Ivan Dean, Speeches Index

Thursday 2 November 2006

BUILDING AMENDMENT BILL (No. 2) 2006

Mr DEAN (Windermere ) - The honourable member for Huon certainly has covered the issue very well and I commend him on the way in which he has done that and has raised the issues that I think all of us in this House have had considerable concern about for some long period of time. But there are some issues that I want to refer to, although at this stage I support the bill.

I am sure the Government has learned through its experiment with the Tasmanian Compliance Corporation that some things just cannot be privatised and I think that the Government would very clearly see that now, but it is unfortunate that it had to go to the extent that it did and cause the harm and the trauma that it has for the Government to find this out.

The passage of this bill will allow a new course to be charted in builder registration, not before time, and the member for Huon has mentioned that it has gone on for two to three years and really it has not been acceptable at all.

Mr Deputy President, long before the recent controversies led to those matters with respect to the TCC that are now before the courts, the building registration system in this State was in crisis. I think that is fairly clear from all of the reports, what we have heard and the involvement we have had. Regrettably, the Government chose the wrong model. Regrettably, the Government made a blunder. Regrettably, it is a huge blunder that, I believe, will haunt them probably forever and a day.

It has had a huge impact and the unfortunate thing about it is that a lot of this comes back onto the Parliament, to all of us not just the Government. I have had people ringing me about it, talking to me about it and they want to cast some blame on all people within the parliamentary system, and that is where I get very disappointed and frustrated with some of our systems. Builders have suffered under it; the expense of asset registration requirements has forced some in the industry to secure loans to stay afloat.

A secondary effect has been the creation of a high entry bar for new, younger builders to set up their own businesses. I just find this difficult. I must say that I was not in this House when the act was passed back in 2000 or thereabouts; I was not a part of this. I have had builders raise with me that as a part of their accreditation process assets should become a part of it. I cannot, for the life of me, understand why that is a part of the process to determine accreditation. It really should not matter what a builder has. It should not matter if you have $1 million in the bank and two Porsches parked in your garage. It should be based on the competency of a builder, their ability to build a good house, a high-standard house.

Mr Aird - The issue has been about whether it is a viable business. That has been the issue.

Mr DEAN - But, Mr Treasurer, there are many builders out there -

Mr Aird - I am not saying the issue you are raising should not be addressed; that has been the thinking in the past about why.

Mr DEAN - I guess hindsight is great.

Mr Aird - No, but you can understand: if you want someone building a house you want to know the business is viable so it can be completed.

Mr DEAN - No, I would beg to differ. The view I would take is that I would take into account the competency of the builder to build a good home.

Mr Aird - And you want to know that the house that they are building is going to be completed.

Mr DEAN - The system under which you normally pay is that you ought not to lose if your payment structure is right in any event. The system keeps good builders out of the industry and there are reasons at times a builder does not have the assets you would like them to have, I guess, to secure accreditation. It could well be that they are going through family difficulties with probably somebody in the family suffering medical conditions or health problems and the builder has had to contribute to that. Or there might be other very good reasons for their assets not being at the level that one would want to obtain accreditation under this scheme - very legitimate reasons.

Mr Harriss - You are right because the progress payment system within the housing industry, the best of the building industry, is structured so that - as you have already explained - it does not unreasonably expose people.

Mr DEAN - That protects you, and I can give the recent example of a friend who contracted a builder to build a home. There was some concern about the ability of that builder to complete the home because of a family situation but they were protected because of the progress payment system. The builder was a credible builder and highly competent in the area of building - and the person wanted that builder - but asset-wise the builder had very little because he had just gone through a family break-up. The registration process, it seems to me, has been a pretty complex, time-consuming rigmarole.

As recently as Monday 30 October, staff in my office experienced difficulty in navigating through the TCC web site and I shall cite two examples for you. Under the heading 'Insurances' the TCC site said somewhat cryptically, 'The ministerial insurance order is available at the BSR web site'. Unfortunately, Mr Deputy President, that link to the ministerial insurance order led to nowhere - there was nowhere to go. Such a web site you might think might be straight as an arrow about who, in fact, must be accredited under law because accreditation was the sole reason for the TCC operating in the first place. The TCC web site does make a start; there is a key heading shaped as a question: 'Who needs accreditation?'. Then it goes on to provide this strange answer, and I want to quote that answer:

'This guide to the qualifications required for accreditation in Tasmania under the Building Act 2000 is a summary of the legislative requirements only. The full text of the Building Act, Building Regulations 2004, and the Plumbing Regulations 2004 and other important information resources about building legislation, codes and advisory publications are available on the Building Standards and Regulation website or contact the Workplace Standards Helpline ( freecall in Tasmania) 1300 366322 or outside Tasmania (03) 62337657'.
There is also an e-mail address provided.

Mr Aird - I've read it actually.

Mr DEAN - You want me to read it out? I do not need to. In other words, Mr President, if you were a builder in recent times, trying to determine the accreditation requirements that only the TCC had been authorised to issue, then you would have to go to the Government anyhow, if you wanted to be absolutely sure you had read the full text and other important information about building legislation and codes. So you had to go to the government site in any event. It is quite extraordinary really.

As the TCC puts it, they have been providing a summary only about who needs accreditation. Wouldn't you have thought that they would have provided the lot, all of the information?

Ms Thorp - Are you supporting the bill?

Mr DEAN - I support the bill because hopefully it will get us out of the significant difficulties that we have gone through and the builders have gone through.

How confusing this must have been for builders to deal with an organisation that has obviously been neither fish nor fowl and in more ways than one. For instance, I have seen the TCC described as a not-for-profit private company and if any honourable member can educate me about the meaning of that phrase I would be very pleased and grateful. It is a very difficult term to understand.

Mr President, I will not go on belabouring the point about the TCC's failings, except to say that I do earnestly hope that the Government now regards the company's own removal as an opportunity to set a clear, strategic goal for the delivery of a better, cheaper and more efficient system that will benefit both the building industry and consumers. Indeed, the Government would be well served by taking the view that it had an obligation now to bend over backwards and put things right. The builders, very clearly in this State, have been burned. They have lost confidence in the system and all stemming from a questionable partnership deal, of course, with a company left wanting in many areas.

I hope the minister and advisers, including the Director of Building Control, keep this uppermost in their minds as they reshape the building accreditation scheme. I hope the minister is demanding and insists that all changes must be justified on the basis that the principal reason of any registration scheme is the provision of some guarantees to the consumer, and that has been previously referred to by the other speakers. That does not mean a scheme that is complex with red tape and a time-wasting, costly confusion because in the end all of those things only add to builder costs and that in turn adds to the consumer's final bill. I think we need to be careful of all of these issues. At the end of the line, the consumer picks these costs up. Builders do not want this and, what's more, they do not need it.

I concur absolutely that the best interests of everybody can only begin to be served by the enactment of this bill and its proclamation. As an insurance that it sincerely does mean to fix this problem, I would suggest that Cabinet requires the minister to account to it on a quarterly basis over the next year as to how the restitution to government control is working in practice and to report to Cabinet on those occasions, a current and accurate view of the builder sector. It ought to be that quarterly reporting. It ought to be a part of the process. This problem was of the Government's own making.

Very clearly the member for Huon touched on the monitoring process which was supposed to have occurred. I have similar concerns that he identified; that there seems to be a lack of evidence that there was any monitoring at all, or very little monitoring of TCC. I am of the view that had the monitoring taken place at the level at which we would have expected it to take place, the Government may not have been in the embarrassing position that it is currently in.

Ms Thorp - You are aware that there was a group formed to monitor the whole setting up that met regularly - I think you are quite aware of the fact that it was representatives of departments, consumers, TCC - to iron out all those teething problems you are talking about.

Mr DEAN - All I can say is that there is a lack of evidence to demonstrate to me and, I would suggest, to a lot of other people - the member for Huon mentioned it - that the monitoring process was at a level expected in all of the circumstances. There is just no evidence to support it.

Mr Parkinson - The builders group met fortnightly, monthly and regularly monitored the process.

Ms Thorp - With all the statements. Issues about insurance and all kinds of things were ironed out.

Mr DEAN - If the level of monitoring was anywhere near what you say it was I would like to know a little bit more about the body that is doing the monitoring.

Mr Parkinson - Have you had a chat to Wayne Russell in Launceston, the MBA fellow?

Mr DEAN - I have chatted to quite a few people. I probably did chat to him about this. I have certainly spoken to many, many people.

Ms Thorp - I would be extremely surprised if any of the stakeholders in that group did not feel that all efforts were being made to monitor and look at the issues as they arose and as far as I know, the northern MBA group were part of the group.

Mr DEAN - I do not have any evidence of that and, as I said, there is a lack of it right through this whole thing. I must reiterate I am not convinced -

Ms Thorp - I am sure the Leader will be able to clear that up in his response.

Mr DEAN - I am not convinced that the monitoring process was at the level that we all expected. In this instance, Mr Deputy President, Parliament is being asked to clear the legislative decks so there might be remedy. As I said at the beginning, I support the bill because we have to move forward; we have to get this right. The builders out there are calling for it; they have said they have lost confidence and they are hurting. There are builders that currently, in my opinion, are outside the process and cannot get into it because of certain requirements. I would like to ensure that all of those things are taken care of so that we do not miss out on those very good builders that we do have out there who have few or no assets.

Ms Thorp - Through you, Mr Deputy President - before you sit down, the honourable member would agree, surely, that as well as being competent a builder should be solvent?

Mr DEAN - Yes. I would agree that competency is a very big issue and a builder must have the ability, or demonstrate the ability, to conclude a project. Yes, I would agree with that and I do not resile from that position, but when asset testing becomes a critical part of this whole process I have grave concerns that that it is not the way to go and we ought to be looking at making those alterations to take care of those builders, as I have said, who are competent, very good builders but currently cannot get back into the business. There has been a call for that. I have spoken to a number of builders; there are numbers out there, there are examples that you can get, many examples in actual fact. So I do support the motion.

Mr Parkinson - It does not matter what professional association you belong to these days, you generally have to pay a fee.

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