Victoria and NSW move to strengthen building quality

The most recent collapse of the home building company left over 2,500 building contracts in the lurch, with supply chain delays and labour shortages two of the primary factors blamed for the collapse. Late last month, news broke that over 500 families had discovered their deposits had been lost due to the company’s failure to take out insurance on their behalf, which spurred the Victorian government to provide a one-off relief scheme to the affected consumers.

The Victorian state government has now announced reforms to the Domestic Building Contracts Act 1995 and strengthened domestic building insurance requirements, providing Victorian building regulators more powers to monitor whether builders are meeting their obligations under the law to take out domestic building insurance prior to receiving a deposit.

Additionally, it has said it will introduce tough new penalties for any operators failing to comply with these requirements.

The Victorian Building Authority (VBA) — to be headed up by new chief executive Anna Cronin — will audit builders regarding the collection of deposits and purchase of domestic building insurance.

Victorian Minister for Planning, Sonya Kilkenny, outlined the reforms are “ensuring Victorians can have faith in the construction firms who build their homes, protecting their hard-earned savings.”

Over the last 12 months, the Australian construction industry has felt the brunt of significant global economic headwinds, including rising supply chain costs. Due to this, and born from consultation with the sector, the Victorian government will also consider providing an extended transition for some new National Construction Code requirements that are currently scheduled to commence in October.

Opportunities to review the role of all regulators and improve the information provided to consumers about a builder’s obligation to take out domestic building insurance have also been floated as part of the reforms package.

These initiatives will form part of the ongoing building reform program currently underway to reshape the Victorian building system, with State Premier Dan Andrews revealing “these reforms are part of a comprehensive review to modernise Victoria’s building system, delivering better protection for Victorians building a home, while providing clarity to the building industry.”

The introduction of any further reforms will reportedly be staged to allow strong consultation with the building industry.

NSW announces new Building Commission

Over in NSW, the Minns Labor Government has said it will strengthen the quality of building and construction in NSW by establishing a NSW Building Commission by the end of the year.

The new body will oversee the regulation, licensing, and oversight of the industry.

It will continue the work started by Building Commissioner David Chandler, who was appointed in 2019.

The NSW Building Commission will work to ensure that “people who purchase any property in NSW can have even greater confidence in the quality of the work”.

The government will also this year introduce to Parliament a new Building Act, written in plain English, that will “consolidate and modernise many pieces of legislation, some decades old, scattered throughout the state’s statute books”.

The NSW state government outlined it hoped the new moves would provide clarity to consumers and the sector about their rights and responsibilities and incentivise the building sector to deliver quality homes.

NSW Premier Chris Minns said: “I’ve made clear we need more supply, there’s no two ways about it.

“The pressure on the rental market is severe, and the government’s job is to get more supply into the system to help alleviate some of that pressure. But I want to provide confidence to the public that when we build, we’ll build properly.

“We want well-built, well-designed suburbs with top-tier buildings and top-tier builders.

“The Building Commissioner David Chandler has done a remarkable job cleaning up the construction industry. We want to expand on that and ensure [we] can get supply moving while still maintaining public confidence in the quality.”

NSW’s Minister for Building, Anoulack Chanthivong, added: “We have the chance to deliver on a once-in-a-generation opportunity to transform the NSW construction sector.

“We’re thrilled to be joined by David Chandler OAM who has been responsible for bipartisan reforms to strengthen and modernise our construction sector.

“This sector accounts for almost 10 per cent of the economy, so getting this right is critical.

“We have to build up not out and this is the first step in ensuring the projects in this global city are of the highest quality.”

[Related: Victorian government compensates Porter Davis collapse victims]