Victoria Building System Failing Consumers: BCRA 1

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Monday, December 1st, 2014
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A key advocacy group in Victoria has hit out at the state’s building system, saying the current system does not afford adequate levels of protection and that recent attempts at reform have failed to address fundamental consumer concerns.

Claiming that around 256,000 consumers of the domestic building industry within the state suffer from poor construction practices (based on the most recent figures available from the Department of Justice), the Building Compliance Reform Association (BCRA) held protests outside the offices of the Victorian Building Authority (VBA) earlier this month calling for a fundamental overhaul of regulation within the sector.

BCRA president Anne Paten said the aim of the protests – which followed a public meeting in October attended by several hundred people – revolved around raising awareness about what she says is the plight of consumers under the current system and making reform of the system an election issue.

“I think the thing that we are aiming for is to get the public to actually know what is going on,” Paten said. “They have not been told any of the reality that there is basically no consumer protection if you attempt to build or renovate or repair or maintain a home.”

Throughout Victoria, the process of building industry regulation and compliance came under fire several years ago as both the state’s Auditor General and the Ombudsman issued separate damning reports into practices in areas such as the issuing of building permits and the builder registration process. The Ombudsman’s report in particular alleged widespread conflicts of interest within what was then the Victorian Building Commission.

In response, the government replaced both the Building Commission and the Plumbing Industry Commission with the VBA, although further moves to overhaul the Builders Warranty Insurance Scheme and consolidate the work of a number of regulatory bodies into three bodies are currently on hold pending the election.

Paten says sweeping changes are needed, including involvement of people from outside the building industry and outside the state in inquiries or tribunal hearings, the introduction of ‘genuine’ consumer representatives (those with a consumer background) on regulatory bodies and boards, replacement of the ‘last resort’ insurance scheme with a ‘first resort’ arrangement and the creation of a new industry Ombudsman to hold regulatory bodies accountable.

She says the flow-on effects of poor building practices upon consumers include not just loss of income but marriage and relationship breakdowns and even major health effects such as heart attacks, strokes and suicide attempts.

Though insisting that the vast majority of builders are competent and act in good faith, government ministers acknowledge the system has room for improvement.

In May, Finance Minister Robert Clark admitted the current system was failing and that it can be ‘far too difficult’ for consumers to get justice when builders do the wrong thing.

Still, industry representatives insist current levels of protection are adequate.

Paten made earlier claims of a myriad of problems including lax builder registration processes and enforcement of regulatory compliance, dispute resolution processes which favour builders over consumers and insufficient accountability on the part of regulatory bodies, among others. In response, Housing Industry Association (Victoria) regional executive director Gil King said assessment practices for registration applications often go beyond those specified in regulations and that in many cases, penalties imposed on builders could be considered to be heavy rather than too light.

King says far from being under regulated, the industry is overburdened with excessive regulation and red-tape, an impost he says adds substantially to the cost of housing.

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  1. Anne Paten

    All I can say is that the HIA is in Fairyland. But of course he is not a fairy, nor is in in any 'Fairyland'. Sadly he knows only too well that he is in 'Spinland' and not 'Fairyland' and what he is spinning about 'regulation', let alone being overburdened with 'excessive regulation' is more than a furphy, more than incredulous and it is pure, unadulterated NONSENSE As for red-tape, as attached to bureaucracy, it is an OXY-MORON – no regulation, no red-tape, and no COMPLIANCE or ENFORCEMENT for 22 years! What a coup! What a cunning con! What a capitalist contrivance!

    Very sad.