Significant regulatory changes announced

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There have been some significant announcements in recent weeks on the regulatory front that I wish to keep you all informed about.
Last month I mentioned the launch of Multiproof, the National Muliti-Use Approvals process that went live on 1 February, and the promulgation of the Building (Minor Variations) Regulations 2009 that also came into force on 1 February.

I had further hinted at the launch of a more streamlined application process for qualified building practitioners to become licensed. The Minister launched this on 12 February but there will be some further refinements that will be announced in April.
One of the most significant releases was on Friday, 26 February, when the consultation document on the review of the Building Act was released for public comment.

This has the potential to change the landscape for residential construction in New Zealand as it canvasses a wide range of issues designed to generate “cost-effective quality”.
The Government recognises that the construction sector is a significant contributor to the economy. One dollar in every 20 is spent on construction, and one job in every 12 is employed in this sector.

However, productivity and confidence are low, and innovation is stifled by red tape. The Government is of the view that the system is out of balance, with councils carrying undue responsibility, forcing them into a very cautious approach which is costly.
It wants to introduce a more balanced building consent system, have risk-based consenting practices, back the people doing the work (ie, the licensed building practitioner) and build consumer confidence by providing better tools and information.

So what does the Government mean by a more balanced system? Well, essentially, it is exploring the potential to have certain low-risk buildings that are built by highly skilled and capable practitioners exempt from consent and inspection requirements, with streamlined processes for lower-risk building work, but existing processes for more complex, higher-risk buildings.
It wants buildings constructed right first time that are built by skilled and competent people (licensed building practitioners) that can be relied upon. In addition, it is proposed consumers will be better informed and, therefore, make better decisions, but also understand the consequences of their decisions.

There are a number of things the document explores, including inter alia, clarifying the purpose and principles of the Building Act and Building Code, reviewing the number of building consent authorities, improved contracting practices, the role of home warranties and whether these should be mandatory, and better access to dispute resolution mechanisms.

We will be looking at these very closely over the next two months and submitting our views on the topics and questions posed in the consultation document. We would urge you to do the same and go to the DBH web site for a copy of it.

Consultation closes on 23 April 2010, with final decisions expected by the end of June 2010. The Minister is hoping to bring the amended Act into force in 2011.