Building Connection Spring 2018

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for the claim could be left without
compensation. This would not
happen should regulators maintain a
requirement for comprehensive cover.
A further consequence of allowing
registration with incomplete cover is
that before long, there would not be
any practitioners with appropriate
insurance to deal with remediation of
existing cladding risks.
The most appropriate response
of governments and regulators is
to establish a funding model that
provides assistance where cladding
risk mitigation is required. There is a
range of funding models that could be
used for this and it would be up to the
government of the day to establish
the most appropriate of these for the
jurisdiction involved.
The UK government has just
announced a 200-million-pound fund
to be used for remediation of cladding
risks.
Governments are reticent to provision
of funds because they wish to maintain
a façade of innocence in respect to the
advent of combustible cladding and
non-conforming building products on
buildings.
If governments think they might
not be exposed to claim if they don’t
admit that the regulatory systems and
technical requirements were in part
to blame for this situation, they have
another thing coming. The failure of
the professional indemnity insurance
market for the building industry will
leave the government as the only
player capable of dealing with existing
cladding mitigation because owners
will largely not be able to cover it
themselves. Instead of taking a share
of the responsibility, governments will
have most of it and take a far more
significant reputational hit in the
process.
The best thing for the federal
government to do would be to
investigate opportunities for the
establishment of a funding model
supporting state and territory
governments to mitigate cladding risk
with existing buildings.
State and Territory governments
need to review their auditing schemes
to ensure they are capable of detecting
poor practice and non-conforming or
non-compliant product and material
supply and use.
The enforcement systems need to
be strengthened to ensure that where
adverse audit findings occur, non-
complying work or non-conforming
products and materials can be dealt
with, quickly, effectively and safely.
A range of other reforms is needed
including in relation to the requirements
for all practitioners to be licensed
or registered to
participate in the
building industry.
In addition, the
mandatory inspection
requirements need
to be reviewed to
ensure an adequate
standard of minimum
inspections is
undertaken of work in
progress.
Hand in hand
with licensing
and registration
requirements, there needs to be a
scheme that makes it mandatory that
all practitioners maintain knowledge
of their area of practice before they
can qualify for ongoing registration or
licence renewal. Governments that issue
licence renewals without obligation to
demonstrate suitability for ongoing
practice are just taxing participation in
the industry.
The final piece in this jigsaw is the NCC
BCA itself. There remain ambiguities
regarding how the NCC BCA 2019 deals
with cladding and what is and is not
allowed regarding combustible types
of cladding. There needs to be further
work done to address these ambiguities
so that with the introduction of the NCC
BCA 2022, it will no longer be a factor in
future non-conformity.
AIBS believes that the reforms and
other measures necessary will not
happen with a single voice making
these calls. AIBS is actively working
with other industry bodies to ensure
that governments hear the call and
respond to the recommendations
made in Shergold and Weir’s ‘Building
Confidence’ report and in the findings of
the Senate Inquiry into Non-Conforming
Products and Asbestos.
The BMF has developed an
implementation plan which responds to
the ‘Building Confidence’ report which
confirms the fears held by many that
each jurisdiction is essentially going
their own way on each recommendation,
often choosing to do nothing. The
Building Ministers have failed to meet
the challenge of coming together and
resolving an agreed pathway to reform.
Without reform, there won’t be
access to appropriate
professional
indemnity insurance
cover, practitioners
will decline to engage
with work they
cannot be insured
for, and where claims
continue to arise, one
by one, practitioners
will cease to exist.
The handbrake that
this would place on
the entire economy
as it struggles to
obtain design advice, documentation,
assessment services, approvals,
inspections, occupancy authority and
even to find practitioners prepared to
undertake projects, has the potential to
be profound.
There is no backstop in local
government, even where local
government maintains involvement
in the assessment and approval
process. While there are bright spots
within the local government sector,
the specialisation and customer focus
that is available via private sector
involvement in building assessment
simply cannot be replicated across the
local government sector so that the
whole of industry would be reverted to
1970s style approvals processes and all
the costs and timeframes associated
with that.
We believe there is a better
outcome available right now and hope
that we are not the only voices calling
for the necessary changes to be
implemented.
The UK
government has
just announced a
200-million-pound
fund to be used
for remediation of
cladding risks.
AIBS