The sad state of the Victorian building industry

The latest media release by the Independent Broad-based Anti-corruption Commission (IBAC) (see; A further 28 people charged as part of IBAC's Operation Perseus | IBAC) is just another step in the slow decline in the Victorian Building industry over the past 20 years. ?

Whilst the majority of builders and building practitioners are qualified, competent, and produce good quality buildings for consumers, the increasing number of rogue operators (and failure to address their poor practice, see https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_safety-building-buildingsurveying-activity-6900249494835863552-cesW?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU) and increasing regulatory burden on good operators (who take compliance seriously) is undermining the ability of those good practitioners to remain in the building industry, and undermining the hope, enthusiasm and confidence of young entrants into the industry.

For example, I met a young construction manager on site late last year and he told me his business partner was applying for registration as a limited commercial builder for office fit-outs and non-structural work. He was offered an 'upgrade' to an unlimited commercial builder for an extra fee of $10,000, but wisely declined. ?He was upset and disappointed that the offer was even made as he had worked hard to study and achieve the requisite qualifications and experience to apply. ?How can we establish pride, competence and quality in the building industry when new entrants are seeing poor practice, collusion and corruption from within the office of the regulator of the building industry? ?And it is worth restating that this is the second time this has been uncovered; the Victorian Building Authority (VBA) was created because the former Building Commission was investigated by the Ombudsman's office in 2012 for almost exactly the same matter (https://www.austlii.edu.au/cgi-bin/viewdoc/au/other/VicOmbPRp/2012/12.html?context=1;query=Victorian%20Ombudsman%20Brilliant%20Building;mask_path=).

It appears to me that the greater problem now is how many building practitioners have been registered inappropriately in Victora since 2012 (or before), and how can consumers know which ones they are?

There are also many other factors that have lead us to this point in history and I have reported on so many of these that I can’t list them all, but here are some key topics that I believe still need to be addressed;

1. Adequate research (and funding) for new and innovative materials to support the building industry https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_learning-from-history-activity-6602438868954304512-gV78?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU

A relevant example is rendered EPS cladding on dwellings, one of the most common cladding systems on double storey housing in Victoria (and used to satisfy high energy efficiency ratings in the building regulations), but as there is still no relevant Australian Standard for installation, nor any trained installers or even an agreed definition of what 'render' is, it is not surprising that compliance is so poor.

2. Efficient and effective education, training and oversight https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_buildingsurveying-buildingconstruction-firesafetyengineering-activity-6596971614657630208-keUA?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU

3. A policy culture that understands the lessons of the past and of overseas experience https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_cladding-goodgovernance-construction-activity-6549779047616913408-Wu5W?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU

4. A policy culture that understands the solutions of overseas experience https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_the-curious-case-of-combustible-cladding-activity-6217833296898981888-6orm?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU

5. A better system of oversight, inspection and accountability https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_building-buildingsurveyor-architecture-activity-7003262313575194624-D6im?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU.

6. Clarity around conflicts of interest between designers, builders and building surveyors/inspectors (https://www.dhirubhai.net/posts/stephen-kip-oam-b6a3098_education-buildingsurveying-buildingconstruction-activity-6597365971504160768-p5_7?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAF4J0IBkYcJL6PIoC_YduBIHjCes10zfBU).

It seems to me we need a detailed review of the increasing poor culture and practices in the industry, and the parallel increasingly heavy burden of new regulation, that impacts on the good practitioners but can be ignored by poor practitioners if there is no adequate oversight, inspection and accountability.?

An example is the current focus on housing supply in Australia that has put housing affordability at the forefront of public discussion.?

Reserve Bank Assistant Governor Sarah Hunter stated in her presentation in May 2024 (Housing Market Cycles and Fundamentals) that (my bold added); “some market participants have delayed projects or decided not to begin because of the relatively high cost of building when compared with the project’s returns”, and “over the long run, it is the fundamentals of demand and the structural build cost that ultimately dictate supply – monetary policy does not have an impact on either of these underlying drivers”.?

However the current National Construction Code of Australia 2022 edition requires each new house to achieve; wheelchair accessibility to and within the ground floor, a 7-star energy rating, condensation management measures, bushfire protection measures (if in a bushfire prone area) and many other challenging and expensive construction issues.? These world-leading and well-intentioned ‘best practice’ provisions seem almost incompatible with affordable housing, but we aren’t having a public debate about whether we have over-regulated the design and construction of houses beyond the existing levels of competence in the industry, and above the ability of many consumers to afford them.? And that doesn’t include the significant re-design, retraining and additional audit and inspection pressures and costs that these well-intentioned measures put on good designers, builders and approval authorities. ???

The policy tensions between; increasing standards of habitation in our planning schemes and national building code, the crisis of housing supply, the shortage of skilled practitioners, and the lack of support for existing good practitioners (who will try their best to incorporate all these new provisions into their projects but inevitably lose out to poor operators who are not getting re-educated or?held to account) needs to be debated and either reinforced or reset and reformed.?

As the Rolling Stones said; “you can’t always get what you want, but if you try sometimes you just might find you get what you need”.

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