The Falling from Heights campaign — justifying the costs

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Following the publication of my article in Building Today September 2015 titled The Real Cost of the Falling From Heights Campaign, I sent copies to the Minister responsible for WorkSafe NZ, the Hon Michael Woodhouse and the Finance Minister, the Hon Bill English for their information and comment.

I did this because I had clearly identified that the current measures were adding an extra $10,000 dollars to the cost of a single-level build without proper due consideration or justification.

I had also identified that if we adopted the practical measures of the Australian Code of Practice for falling from heights, the extra $10,000 could be saved without any reduction in safety measures.

Given that housing affordability and low productivity within the construction sector are massive issues facing the nation, you would think that these revelations would be welcomed with open arms, but is this the case?

To read this article go to www.buildingtoday.co.nz/latestnews/magazine/tabid/8136/articleid/10094/default.aspx.

Minister Woodhouse replied in October, quoting the usual WorkSafe platitudes and refuting some of the figures I had used. I appreciated the time he took to respond but his letter raised more questions than it did answers. The Minister’s reply is above. 

It makes sense that measures that impact housing costs so significantly must be well thought through with a robust cost benefit analysis to back it up. Accordingly, after not getting any substantive answers from WorkSafe I decided to respectfully request this information from Minister Woodhouse.

I sent him the following letter, again copying in Finance Minister Bill English on November 6, 2015. 

Dear Minister

I refer to your response dated 16-10-2015 regarding the falling from heights regime and the justification of same. I really appreciated the time taken to respond and have a number of questions that have arisen out of your response.

It is also pleasing that you would like feedback on how regulation is actually affecting those that need to work with it.

I have attached for your information an article that was published in October regarding the recent Loopy Rules report which, I might add, singled out the falling from heights rules as vague and unworkable, needing much work.

This article will also give you valuable feedback on how the Building Act and Resource Management Act are seriously affecting construction costs and productivity. (If you would like to read this article it is available at www.buildingtoday.co.nz/latestnews/magazine/tabid/8136/articleid/11356/default.aspx).

It is undeniable that housing affordability and low productivity within the construction sector are two major issues facing the nation, so any regulation that impacts on them should be seriously considered before implementation.

Accordingly, would you be so kind as to assist with providing clarity around the justifications you have made in your response to me, as they do not correspond with feedback or real life experience from the industry.

1   Was a full cost benefit analysis carried out before the implementation of the current Falling from Heights campaign? If so, can it be supplied? If not, can reasons be given why such an all important step was overlooked?

2   You quote in your response that incidents have been reduced by 29.5% since the introduction of this campaign. Could you supply a detailed description of what constitutes an event, the actual number of events that have been avoided, and the cost that has been spent by the consumer to attain this result?

3   You have stated that scaffolding is only one of the measures that can be used to comply but nowhere within the guidelines does it state what complies. This goes to the very heart of the problem and is further backed up by the Loopy Rules task force report.

Could you please clearly set out the other options that meet the guidelines? Saying it is up to industry to tell you what complies is impossible under the current legislation.

4   You state that WorkSafe disputes the figures I supplied in regards to the cost to the consumer which are in excess of $10,000 per single-level build.

The figures I supplied were actual real life figures taken from over 100 sample projects, and are fully discoverable. It would be really helpful for the industry and the consumer if WorkSafe could provide a detailed breakdown of the figures they use, along with where one might sign up for these services.

Please be sure they include builders’ margins and overheads along with GST, as these are costs that the consumer pays. The builders I have corresponded with, including my own companies, cannot compete with, or locate, the rates that WorkSafe quotes.

5   If adopted, the Australian Code of Practice for falling from heights would give clarity and remove up to 75% of the current cost, but still provide protection from falls. Can you please provide reasons why we would not adopt this proven practical document for New Zealand?

I would appreciate if my questions could be answered frankly and fully.

I realise I have asked a number of searching questions, but they are all fundamental to the validation of, or rethinking of, this particular set of regulations.

Finally, in regards to your comment about going out to work and having the right to come home safe at night, that is an admirable and worthy statement, but does ignore that work comes in many forms, some with more inherent risk than others.

Racing car drivers, professional rugby players and other high-risk professions make a choice about risk and reward every day.

I look forward to your reply.

Regards
Mike Fox 

 

To my surprise I had no acknowledgment or response to the above letter, so re-sent the letter to both Ministers again on February 15, 2016, with a footnote, that there was a possibility the letter would be published.

Interestingly, I got a response within two days, saying their records did not show they had received it and that I should expect a response shortly.

I realise that the questions I have asked the Minister are detailed and searching, but the effect of blindly implemented and poorly thought through regulation that impacts costs and productivity deserves robust due diligence prior to implementation.

I don’t believe this was the case at all with the Falling from Heights campaign, and I awaited answers from the Minister with keen interest.

A formal response was received on March 4, and I have shared it below (along with my comments on the Minister’s answers).

I will let you be the judge as to the validity of his justification on these costly regulations.

 

Office of Hon Michael Woodhouse
Minister of Immigration
Minister of Revenue
Minister for Workplace Relations and Safety

4 MAR 2016

Michael Fox
mjfox@primesite. co.nz

 

Dear Michael

Thank you for your email of February 15, 2016, about building costs to the construction sector. Please accept my apologies for not responding to the concerns you raised in your earlier email. This was an administrative oversight and was unintentional.

I asked WorkSafe New Zealand officials to provide me with information about the issues you raised. I will answer each question in turn.

 

Question 1:   Was a full cost benefit analysis carried out before the implementation of the current Falling from Heights campaign? If so can it be supplied? If not, can reasons be given why such an all important step was overlooked?

 

Answer:   WorkSafe advises there was considerable research behind the development of the Preventing Falls from Height campaign. The then Department of Labour undertook a study of around 340 serious harm investigations, and analysed the data to determine causes of injury, which assisted in targeting the campaign’s messaging and efforts.

You can find this report on the WorkSafe web site titled Falling Short. There was then significant engagement with a range of industry players on the formation of the guidelines.

Author’s comment: From the Minister’s response, the short answer is that no work was done on what the financial implications of these regulations would have on the cost of construction.

 

Question 2:   You quote in your response that incidents have been reduced by 29.5% since the introduction of this campaign. Could you supply a detailed description of what constitutes an event, the actual number of events that have been avoided and the cost that has been spent by the consumer to attain this result?

 

Answer:   I am advised that the calculation was based on the decrease in the number of serious harm incidents. This is a standard legal definition included in the Health and Safety in Employment Act 1992 (the Act). I have enclosed a copy of the definition of serious harm and you may also access this on WorkSafe’s web site.

As can be seen from the table below, there were 21 fewer fall from height-related serious harm incidents in 2014 than in 2012. This represents a 29.5% drop from the 2012 baseline.

 

Fall from height-related serious harm incidents 2012-2014 in the construction sector:

2012:    No of falls from serious harm incidents: 71   % change from 2012: NIA

2013:    No of falls from serious harm incidents: 62   % change from 2012: -12.7%

2014:    No of falls from serious harm incidents: 50   % change from 2012: -29.5%

Author’s comment: So the current measures have resulted in 21 fewer serious harm incidents per annum. The definition of serious harm is far from descriptive or clear. The most appropriate definition I could glean is that a “serious harm incident is a bone fracture or any harm that causes the person harmed to be hospitalised for a period of 48 hours or more, commencing within seven days of the harm’s occurrence”.

We build, at a conservative estimate, 16,000 single-level homes per annum, and the additional expense of $10,000 per home results in an additional cost to the consumer of $160 million per annum.

Going a step further, we are spending $7.6 million to avoid each serious harm incident. Is that value for money? Could the consumer’s money be spent more effectively elsewhere? These are questions that were never answered before this regime was implemented.

 

Question 3:   You have stated that scaffolding is only one of the measures that can be used to comply, but nowhere within the guidelines does it state what complies. This goes to the very heart of the problem, and is further backed up by the Loopy Rules task force report.

Could you please clearly set out the other options that meet the guidelines? Saying it is up to the industry to tell you what complies is impossible under the current legislation.

 

Answer:   It is important to point out that the Act is performance-based legislation so does not prescribe what safeguards need to be in place for each possible circumstance. The Act aims to promote the health and safety of everyone at work and of other people in or around places of work.

To achieve this, it requires people who are responsible for work (and those who do the work) to take steps to ensure their own health and safety and that of others.

Falls from height are an obvious and well known risk and, as such, employers are expected to take “all practicable steps” to manage that risk. Whether a step is reasonably practicable, takes into account:

The nature and severity of any injury or harm that may occur,
The degree of risk or probability of injury or harm occurring,
How much is known about the hazard and the ways of eliminating, isolating or minimising the hazard, and
The availability and cost of safeguards.

The cost of dealing with a hazard is only one factor in deciding if a step is reasonably practicable. Cost would have to be measured against other factors, including the risk and seriousness of harm that might occur.

If there is a risk of serious or frequent injury or harm, then spending a greater amount of money to deal with the hazard is considered reasonable.

Guidelines are produced to provide practical guidance to employers, contractors, employees and all others engaged in work associated with working at height. Particularly, where small business might need extra support, this has led to fact sheets that provide additional support to the more general guidance.

As stated above, WorkSafe consults broadly with industry stakeholders on guidelines and fact sheets.

 

Author’s comment: This answer confirms what everyone operating within the industry already knows — the Act is flawed. First, it gives no description of what taking all practical steps actually means, with the resulting default position of over provision on site to avoid prosecution.

I asked a specific question above to please give some alternative examples of what meets the guidelines outside of providing a full exterior scaffold for a single-level build, to which no specific answer was forthcoming. If the Minister responsible can’t answer this, how are tradespeople on site expected to know?

 

Question 4:   You state that WorkSafe disputes the figures I supplied in regards to the cost to the consumer which are in excess of $10,000 per single-level build. The figures I supplied were actual real life figures taken from over 100 sample projects, and are fully discoverable.

It would be really helpful for the industry and the consumer if WorkSafe could provide a detailed breakdown of the figures they use along with where one might sign up for these services.

Please be sure they include builders’ margins and overheads along with GST, as these are costs that the consumer pays. The builders I have corresponded with, including my own companies, cannot compete with, or locate, the rates that WorkSafe quotes.

 

Answer:   WorkSafe is concerned that people keep mixing the costs of scaffolding with the costs of general health and safety requirements which would be incurred regardless of scaffolding (for example, security fencing is often included).

Its discussions with stakeholders have indicated there are a mix of costs stated, some lower than $10,000, some higher, and for some builders who have invested in scaffolding over time the costs are considerably lower.

However, the NZIER report commissioned by BRANZ may also provide additional information around this. WorkSafe has not yet viewed these results.

 

Author’s comment: WorkSafe has now gone from saying that it costs $2000 to $4000 per project to a reality position of confirming that costs can vary, some exceeding $10,000 per single-level project and some less.

However, it is a naïve pipe dream for WorkSafe to think that a builder doing any volume of work will purchase house lots of scaffold, arrange for storage, transportation and qualified staff to erect and dismantle the same.

The awaited NZIER report on the costs versus benefits associated with the Falling from Heights campaign will finally provide the missing factual information that has been so sorely absent from the beginning of this debate. It is heartening that WorkSafe is looking to view the results of this report.

 

Question 5:   If adopted, the Australian code of practice for Falling from Heights would give clarity and remove up to 75% of the current cost, but still provide protection from falls. Can you please provide reasons why we would not adopt this proven practical document for New Zealand?

 

Answer:   In respect of housing and construction and working safely at heights, the legislative framework in Australia and New Zealand are similar.

However, WorkSafe advises at regulation level the Australian regulations are more administratively burdensome, requiring a Safe Work Method Statement to be developed and complied with for all construction work involving the risk of a fall of two metres or more.

The approach of the Preventing Falls from Height campaign was to encourage the construction sector to apply sound hazard management methodology. In particular, it encourages industry to work through the hierarchy of controls. This is the “eliminate, isolate, and minimise” process.

The first 29 pages of the Australian Code outline legal duties and the range of control measures based on the Australian hierarchy of control. This is very similar to the New Zealand Best Practice Guide for working at height (BPG).

The BPG outlines the need to assess and plan work to be done at heights and to select the right equipment for the job. I have enclosed a copy of BPG showing the types of control measures to consider in order of effectiveness. You can find this information on page 11 of BPG.

The Australian code is specifically about preventing falls in housing construction and also provides specific guidance on safe methods for common tasks such as floor laying, and installing fabricated roof trusses (pages 30-45).

WorkSafe’s BPG is deliberately general and does not go into this detail as it is a guide for all industries. However, additional guidance has been produced:

Best Practice Guide for Work on Roofs
Fact sheets on:
Installing trusses, installing roof cladding etc,
Short duration work such as inspection and measuring on the roof, and
Roof restoration.

The above guidance were all produced with industry input. Please find fact sheets enclosed.

The Ministry of Business, Innovation and Employment has a work programme that will look at the Australian regulations, and how New Zealand should appropriately regulate hazardous work under the new Health and Safety at Work Act 2015.

At this time WorkSafe will also look at its guidance, and whether further improvements can be made.

 

Author’s comment: It is great that the Minister has picked up on why I espouse the merits of the Australian code of practice. I quote from above: “The Australian Code is specifically about preventing falls in housing construction, and also provides specific guidance on safe methods for common tasks such as floor laying, and installing fabricated roof trusses (pages 30-45). WorkSafe’s BPG is deliberately general and does not go into this detail as it is a guide for all industries”.

This is exactly what is missing from the New Zealand regulations, which are vague and deliberately non-specific — and that includes the additional fact sheets.

If New Zealand adopted the specific practical guidance of the Australian document, dollar savings could be made for the consumer without any appreciable loss in safety provisions.

 

Thank you again for writing.

Yours sincerely
Hon Michael Woodhouse
Minister for Workplace Relations and Safety

 

There is another way — if bureaucrats would only listen to those at the coal face.

Builders need certainty and cost-effective ways of keeping their sites and workers safe. The current mish mash of vague guidelines only results in a default position of costly over provision that is wasteful and, frankly, not good enough.

Expecting individual builders to come up with their own interpretation of what constitutes a safe solution and then have to prove it is misguided and never going to work.

If adopted, the practical measures as outlined in the Australian Code of Practice, could go a long way to providing those answers to safety, certainty and very significant cost savings the consumer deserves.

 

• This article contains the author’s opinion only, and is not necessarily the opinion of the Registered Master Builders Association, its chief executive or staff.