Building Legislation Amendment Bill 2021
(Second Reading Speech, 8 June 2021, Legislative Assembly, NSW Parliament)
As the member representing the electorate with the largest proportion of apartments, I know all too well the damage and suffering that owners and residents experience from building defects.
I have heard from many constituents who bought homes in newly constructed buildings only to find themselves having to deal with faulty membranes that cause damp and mould; non-compliant fire systems that put residents in danger and become the subject of complex and expensive fire safety orders; and inadequate foundations that cause buildings to crack.
Apartment owners in buildings with defects have been understandably angry about the erosion of protections in recent decades, including the introduction of private certification and reduced statutory warranty periods. To fix defective work, many have had to pay massive levies on top of their big mortgages. Where court action was possible, many owners paid expensive legal fees only to lose on technicalities and, in some cases, pay the developer's costs—all to address defects that were not their responsibility and that they could not have foreseen. People invest their life savings in buying a home. The devastation that defects can have on their finances and wellbeing cannot be understated.
In the past two years we have made substantial leaps forward in consumer protection against apartment defects. I congratulate the Minister on his part in making the issue a priority. We now have a comprehensive accreditation system for all building practitioners and strong duty‑of‑care provisions. Most importantly, we have a dedicated and active Building Commissioner, who is working hard to improve apartment building quality. The Building Legislation Amendment Bill 2021 will help strengthen the new regime that was introduced to improve building standards. The oversight role of the NSW Building Commissioner is the cornerstone of that regime. Much of the work is hands on, requiring audits, inspections and work with developers and building practitioners to fix problems.
The bill will ensure a sustainable funding model for this important work by means of a levy on developers. The levy, which is unlikely to amount to more than $100 per lot, will have no impact on the prices of units—which are set by market value anyway. Unfortunately, developers are still trying to use loopholes to avoid their obligations and duties, and to frustrate the Building Commissioner's work. Their efforts only demonstrate how important a strong regulatory framework is to protecting homebuyers. Currently, a prohibition order against issuing an occupation certificate or registering a strata plan is only permitted when defects have been found. As a result, some developers are refusing to provide documents, information, records or even answer questions to make it impossible to identify defects.
The bill enables the Building Commissioner to issue orders when a developer fails to comply with a request for information regardless of whether defects have been found. The penalties for failing to comply with directions or notifications will be continuing and will accumulate as the failure to comply continues. Since the bill was introduced a new loophole has come to light whereby developers are arguing that the Building Commissioner has no power to issue orders in cases where work has been done illegally, such as without a construction certificate. That sounds ludicrous, but it is happening. I will move an amendment to close the loophole. The Better Regulation Legislation Amendment (Miscellaneous) Bill 2021, which also amends legislation in the Minister's portfolio, gives the Building Commissioner power to order a bond from a developer when defects are found. That will provide an important safeguard to ensure that defects get fixed.
Other changes in the Building Legislation Amendment Bill 2021 facilitate the co‑regulatory model for registering engineers, consistent with the recommendations of the inquiry conducted by the Legislative Assembly Committee on Environment and Planning, which I chaired. We will only raise building standards through continuous improvement. I congratulate the Minister on introducing new measures to strengthen the current framework. Building Commissioner David Chandler has brought much-needed confidence in the future of building standards, which will benefit the Government, the sector and consumers alike. We must remain vigilant and address any new loopholes or problems that arise. We must keep working with consumer groups like the Owners Corporation Network to ensure that we reverse the proliferation of building defects and have a world‑class apartment‑building industry. I commend the bill to the House.
Full debate HERE