Tuesday, 30 May 2023

Building Legislation Amendment Bill 2023

Second reading

Debate resumed on motion of Jaclyn Symes:

That the bill be now read a second time.

David DAVIS (Southern Metropolitan) (16:35): I am pleased to rise and make a contribution to the Building Legislation Amendment Bill 2023 and to indicate that the opposition will not oppose this bill, although we do have some amendments, which I will circulate shortly.

To give a short summary of the bill, it amends the Building Act 1993 and thereby allows the appointment of a state building surveyor and a building monitor. It makes provision for certain information sharing and data exchange in categories of building practitioner and puts in place an offence relating to building practitioners, requiring building surveyors to give certain information to people to whom building permits are issued. It provides for building manuals to be prepared and updated. It allows for a number of other purposes. Money can be paid out by the Cladding Safety Victoria account. It also allows changes to the delegation authority of the Victorian Building Authority (VBA), and I will come back and say more about them shortly.

It amends the Architects Act 1991, to make changes to the governance and procedures of the Architects Registration Board of Victoria, and the Domestic Building Contracts Act 1995 in relation to the disclosure and sharing of information by conciliation officers under the act. It amends the Building and Construction Industry Security of Payment Act 2002 and the Victorian Civil and Administrative Tribunal Act 1998 in relation to the disclosure and sharing of information or data, and the Owners Corporations Act 2006 is also amended through some consequential amendments. On Cladding Safety Victoria matters, the Owners Corporations Act amendment will allow the provision of an approved building manual at the first meeting of an owners corporation.

This is a modest bill, let us say, and I should indicate that there has been considerable work done on this bill by the opposition – by our Shadow Minister for Planning David Hodgett and by Wayne Farnham, the member for Narracan, who has obviously got building knowledge and experience that he has brought to the fore with this bill and related matters. I put on record the thanks of the opposition to those two and to the very large number of people that they have consulted with, including the many building bodies and associations – the Housing Industry Association, the MBA, the Urban Development Institute of Australia, the Real Estate Institute of Victoria, various architects, including the consulting architects and the institute of architects, and building surveyors. The planning institute has also been consulted here, as has the property council, Ratepayers Victoria and the Municipal Association of Victoria. They have done extensive work working through a number of these points.

It is fundamentally a bill about greater consumer protection but is, as I say, a modest bill. It links into the work of the building system review expert panel that has been around as a way to improve building reform. The cladding levy is a separate matter, and there are implementations around recommendations from stage 1 of the expert panel report.

The first change that comes to mind with the bill is the formalisation and strengthening of the role of the state building surveyor, and this is a good step. That is already a role that has been established at the Victorian Building Authority, but it will give it a statutory underpinning as the primary source of expertise and technical guidance for the building and plumbing industries. That includes the power to issue binding determinations relating to a number of technical and other aspects of building and plumbing regulations with codes and standards.

A second component establishes a building monitor to represent domestic building consumer interests in the system. Part of the logic of this is that there is an alleged series of systematic issues, and I think that is right. I think we have seen a whole series of issues across the building industry. Any electorate officer understands that you do get people coming in with serious issues and, frankly, miscarriages of the way we would all want to be treated, so there is a need for reform. As I say, I do not think this building bill gets there, but there are some worthy and practical matters in it.

It expands the categories of building practitioners required to be registered and enables the regulation of building designers, project managers, site supervisors and building consultants to ensure, in theory, that the practitioners have the necessary skills or qualifications to carry out parts of high-risk work. Although, as you will see, that is not as sharply defined as we think it should be.

The bill enhances the approvals process, including by requiring relevant building surveyors to provide their clients with an information statement requiring building manuals to be prepared for certain classes of building. The information statement aims to address the lack of consumer understanding about the role and functions of building surveyors in the permit process. With the building manuals, the plan is that they are intended to provide a single repository of all information relevant to the construction and subsequent building works on a building and any relevant maintenance work. It does create, in theory, a one-stop shop and in that sense is an improvement.

A final component relates to the expert panel’s work. It amends the distribution of the cladding rectification levy to provide financial and other support to owners who are not eligible to receive funding under the current program, which is administered, I think, by Cladding Safety Victoria. The authorities at the moment cannot authorise that the cladding levy be used to fund activities where the final rectification solutions are not funded by the state. The amendments provide greater flexibility in how the levy can be used, and this needs to obviously be acquitted satisfactorily.

There is a concern about inspections of high-risk buildings and provision for local councils to undertake pre-occupation inspections of high-risk buildings. I think on balance we welcome that – sorry, that was in the 2022 bill but is not in this bill, we note.

I should say that industry stakeholders have stated to the Liberals and Nationals that they are supportive in general of the legislation. They have suggested a number of strengthening requirements for building surveyors practising in Victoria to be members of professional standards schemes. I think this is a complex area. There is of course a significant workforce shortage at the moment, and I think that needs to be a significant focus of the government, a significant focus of the VBA and a significant focus of the training system.

The bill has other obvious weaknesses. Again, on the electorate office test, what is coming through the electorate office is a range of faults that are not well managed. Waterproofing defects is one of them. There has been a very high percentage of these over at least a couple of decades, and there is no clear solution in any of this, I might add.

I should indicate that the opposition will move some amendments. If they could be circulated, that would be helpful. We would welcome support for those. Again, I think these were amendments that were discussed at the briefing. I was not at the briefing, but I am told they were discussed by the opposition at the briefing.

Amendments circulated pursuant to standing orders.

David DAVIS: While those amendments are being circulated, I might draw the chamber’s attention to the need for better regulation of building more generally, and I think the community understands this. What we have seen in this recent period is a catastrophe really in the way Porter Davis and a number of the other firms that have been hit have not been able to help their clients. Their clients have been left high and dry. The government was initially very slow to respond, and still the solutions are imperfect. It is clear that many people have been caught after they have signed contracts. They have put very significant contributions forward and many of them have now lost those contributions, and the progress on their buildings at whatever stage it was, whether it had started or whether it was yet to start, has been stalled. There are so many families that we are aware of, and I think the community’s heart goes out to those families.

I pay tribute to the work of my leader John Pesutto and the team around him – Jess Wilson, Wayne Farnham and others – who have been consulting widely with those affected and with the building industry. They held a building summit to discuss the problems that were faced and to try to find useful solutions, try to propose solutions, because the truth is there was a significant vacuum for that period, a really very unsatisfactory vacuum where the government sat on its hands and did not act. There were clearly families that were in desperate straits, and I pay tribute, as I say, to the work of the opposition team, the housing team that have been working very hard on this to try and provide and find solutions and proposals that will at least help in this regard. One of the things you can do in opposition is to lead with ideas and proposals, and by doing that John Pesutto, Jess Wilson, Wayne Farnham, David Hodgett and co have shamed the government into acting to support some of those who have been left high and dry. I think it has been very unfortunate that they have not had that early action from government.

It is very interesting to see that Danny Pearson, the Assistant Treasurer, did not act early on these matters. He did not act on the warnings that the Victorian Managed Insurance Authority (VMIA) was not up to scratch. He did not act early on some of the points of warning that had come to him, including in a briefing provided to him on 11 July 2022 headed ‘Insolvencies in the residential construction sector and options to de-risk consumers’. That was a Department of Treasury and Finance brief provided to him as Assistant Treasurer. It was about insolvencies in the construction sector, and obviously he did not act at that time. The rest is history in one sense, and we cannot unwind the history that has occurred. There is his culpability, his failure to act and his failure to take those steps at an early point and protect consumers properly. I do not know whether electoral matters weighed in his mind in July last year; I do not know what was in his mind that he did not choose to act.

It is a matter of fact now that the government has been dragged to act, it has been forced to act, but it would have been much better if it had acted earlier and sought ways to prevent these problems occurring. It is true that not all these problems are the government’s fault. Let us be quite clear about that and be very reasonable about this. There are labour shortages and there are price escalations that are occurring in part because of overseas factors, but you have got a government that is slapping new taxes all around on construction, putting new taxes and new charges through the construction sector and forcing new arrangements in place which have not helped the sector.

It is not all the Ukraine and us pointing at the Russians and so forth as the cause of increased prices in the sector. It is one component; it is only one component. There are other components. Inflation is there of course too. But with the state government, you have got to ask what it could have done to bring prices of properties down – what it could have done and what steps it could have taken. One of the things it could have done is it could have brought on more supply, and it did not bring on more supply. That would have helped keep the price down. It would have helped keep in check the costs of construction and the costs of properties for young families that are seeking to get into home ownership. Instead of that they have closed down supply and made it more difficult. I say very clearly here that I do not blame the state government entirely, but I do not let them off the hook entirely either. There are things that the Assistant Treasurer could have done. He clearly had a list in front of him in July last year, and he chose not to act on any of it. Now, he can wash his hands like Pontius Pilate if he wants, but that is not going to actually help him. The community knows that the government ought to have acted.

Let us be clear about the scheme that we have had in place with the VMIA. It is a very poor scheme; it is a genuine last resort scheme. People sign up to that insurance thinking, often I think, that they are getting a product that is a much broader and more satisfactory product. Instead of that the builder basically has to die, become insolvent or abscond. There need to be the most extraordinary circumstances for people to access that. I think it is true that we have had an unsatisfactory system. The state government have been in power now for nine years – nine years! No-one else is responsible; it is the state government that sets the regulatory framework here. This bill is a slight tweak to that regulatory framework, but they cannot point the finger and say that it is this one or that one. It is the state government’s ultimate responsibility. I think in that context it is important to have got on the record that the state government ought to have done more and ought to have done things a lot earlier.

There are some points made by the Scrutiny of Acts of Regulations Committee, and I will leave those on this occasion. There are a number of points that we made, as people would be aware, and I draw attention to those comments made by SARC.

The amendments that we propose to clause 48 allow for a number of simple changes to occur. With new categories that are being introduced, there is no qualification attached to the categories that are being proposed. The conversation was that this is only for high-risk construction – that is, high-rise, major works et cetera. This was at the briefing. The fear I think that people like Wayne Farnham and others point to is that there are a number of unintended consequences of the bill and that they filter through into domestic instruction. At the moment the bill does not define high risk clearly enough. It needs to be a lot narrower, if in fact that is the intention of the bill.

With respect to the building consultant category, there is a concern again that there is no qualification for this category. When referring to prepurchase due diligence, inspection, essential safety measures and maintenance, disability access and energy efficiency work, anyone who is inspecting these works should have a qualification, the opposition would argue, equal to the building surveyor category. A lot of these issues should be inspected by a building surveyor, arguably. In regard to energy efficiency, we have seen all sorts of schemes and arrangements in place, and most of us are very keen to see better energy efficiency, but to achieve those aims you need to have high-quality people in place and standards that ensure that what you are fitting is actually what it says it is and that what is fitted is fit for purpose.

If we talk about energy efficiency, this should actually start at the frame stage and sometimes even the pre-slab stage of construction. Frame inspection should occur before insulation is installed so that building surveyors can see connections et cetera within the structure of the frame. When the insulation is installed, it becomes more difficult to see and inspect. Ceiling insulation is also important, and you need to be able to inspect that properly. Disability access work should also fall under the responsibility of the building surveyor. There are a number of these key points that members of the opposition have made publicly and that our amendments respond to.

The site supervisor category is another one. A lot of supervisors in the industry have qualifications away from the construction sector. If this is to become a sensible category again, there is a set of questions about what qualifications should be attached to that. A number of my colleagues expressed concern about the unintended potential in the bill, and they fear that this could just become a category and filter into domestic construction, where a lot of builders will have unqualified supervisors who may not meet some of the standards that are appropriate for larger and more extensive construction locations.

I would welcome any commentary that the minister may wish to make on a number of these points. I just make the point here that these amendments are put forward in good faith. They are not seeking to make political points, as it were, but they are put in place to see if we can make some sensible improvements in the way a number of these sections of the act would operate. Again, this is a bill that we are not opposing. It is a bill that we see there is some merit in. In one sense, whilst minor and modest points are welcome, at the same time the bill falls well short. The problems in the building industry at the moment are very significant, and the government does not appear to have grappled with these problems closely. The government does not appear to have taken the steps that are required.

I should say something here about the Victorian Building Authority. I mean, many of us have known for a number of years that there are problems at the VBA, and in fact I have raised matters in this chamber over the years. The VBA has been a body that is not fit for purpose. I notice that the CEO has taken a walk, and that is welcome. It is clear to me that she is not up to it. There is a new CEO being put in place. That is also welcome. The VBA is a body that has got to do the work. It has got to actually have a sensible set of arrangements in place. It has got to be transparent. I am worried about the cost structures at the VBA. It is not that many years ago that we had an earlier predecessor completely out of control, but the VBA I think is a body that is ripe for overhaul, ripe for repair and ripe for proper examination and review. It is a body that I do not think most of the industry has confidence in, and it is a body that I do not think consumers have confidence in either. It is not that it is pro industry, and it is not that it is pro consumer. It is just a blancmange that does not regulate properly, and that is in many respects the worst of all worlds: where you get the costs and the superstructure of the regulation without the positive impacts of proper regulation. You have kind of got the worst of all worlds, not the regulation that I think most people would want to see.

The government, as I say, has not come to grips with the issues around the building demise that has occurred in this recent period, and there are literally hundreds and hundreds of families that are still in terrible straits. I know that the schemes that are being put in place now seek to help them, but still I think many of us have had people at our electorate offices talking to us about the problems that they are still facing. So I think there is a long way to go on this.

I do not want to, as it were, overly politicise this. I do get that there are other factors going on other than the government’s steps and the government’s behaviour. But the question you would ask yourself is: has the government taken all reasonable steps to help consumers? Has the government taken all reasonable steps to put in place a regime that will actually protect consumers? Has the government taken all reasonable steps to ameliorate some of the problems and cost burdens that are flowing through the system? Some of it, as I say, is not their fault. But the question is ‘What can we do at a state level?’, and the answer is quite a lot. We know that the minister was presented with many options back in July and he failed to take them.

Tom McINTOSH (Eastern Victoria) (17:01): The building industry is incredibly important to our lives and to our economy. It employs over 350,000 people, and at one point that included me and included the President in this place. It equates to $40 billion for the economy every year, and it literally puts roofs over our heads. Everybody wins when we build quality homes and when we do it safely. It is so important that all workers get home safely to their kids, to their partners and to their parents. I believe that quality and safety go together. When we build safely we get quality, and when we build to quality standards everyone from workers in the industry to the public and people living in these homes is safer.

Registering workers results in better work outcomes and results in pride – pride of profession and pride of work, resulting in quality work. We want professionals in the industry – professionals who become experts in their work and professionals who are well paid and make careers of their work. This leads me to talk about TAFEs.

Quality workforces require quality training, and I am delighted that this side invests in TAFEs. In my electorate in Eastern Victoria we have the wonderful facilities in Sale and Morwell that are thanks to the investments that this government and indeed the minister who is sitting right in front of me, Minister Tierney, have overseen in Victoria and in Victoria’s TAFE system.

Some of you here may have heard me speak about my excitement about the SEC. Not only will it result in cheaper bills and new renewable generation, but incredibly importantly it will provide pathways for a generation of Victorian workers through apprenticeships and traineeships. I am proud this government is continuing its commitment to getting apprentices and trainees into work across major projects in Victoria – and the SEC is an extension and a continuation of this – unlike those opposite, who slashed and cut and privatised, effectively putting the car in gear and taking their hands off the steering wheel. We saw a generation of workers who lost access to training and quality jobs. I always talk about the last of the overall wearers, the men – and they were mostly men, something which I am proud we are addressing to see that is not the case today and going forward – who stayed in jobs for a lifetime, but that was before the Kennett era of hire and fire.

I am also a very strong believer in consumer support and protection, and we have seen how vulnerable consumers can be in the building industry. The system is not currently set up to support consumers well enough, and the changes in this bill support consumers. At present there is no overarching peak body or dedicated organisation representing Victorian domestic building consumers, remembering that for consumers interacting with the building industry it most often represents the largest purchase they will ever make. Could there be more important consumer protections? The consumer protections in this bill are practical and commonsense, like the requirement for a building surveyor to provide an information statement.

In terms of looking after people who interact in the building industry, I want to note how it is important to look after the mental health of those who work in our industry and who, particularly in the construction sector, have some of the highest incidence of workplace accidents and suicides. It is so important to look after apprentices and trainees as they enter the industry. I have spoken before about new vocational VCE and TAFE. Whether they are coming in as young workers or mature workers, these apprentices can be vulnerable in the building industry, and the skills, qualifications and safety regulations all go hand in hand to ensure there are safe workplaces and safe homes as a result of the building process.

We are delivering better standards through the National Construction Code (NCC), including improved building access, health, safety and amenity outcomes. These include new mandatory accessibility standards for homes and apartments, which will ensure these homes are suitable for occupants across all stages of life. It is so important that the housing stock suits as many people in the community as possible. I have heard some say this will have a negative effect on the availability of housing, but this is not true. Having the maximum number of houses suitable for the maximum number of people reduces transaction costs in the market, improving its efficiency and ultimately outcomes – firstly, for people with different access requirements but then for everyone else as well.

An area I am particularly passionate about is energy efficiency in homes. Further changes to the NCC will significantly enhance energy efficiency requirements in houses and apartments, increasing home thermal performance to 6 to 7 stars, making new dwellings more comfortable and reducing energy costs for consumers. This will help reduce our emissions and provide more comfortable homes, both for owners and renters. Coupled with other state government policies like rooftop solar, battery rebates, bringing back the SEC and the development of the offshore wind industry, all of this will contribute to Victoria’s world-leading climate and renewable goals of 95 per cent renewable energy by 2035 and net zero emissions by 2045. It is estimated that Victoria’s energy system transitioning to renewable energy will increase gross state product by about $9.5 billion and help create 59,000 jobs, including 6000 traineeships and apprenticeships in solar, wind and emerging energy industries. More broadly our investment in training and skills is supporting the construction workforce of tomorrow. As I spoke about before, we do not want to see a gap in the next generation of workers. In 2023 there are 6300 fee-free TAFE places available in construction courses alone.

The Building Legislation Amendment Bill 2023 will deliver much-needed reform to Victoria’s building system, placing consumer protection as central to these changes. The government is alive to the fact that major defects in residential buildings cost Victoria $675 million each year, with residential apartments making up two-thirds of this cost. Strengthening our building system will benefit consumers, give builders and industry more confidence and certainly reduce the need for costly rectification works. This is part of the Andrews Labor government’s commitment to delivering a building system that provides safe, compliant and durable housing and buildings.

The bill will create the following reforms. It will formalise and strengthen the role of the state building surveyor (SBS), it will establish a building monitor, it will expand the categories of building practitioners that will be required to be registered, it will enhance the building approvals process by introducing further safeguards to better inform consumers, it will strengthen information sharing between statutory entities with a role in the building regulatory framework, it will amend the distribution of the cladding rectification levy and it will strengthen and improve the government’s arrangements for the Architects Registration Board of Victoria under the Architects Act 1991.

The Andrews Labor government provided $2.3 million in the 2022–23 budget to establish Victoria’s first state building surveyor. The state building surveyor was established by the government as an executive staff member of the Victorian Building Authority (VBA) to provide authoritative compliance advice, technical guidance and interpretation of the relevant building standards. The bill will give the state building surveyor a statutory role as the primary source of expertise and technical guidance for the building and plumbing industries.

This will encourage improvements to regulatory oversight and practices within these industries, with a particular focus on the building surveying profession and councils. The SBS will have the power to issue binding determinations relating to technical interpretation of building and plumbing standards and requirements. Industry practitioners will be required to ensure that they carry out building work or plumbing work or exercise particular functions in accordance with any relevant binding determination. This will deliver greater certainty within the industry and help deliver better building outcomes.

At present there is no overarching peak body or dedicated organisation representing Victorian domestic building consumers. This means that the building system is designed in a way that does not sufficiently consider the needs, abilities or experiences of domestic building consumers, and their voices are absent from key decisions made about the building industry. The building monitor aims to address this gap, with the responsibility of representing and advocating for consumers on systemic issues within the building industry. The government provided $2 million, as I said before, in the 2022–‍23 budget to establish this role. The building monitor will advise the Minister for Planning on systemic issues and risks facing domestic building consumers. This includes engaging with domestic building consumers to understand their experience in the industry. The building monitor will publish an annual building monitor issues report with key findings and recommendations to government.

Consumers have an expectation that practitioners have the appropriate experience, skill and qualifications to be performing key roles in the building industry. Registration of building practitioners is an important market entry tool to ensure competence, accountability and regulatory oversight. The bill will expand the building practitioner registration system to achieve greater national consistency, thereby improving compliance with national building standards and facilitating national labour mobility. The existing category of draftsperson and a description of project management will be renamed ‘building designer’ and ‘project manager’. The bill introduces two new categories of building practitioner: site supervisor and building consultant. Consistent with how existing categories and classes of building practitioner are set, the regulations will prescribe the authorised work and registration requirements of these practitioners, and the industry will continue to be consulted as part of these changes.

The bill introduces a requirement that a draft building manual be prepared by the applicant for an occupancy permit and that that be provided to the relevant building surveyor for approval. Building manuals are intended to be a single repository of all relevant information relating to the design, construction and ongoing maintenance of a building. The building manual will address a significant hurdle for owners and owners corporations in accessing information about their building. By making information about the design, construction and maintenance of a building more readily accessible, the building manual will support not only the owners and owners corporations but also other parties such as building practitioners and regulators in future. Once the draft building manual has been approved by the relevant building surveyor, the manual will be provided to the owner or the owners corporation, who will be responsible for maintaining and keeping the documentation current. Subsequent amendments to the Building Regulations 2018 will prescribe a number of matters necessary to operationalise the building manual requirements, including what classes of buildings and building work will require a manual to be prepared or updated, the digital format of the manual and the information that must be contained within that manual.

The bill will require the relevant building surveyor to provide at the time of issuing the building permit a document that clearly details their roles and their responsibilities. This will improve consumer understanding about the role and functions of building surveyors in the building permit process. The Victorian building sector is made up of a number of agencies, each with an important role to play in maintaining a safe and well-regulated industry. A number of reviews, including the building system review stage 1 report, have highlighted that a lack of coordination, information sharing and data collection is a central issue for regulating the building industry. Consumers are often frustrated at the duplication of processes or requirements to provide information to different entities within the building system. There is an expectation that building system entities should work together to support how consumers interact with the system. Different entities will often be required to interact with the same consumers for different purposes. For example, a complaint about non-compliant building work may be made to the VBA for action under the Building Act 1993, and a dispute about the same building work may be managed by Domestic Building Dispute Resolution Victoria in accordance with the Domestic Building Contracts Act 1995.

While agencies generally have arrangements in place to communicate and share information about particular matters, this is often done at an individual level and limited provision is made for considering information about the building system at a systemic level. The government is taking steps to enhance the ability of these agencies to better share information and improve collaboration. By integrating building systems information, clarifying information-sharing arrangements and making that information accessible through clear pathways, participating agencies will have the opportunity to aggregate data to better inform targeted and evidence-based decision-making. This will also enable better transparency and better reporting on the health of the building system.

I would like to close by simply highlighting the challenges that have been faced in the building industry. The building regulatory system has not been comprehensively examined since the early 1990s, and since that time there have been significant challenges to design and construction practices. These changes have led to a growing disconnect between the regulatory framework and industry practice. Several high-profile building failures in Australia and around the world have reduced the public’s confidence in the building regulatory system. This includes the use of combustible cladding, which led to the 2014 fire at the Lacrosse apartment building in Melbourne’s Docklands, the 2017 Grenfell fire in London and the 2019 fire at the Neo200 building in Melbourne’s CBD.

Aiv PUGLIELLI (North-Eastern Metropolitan) (17:16): I rise to make some brief comments in support of the Building Legislation Amendment Bill 2023. This bill aims to strengthen the regulation of the building industry in Victoria and to improve protections for domestic building consumers, both timely and important reforms, as for years we have been failing at both. In Victoria we have let the development and building industry run riot over our city for years, and while I know all of us in this chamber agree that in a housing crisis we need thousands more high-quality affordable homes and more medium- and high-density housing, we also need to properly regulate the development industry to ensure these homes are built to a high standard and are actually affordable.

For years we saw thousands of poorly built, badly designed homes across the state. Developers and builders were able to cut corners and do things on the cheap in order to maximise their own profits, and the result was a scourge of substandard and even dangerous homes – mould infestations caused by leaking roofs; cracks in walls and floors; and cheap, dangerous, substandard materials used in construction, like the combustible cladding that was used in the construction of thousands of apartment buildings across the city. It was possible to cut these corners because our regulatory system was not up to scratch and the systems in place to provide oversight and checks on construction standards and materials were clearly not working. This was a result of the mass privatisation of the Kennett years, where domestic building was deregulated and largely privatised. The privatisation of building surveyors meant builders were able to choose their own surveyor rather than go through council and simply hire yes-men who would tick off building works, in turn allowing builders and developers to shirk the rules and cut corners.

The Greens are pleased to see this government commit to undoing some of the harm caused by the Kennett era neoliberalism by strengthening building standards and improving the quality of homes, including through the improvements identified by the building system review expert panel, some of which are included in this bill today. But there is more to do, especially as we have seen two high-profile failures of building regulation in Victoria in recent years. The first is the flammable cladding crisis, which is far from over. Since the scale of the crisis was revealed by high-profile fires at the Neo200 building and the Lacrosse tower, thousands of homes have been audited by the Victorian Building Authority and over 1500 have been rated as a fire risk due to dangerous cladding. For many of these households the dangerous cladding is just the tip of the iceberg. Initial quotes for cladding rectification frequently reveal multiple building defects, most of which need to be repaired before cladding rectification works can even begin. The second is the collapse of home builder Porter Davis earlier this year, which left around 1700 homes in limbo and hundreds of customers without a deposit. The failure of Porter Davis revealed that builders were frequently avoiding or delaying their responsibility of obtaining the necessary insurance for residential buildings before accepting a deposit.

This meant that about 500 Porter Davis customers had paid a deposit under the assumption that they were insured against insolvency and ended up losing this deposit when Porter Davis collapsed. This common practice in the industry has gone on for years, but the regulator, the Victorian Building Authority, had failed to crack down upon it. In both of these examples, customers and residents ended up in this situation through no fault of their own. Instead both crises were the result of a failure of government regulation and a lack of oversight. While the government has conceded some support for affected residents, too many are still being left to foot the bill.

Fixing building defects on top of initial inspection and legal fees plus the actual cladding works means that the full cost of cladding rectification runs into the hundreds of thousands of dollars. While the government provided some funding to cover cladding rectification, only some households are eligible to receive financial assistance to cover these costs – the cladding audit gives each home a risk rating of extreme, high, moderate or low, but only the extreme and high-risk categories are eligible to receive funding from Cladding Safety Victoria. For Porter Davis customers, the government announced a compensation package for customers who lost deposits due to the builder’s failure to take out insurance, but this was only for those who had signed contracts. Those who had paid some money but were still in the tender process were ineligible for the government’s package. We would strongly encourage the government to continue investigating ways to support all building consumers affected by the cladding crisis and the collapse of Porter Davis.

But the best protection for consumers is to prevent these situations from happening in the first place, and the best way to do that is to strengthen regulation and oversight of the building industry. The reforms in this bill, like expanding registration of building practitioners and new requirements for manuals and information statements from building surveyors, will go some way to improving our regulatory system, and we look forward to future reform in this space, including through the work of the building system review expert panel.

A brief commentary in regard to the amendment from the Liberals: we feel that the intentions of the proposed amendments would be better dealt with through regulation rather than with this bill. Also, specifically relating to the clause of review, we understand that there will be an oncoming formal review process and so the review clause, we are concerned, would lead to multiple reviews occurring at the same time. As such, these two points are cause for the Greens not to support the Liberals’ amendments.

Evan MULHOLLAND (Northern Metropolitan) (17:23): I echo the statement of my colleague Mr Davis, and I thank him for his thoughtful contribution to this debate. I would also like to acknowledge the Shadow Minister for Planning Mr Hodgett in the other place for his tireless work in consideration of this legislation put forward by the government.

I have to take a moment to respond to Mr Puglielli saying that we need to support the need for more housing in the middle of a housing crisis. As I said in my maiden speech, at the first sign of any new, sensible development for housing that would increase housing for my generation, protesters with green triangle placards show up quicker than a seagull to a chip on St Kilda Beach. We see that over and over and over again in the northern suburbs. Whether it be Greens representatives at the City of Yarra, whether it be Greens representatives at Merri-bek council or whether it be Greens representatives at Darebin council, the Greens representatives of local government have a storied history of opposing sensible development that would house, in a humanitarian way and a compassionate way, my generation and alleviate some of the pressures of the housing crisis my generation are facing. The Greens like to say in places like this that they are supportive of new housing to fix the housing crisis, but let us have a closer look at what their representatives do at a local government level. I certainly will hold them accountable for that.

As earlier speakers have said, this bill has merit. It responds to many concerns about our current legislative framework held by consumers and industry alike. It will, among other reforms, formalise and strengthen the role of the state building surveyor, establish a building monitor, expand the categories of building practitioners requiring registration and enhance building approvals by introducing further safeguards to better inform consumers.

There is room for more reform. There should be a requirement for building surveyors practising in Victoria to be members of a professional standards scheme, which would allow the industry to assist in regulating practitioners in a responsible manner and assist government in the building permit process. The workforce shortage of building surveyors in Victoria needs to be urgently addressed; the government must do more to encourage building surveyors into our state. Our councils are chronically understaffed of surveyors, which means that local communities have to go without many of the building control functions being administered effectively. The shortage of building surveyors is a particular issue for regional Victorians, and my colleague Ms Bath would know that all too well. Some of our regional councils and shires really struggle to have the same access to those surveyors as metropolitan councils do.

I am pleased to quote my colleague in the other place Wayne Farnham. Before he was elected earlier this year Wayne was a self-employed builder. He has been in the industry for more than 30 years. He notes that costs will come from new red tape in this bill and like everything the government does it will pass on the new costs to young aspirational families who are just looking for a new home. We have been told the intent of the bill is for high-risk construction only, but Mr Farnham notes there is no mention of high risk or a description of what high-risk construction is in the actual bill. My fear is that if we do not narrow that description, it will filter into all building projects and make our housing crisis even worse. This will raise the cost of new building and reduce supply, which is absolutely the last thing our economy needs right now. There is also a need for this bill to sharpen up the definitions of ‘building designer’, ‘project manager’, ‘building consultant’ and ‘site supervisor’ because, as Mr Farnham has noted, there is currently some overlap that makes these distinctions unclear and some terms are too loosely defined.

While with a few amendments these reforms are welcome, they still steer clear of the largest issues facing the Victorian construction industry. Critically the bill does not properly address the catastrophic collapse of major building companies in Victoria that is having a terrible impact on young families just trying to build their first homes. The northern suburbs, which I am proud to represent, are somewhat at the epicentre of Victoria’s construction boom. Unfortunately my community is also bearing the brunt of the fallout from Victoria’s building companies falling into administration.

While after weeks of limbo we acknowledge the state government has finally stepped in to secure some housing deposits, it did not need to come to this. We know from documents released under freedom of information that former Minister for Housing Danny Pearson was briefed by his department back in July 2022 on the risks in the residential construction sector and options to alleviate risks – a nine-month warning before the collapse of Porter Davis. The minister’s department was actively concerned about this developing issue and he was warned about the inadequate state of consumer protections. What was Danny’s response back then to that advanced warning? The same response he seems to have to everything in this place: putting his ministerial duties to one side and instead focusing on his share portfolio. As a result of that we have seen hundreds of Victorians being left with half-built homes and others being forced to go through a painful process to claw back their deposits on their unbuilt homes. The regulator has failed to make sure that when a building insurance policy has been taken out by a customer the builder has bought that insurance at the time they have paid their deposit. There is no question that this is a failure of government to ensure the most simple of consumer protections were adhered to.

My colleague David Davis is right to mention that the government has been somewhat dragged into acting, and this proves again the effectiveness of the Liberals and Nationals opposition. We called a housing summit. We were the first to meet with housing industry stakeholders and those affected by these decisions and have established a housing industry task force as well. We have been calling on – with the sector – the government to make sensible arrangements and holding them accountable for seemingly sitting on their hands when they were actually warned of the risks in the residential construction sector.

The legislation and the regulations are very clear in this space that insurance must be taken out at the time the deposit is paid. So why was the government asleep at the wheel in ensuring compliance? Why were audits not taken? The Labor Party represents what is the great majority of growth suburbs in this place, for now, so it is no wonder so many feel let down by the government, who have not been able to protect them because they did not take a proactive approach to ensure that people that they represent were not sent into a crisis they had been actively warned about.

We have been representing them. I have certainly had many people affected by the collapse of residential housing in my electorate in areas like Greenvale and in areas like Kalkallo, where the government seemingly have done nothing. Government members are seemingly not willing to be forthcoming with a response. Maybe it is the guilt, knowing they had a minister who was warned about risks in the residential construction industry and who was also seemingly more focused on his share portfolio than actually paying attention to the briefs that were sent up by the department on risks in the residential construction industry. What we see is a government that have seemingly been sitting on their hands instead of focusing on the people that they represent, the people that are doing it really tough because the government failed to act.

So I reiterate calls from my colleagues. Let us pass the opposition’s sensible amendments to this bill. This bill is a step in the right direction, but it can be better. Victorians should feel safe when entering into building contracts. When they take a step towards the great Australian dream of owning a home, we should back them.

David ETTERSHANK (Western Metropolitan) (17:33): I rise to speak to the Building Legislation Amendment Bill 2023 and commend the comments of Mr McIntosh and Mr Puglielli. Legalise Cannabis will support this bill. The bill provides for a number of sensible reforms. It introduces the statutory appointment of a building monitor who will identify and report on systemic risks and issues facing domestic building consumers and advocates on behalf of those consumers. The building monitor will work with building system entities and strengthen information-sharing between the Victorian Building Authority and other building system entities. It formalises the role of the state building surveyor as the primary source of technical expertise and guidance for the building and plumbing industries, and it requires relevant building surveyors to provide owners with information about the RBS’s role and responsibilities. The introduction of building manuals is a great win for transparency and owners rights. Accordingly, we are supportive of the legislation.

I understand that the opposition intends to move amendments to this bill. Legalise Cannabis Victoria will not be supporting those amendments. We are, let me say first of all, disappointed about not receiving a briefing from the opposition on these amendments, despite having requested that.

In respect of the proposed amendments relating to practitioner registration and the definition of ‘registered building consultant’, we are supportive of the proposed consultation process envisaged through the regulation reviews, and we are satisfied that these are both already adequately accounted for in the bill.

In respect of the proposed amendment for the exclusion of domestic building work from the scope of work for registered site supervisors, we are of the view that the amendment would not be appropriate, primarily due to the scope of that concept of domestic building work that is contained within the proposed amendments. Personally, I am deeply troubled that this proposed amendment would exclude oversight of high-risk residential apartment buildings, including Building Code of Australia class 1, 2 and 4 structures. I say this having seen firsthand the issues that arise in the construction of residential aged care facilities and retirement living developments in my role as a client representative over the last 10 years or so. During that time I saw some great builds and I saw some absolute shockers. I have also been involved in complex rectification projects, including removing flammable cladding from operating aged care facilities, and that has been a nightmare. In the removal of that flammable cladding, that which has been exposed has often struck me with the question ‘How did this building get approved in the first place?’, because those were vulnerable people in high-risk buildings. It seems to me that the amendments that are being proposed by the opposition would effectively take those buildings out of play for the purposes of the act, and that would be utterly counterproductive.

These kinds of facilities in all their forms, including residential apartment buildings, should be treated as high risk for the purposes of this act. For these reasons Legalise Cannabis Victoria will be supporting this bill and will not be supporting the amendments proposed by the opposition.

Jacinta ERMACORA (Western Victoria) (17:37): The Building Legislation Amendment Bill 2023 put forward by the Andrews Labor government outlines the commendable efforts undertaken by this government to address systemic issues in Victoria’s building industry. This legislation marks a significant milestone in ensuring the safety, integrity and sustainability of our built environment. A robust building industry is critical for the growth of our state. Community wellbeing is hugely influenced by the places where we live, work and play. However, in recent years we have witnessed alarming instances of building failures, substandard construction practices and breaches of safety standards. As mentioned in an ABC News article from 9 November 2022, the system was previously based on luck:

… Victoria’s building system was self-regulated with a lack of protection for final buyers and was defined by “uncertainty”.

Common sense would dictate that what is designed and what is actually built should align. However, currently the final construction of a building does not have to match what was originally designed; it just has to align with the minimum standards. We must recognise that most of our builders, designers and architects are professional and capable of complying with our building regulators. However, a number of poor-quality building practitioners contribute to the majority of our problems in this space, and it is now clear that our regulatory system does not help the situation. This means that consumers moving into new houses or apartments have to trust, without guarantee, that all of the processes were done correctly through the construction process and that they will not encounter unexpected problems after purchasing and moving into their homes. Sadly, there are countless accounts of frustrated homebuyers being hit with unexpected costs and inexplicable problems such as leaks and mould issues once they have moved in.

After establishing a world-first program in response to the cladding challenge, which a number of our colleagues here in the chamber have referred to, compliance problems with the basic construction principles were identified as a result. Removing high-risk cladding exposed many other issues. ABC Ballarat reported on 29 November 2022:

Black mould is being uncovered in the walls of defective apartment blocks, in what experts describe as an “absolute catastrophe”.

Workers have laid bare wall cavities riddled with black mould and rotten timber in poorly constructed apartment buildings …

This bill is a response to the building system review expert panel established due to the final report of the Victorian Cladding Taskforce and the Commonwealth Building Confidence report, which highlighted construction and cladding issues. This panel made a recommendation for a comprehensive review of Victoria’s building system and is conducting a root-and-branch examination of Victoria’s building regulatory system.

The government has placed consumer protection at the centre of the process, heralding a new era for the integrity of building regulation in Victoria. The government has become increasingly aware that major defects in residential buildings cost Victoria $675 million each year, with residential apartments making up two-thirds of this cost. Incidents and the uncovering of poor building standards have shaken public trust, calling for urgent action to rectify the systemic issues plaguing the building industry. The Building Legislation Amendment Bill 2023 represents a comprehensive response to these challenges. It introduces a range of measures designed to enhance accountability, transparency and professionalism within the building sector.

The bill will create the following reforms. It will formalise and strengthen the role of the state building surveyor. This is a role already established within the Victorian Building Authority, but this legislation will give it a statutory role as the primary source of expertise and technical guidance for the building and plumbing regulations, codes and standards. It establishes a building monitor to represent domestic building consumer interests in the building system. It will expand the categories of building practitioner that will be required to be registered, to enable the regulation of building designers, project managers, site surveyors and building consultants. The bill enhances the building approvals process by introducing further safeguards to better inform consumers with an information statement and requiring building manuals to be prepared for certain classes of buildings. It will strengthen information sharing between statutory entities with a role in the building regulatory framework. It amends the distribution of the cladding rectification levy, and it strengthens and improves the governance arrangements of the Architects Registration Board of Victoria under the Architects Act 1991.

These reforms will establish a robust regulatory framework that reinforces the responsibilities of building practitioners. It sets out clear obligations for builders, designers and engineers, ensuring they adhere to high standards of competence and professional conduct. By imposing strict penalties for non-compliance, the bill promotes a culture of accountability, holding practitioners accountable for their actions and driving the industry towards a higher standard of quality.

As a former local government councillor, I can cite numerous examples where homes were constructed not in compliance with the planning and building approvals. The issue is that the teeth of the enforcement were not strong enough to be a disincentive, and that is what is being addressed in this bill. For example, one house was built with an additional dormer window put in that was not included in the plans, and the particular legislation that construction was subject to only allowed for a $1000 fine. The consequence of not complying with the rule did not put off the non-compliance, so it just became a cost of construction and not really a disincentive.

Another example is a home that was built with an additional floor, but not an entire additional floor. It was like a verandah kind of thing. It was a lookout that was tacked onto the top, which also did not comply with the permit that they had been provided. Again, they were able to just apply for a retrospective permit and essentially got away with it. So it is really hard when the majority of people are complying with the rules and a few are not complying and just totally flouting the law, knowing full well that the consequence is not really going to play out very badly for them.

A comprehensive system of oversight and regulation for building products will be put in place with this legislation, which establishes a certification scheme to ensure that construction materials and products meet the necessary safety and quality standards. It sounds obvious, doesn’t it? By requiring mandatory testing and certification, the bill curtails the use of substandard and non-compliant products, safeguarding the structural integrity of our buildings and fostering public confidence in the safety of our built environment. This also includes new mandatory accessibility standards for homes and apartments, which will ensure these homes are suitable for occupants across the stages of their life. This is another example of the Andrews Labor government maximising the effect of reforms with mandatory accessibility standards, ensuring people can stay in their homes safely for longer, something of great importance for many communities.

Furthermore, the Building Legislation Amendment Bill 2023 enhances the powers of the Victorian Building Authority to enforce compliance and investigate potential breaches. The VBA plays a pivotal role in regulating the building industry, and these expanded powers will enable it to act swiftly and decisively against those who flout the rules. This stronger regulatory framework ensures that the VBA is equipped to detect and address issues proactively rather than merely reacting to incidents after they occur. Improvements will also be made to the Architects Registration Board of Victoria as a result of stakeholder feedback, with the composition of the board being amended to require a minimum of three members to be registered architects with leadership experience in the building industry.

Comprehensive stakeholder feedback was sought for this bill. Industry stakeholders, including the Housing Industry Association, Master Builders Victoria, the Municipal Association of Victoria and the Australian Institute of Architects, have been consulted on the bill. Broad consultation was also undertaken by the expert panel leading the building system review. The panel received 142 written submissions from stakeholders, including consumers, practitioners, unions, industry groups and local government, and engaged 40 key stakeholders in one-on-one discussions with eight workshops.

Responses to the panel’s consultation informed the development of this bill. I am pleased there are real examples in this bill of the government responding actively to stakeholder and community feedback. For instance, the government has decided to remove an amendment that would have introduced an additional building inspection to be undertaken by a municipal surveyor, and it is important to note that the industry is generally supportive of reform in the building industry to deliver greater certainty and improve the confidence of the industry and regulators. I support this removal because we know that adding regulatory burden does not always produce the outcome that you need. Sometimes it just adds a further burden, and we do have a shortage of building surveyors.

It continues to strike me that much-needed reforms made by the Andrews Labor government strongly align strategically with other significant milestones and a vision for our state. We know that the Andrews Labor government recognises the importance of promoting sustainable and energy-efficient building practices. This bill includes provisions that align with Victoria’s commitment to reducing greenhouse gas emissions and transitioning to a low-carbon economy. By prioritising energy efficiency and the use of sustainable materials, this legislation sets the stage for a more environmentally conscious building sector, reducing our ecological footprint and creating healthier living spaces for all Victorians and also creating jobs.

I was thrilled during the week to announce government funding for the construction of a new $5 million innovation and design centre at South West TAFE’s Sherwood Park campus, which will focus on providing renewable trade training. This was absolutely fantastic news for South West TAFE. The centre will include a large trades workshop and specialist equipment like green plumbing, solar and battery electrical systems, sustainable integrated building designs and new construction technologies. These renewable trade skills will augment the already growing renewable economy in south-west Victoria. These new emerging skills will play a role in the wind and solar sectors in our region and may even play a role in emerging technologies, some of which are under development at Deakin University in Warrnambool. I am very excited about the future development of hydrogen currently under construction at Deakin. We are going to have renewable trade expertise specifically in the space of renewable energy and technology developing side by side with possible future integration due to this government’s leadership. I am very proud that this new investment will facilitate the training of apprentices for future jobs in our carbon-neutral economy as well as having an established best practice for consumers due to the new regulations proposed in this bill.

In conclusion, overall it is crucial to acknowledge the broader context in which this bill is situated. The Andrews Labor government has shown unwavering dedication to addressing the systemic issues in Victoria’s building system. It has taken significant steps to rectify the failures of the past and prevent future issues from emerging. This legislation is a vital step towards creating a safer and more accountable and sustainable built environment. By strengthening regulations, promoting professionalism and prioritising safety and sustainability, the bill lays the groundwork for a future where buildings are constructed to the highest standards and where confidence in the building industry is fully restored. I support the bill.

Melina BATH (Eastern Victoria) (17:52): I rise to say a few words this afternoon on the Building and Planning Legislation Amendment Bill, acknowledging the fact that this is a recycled bill, or one that has been brought back into the 60th Parliament after lapsing in 2022, with some minor parts removed for a later date. The main purpose of this bill is to amend the Building Act 1993. I just want to put on record that I concur with my Liberal colleague the Honourable David Davis that the amendments that the Liberals and Nationals have put forward to this building bill are most sensible and practical in relation to the changes that will apply all the way through a number of different acts in relation to the automatic mutual recognition of building practitioners, building employees and plumbers who are registered or licensed in other jurisdictions. So we are replicating this in various other acts. It is the same with the Architects Act 1991 for the automatic mutual recognition of architects who are registered or licensed in other jurisdictions and indeed for the Surveying Act 2004 for the automatic mutual recognition of surveyors who are registered or licensed in other jurisdictions.

I take up my colleague Mr Mulholland’s point about the lack of surveyors in rural and regional Victoria. I know many of my councils in Eastern Victoria Region could expedite their processes considerably if they were able to attract and retain regional surveyors and municipal building surveyors in our fantastic part of the world. It is unfortunate. I know that they work as hard and as dedicatedly as they can, but they cannot duplicate themselves, so I put on record the importance of attracting people into rural and regional areas for work.

The main part of the bill that I would like to spend a little bit of time on is the protection of municipal green wedge land and the importance of it. I just want to reiterate the Nationals’ strong commitment to green wedge zones and the protection of these valuable landscapes and distinctive areas. It is a requirement for councils to proffer and review green wedge management plans, and this bill provides a mechanism through which this can be implemented. We always like the word ‘streamlined’. Sometimes streamlined can be more of a philosophy and an aspiration than an actuality, but this bill certainly seeks to streamline the process around endorsing a statement of planning policy for a distinctive area and landscape.

One of the beautiful parts of my electorate in Eastern Victoria Region is the Mornington Peninsula. Certainly it has a green wedge council, and it has done considerable work over a long period of time to find that balance, to work through planning and dwelling guidelines to create that green wedge zone and all the regulation that is required to sit on top of that, to get the balance between meeting the needs of a growing population – and people want to go and live in that magnificent area – and also having that balance and certainty for landowners, those people that want to build on land that is designated as green wedge zones, and businesses as well, to have that protection of distinctive areas and landscape. So it is an ongoing issue that needs to be dealt with sensitively and with respect and certainly acknowledging the fact that these also cost money to do – these plans. Whilst we certainly recognise the importance of green wedge management plans, sometimes there can be a requirement for councils to foot the bill for extensive consultation on this, and that can also have a bottom line and an impost on council financial implications. So it would be interesting if green wedge zones are brought up when we have the upper house inquiry into local government –

Harriet Shing: This is a different bill. This is the Building Legislation Amendment Bill.

Melina BATH: Yes, I am talking to it. In relation to the Building and Planning Legislation Amendment Bill, it is also really important to provide that clarity in the building industry. One thing that we have absolutely seen this last week is the uncertainty of construction materials, the supply of construction materials and the ability for Victorian builders to actually access those at a reasonable cost. We have seen when we are looking at builders that the carpentry can actually represent up to 20 per cent of the cost of the average new home –

Harriet Shing: This is a different bill. You’re talking about the planning bill; this is a different bill.

Melina BATH: I am looking at the Building and Planning Legislation Amendment Bill, and I am speaking about construction.

Harriet Shing: That’s from earlier this year.

Melina BATH: What I am making a point of in relation to the Building Legislation Amendment Bill is the fact that, because of the Andrews government’s decision on 22 May to close down the native timber industry, we are going to be footing the bill for construction materials – hardwood timbers – from either overseas or from New South Wales or from Tasmania, where they are still able to have a hardwood timber industry and support that. It is going to make it ever so much harder for our local builders to access that construction material and to work in this way. What we also know is that over the past 18 months we have seen the cost of a new home go up by 20 per cent, power prices have gone up and again only recently we saw that they have gone up both in the domestic sphere and also in the commercial. Those prices, borne again in construction material – glass, steel, windows and bricks – are all going to have to be factored into the cost of new construction.

Harriet Shing: We passed this bill earlier this year. You’re on a different bill. This is the Building Legislation Amendment Bill, not building and planning.

Melina BATH: Yes. Thank you. I have just nominated that we are speaking on the building registration amendment bill.

Harriet Shing: The Building Legislation Amendment Bill, Mel. You’re on the wrong bill.

Melina BATH: Minister, you can have your chance to sum up and make any comment you like at the end of this. That is fine.

My point around the building sector is that it is going to be, again, harder and harder for building practitioners to be able to access equipment, access construction material and support their industry and their welfare, and with that I say that the Nationals will not be opposing this bill. We do support Mr Davis’s sensible amendments to the Building Act 1993, and we wait for the committee of the whole.

Harriet SHING (Eastern Victoria – Minister for Water, Minister for Regional Development, Minister for Commonwealth Games Legacy, Minister for Equality) (18:00): We have heard a number of contributions today on this bill and indeed contributions on things like the green wedge which were the subject of building and planning amendment legislation which was passed earlier this year by the Parliament. That is worth noting by way perhaps of dispensing with some of the concerns that Ms Bath has just raised.

What I want to do is touch on the building regulatory system, which has not in fact been comprehensively examined since the early 1990s. We have seen around 30 years of change in the world which has not been matched by our regulatory system. Design and construction practices have changed in a really significant way, and there has been therefore a growing disconnect between the way in which the regulatory framework operates and industry practice on the ground. Several high-profile building failures in Australia and around the world have shaken the public’s level of confidence and trust in the building regulatory system. As a consequence of this, it is necessary to lean into those challenges and to create a more robust and consistent and accountable framework which, pleasingly, has the support of so many speakers in this chamber and indeed has enjoyed endorsement from speakers in the other place.

When I go to examples of what has occurred and has really challenged the sector and the industry and government, there is the use of combustible cladding and the 2014 fire at the Lacrosse building; the 2017 Grenfell fire in London, which was such a tragedy and really illuminated the challenges of the way in which materials are regulated; and the fire at Neo200 in 2019 here in Melbourne’s CBD was a really big wake-up call as well. The cost of this combustible cladding crisis has been substantial, and there is also a human cost, so the stress on home owners around that uncertainty as well as the risk to health and safety. This is where we introduced, as people would recall, a $600 million package to fix buildings with high-risk combustible cladding. Residential buildings across Victoria are costing, as a consequence of major defects, around $675 million every year, and residential apartments make up about two-thirds of that cost.

This bill, the Building Legislation Amendment Bill 2023, delivers a lot of reform to the building system in a way that directs change to those areas of deficiency that have been identified. At the heart of this bill is consumer protection and the way in which that leads to a range of remedies but also to processes which inspire a greater level of rigour and therefore public trust and confidence in the way in which the system operates.

There is a process whereby the recommendations of the building system review expert panel will be delivered, again lending greater measures of confidence to the industry and ensuring that we do have safe, compliant and durable housing and buildings. We have seen, as I said earlier, that these reforms are necessary – and I want to touch very briefly on a summary of what it is that many speakers in this chamber this afternoon have gone through – in formalising and strengthening the role of the state building surveyor with a statutory role as the primary source of expertise and technical guidance; establishing a building monitor to make sure that consumer experiences are at the heart of monitoring systemic issues in the industry; expanding the categories of building practitioner that will be required to be registered and also ensuring that practitioners have the relevant level of expertise and skill and qualifications to be performing key roles in the industry; and enhancing building approvals processes by introducing further safeguards so that consumers are better informed and can make better choices because of the information that they are provided in preparing to make surveyors part of the building manual and building requirement processes and information statements as well. We all know that the provision of information, where it is well prepared and where it is targeted at relevant audiences, does change consumer behaviour and does improve outcomes and reduce risk.

Amending the distribution of cladding rectification levies provides greater flexibility to determine how that cladding levy should be directed to support the rectification of buildings which are found to have non-compliant combustible cladding. There is also a strengthening and improvement of governance arrangements of the Architects Registration Board of Victoria under the Architects Act 1991.

Mr Davis has spoken to a number of components of the amendments. The amendments attempt to limit the scope created by this bill to require the roles of building practitioners, site supervisors and a building consultant to be registered. The bill itself only creates a power for government to regulate these roles, so the detail of the scope of work, qualifications and experience requirement will be determined through regulation, and this will also include consultation with stakeholders.

It is also important to note that, in relation to the building consultant category, the regulation-making process will consider any overlap with the authorised activities of other registered practitioners, such as building surveyors. This notes the distinctions between different practitioner types. For example, building consultants are intended to provide quality checks at defined stages of a build or to be engaged post occupation to investigate potential defects in a building. This is expected to include people who carry out due diligence inspection work, fire safety installers and maintenance providers, specifically those who are not engineers or plumbers already subject to a registration and licensing requirement, which we know is within the purview of a separate system. Disability access consultants, energy efficiency consultants and building supervisors play a regulatory role in providing independent oversight of building work to ensure that this work complies with standards and requirements. The bill also acts on the building system review expert panel’s recommendation to regulate the role of a site supervisor, and it will consider the kind of work that registered site supervisors will be authorised to carry out and related classes of buildings.

We want to make sure that we are not weakening protections for consumers and minimising oversight of the people who are carrying out work in high-risk buildings. As I said earlier on, major defects in residential buildings cost Victorians around $675 million every year and residential apartments are about two-thirds of this cost. So there is a compelling process around making sure that regulation takes place in a way that is transparent, in a way that is consistent and in a way that delivers on the objects of the bill. And we want to make sure we have an ongoing engagement, such as that which has led to wide-scale approval and endorsement and support of these changes.

Again, looking at the architects engagement and the minimum of three architects as part of the panel work, this is an important development around making sure we have that relevant level of expertise, making sure that we have skills and qualifications that assist better decision-making and making sure that we do have those protections in place into the future.

I am looking forward to this matter going through to the committee stage and being able to answer any questions, including as they relate to the amendment, but also making sure that we are responding to stakeholder feedback around additional inspections and removing that otherwise duplicating process that would not in practice lead to a better outcome as a consequence. Industry is generally really supportive of reform in the building industry, as I have noted, where it delivers greater certainty and improves confidence in the industry and in regulators. To that end, I commend the bill for consideration in the committee and thank you, President, for this opportunity to sum it up.

Motion agreed to.

Read second time.

Harriet SHING: I move:

That the bill be committed to a committee of the whole on the next day of meeting.

Motion agreed to.