “This study shows that the Victorian market environment is working effectively.”

This CAV will continue to ‘control’ disputes and damage consumers. Obviously, CAV’s credibility as Wynne’s basis for mandating disputes and breaching human rights is discredited.

How can CAV and the VBA, with their blighted history on the public record ‘dictate’ the dispute arrangements? Consider the craziest of claims, Wynne’s assurance that the VBA will use “suitably qualified conciliators and technical assessors capable of examining domestic building work.”

This is not so! Under new section 48(1), an assessor can be:

  • an architect registered under the Architects Act 1991
  • a building practitioner registered under the Building Act in a prescribed category or class
  • a person in a prescribed class of persons.

According to this, assessors can be any building practitioner – say a demolisher! Or it could be any ‘person’ without any building qualifications or expertise! All have powers to inspect buildings, write reports nominating a building as defect free and to invoke orders compelling owners to pay money to builders who have no entitlement to payment!

This is not just illogical, but illegal. Section 176 of the Building Act stipulates that only registered building inspectors can legally inspect buildings. Unregistered imposters do not qualify. But Wynne’s way, breaching the Building Act, removes any impediment to ‘protecting’ the cowboys!

Third, the Charter protects a person’s right not to have his or her privacy unlawfully or arbitrarily interfered with. Wynne explained his willingness to contravene the Charter by saying “In my view, while the exercise of the entry power may interfere with the privacy of an individual in some cases, any such interference will not be arbitrary” and adding that “Any resulting interference with privacy will occur lawfully under these provisions.”

In layman’s language, Wynne’s overreach of his position and powers has him deem the unlawful contravention of the Charter and rescinding our human right to privacy as lawful, demonstrating his contempt for consumers and the law.

Fourth, under the Charter, a person’s right not to be deprived of their property other than in accordance with law is protected.

“It is unlikely in my view that any exercise of this power will result in any real deprivation of property,” Wynne reasons, adding that “should it result in any deprivation of property, I am satisfied it would occur in accordance with law.”

As above, Wynne has rationalized deprivation of our right to property as lawful by his decree and thus justified the unlawful breach of the Charter of Human Rights!

In conclusion, it is not surprising that this bill defies rationality. How could one possibly justify breaching the Charter of Human Rights and violating consumers’ inalienable rights to ‘protect’ them?