PM’S plan to fix building sector
partners working through a 6-9 month plan to gauge what accord initiatives were working, and which ones were not.
The accord comes after a wave of problems, including highprofile building company collapses, poor-quality builds which led to households facing billions of dollars of leaky building repairs, and skills shortages.
The accord could even save lives – as ministers said the stress faced by people working in the sector may be a factor behind the industry’s relatively high suicide rate.
‘‘The wellbeing of New Zealanders is intrinsically linked to safe, durable and affordable homes, buildings and infrastructure,’’ Ardern said.
The Government signalled the era of light-handed regulation was at an end and builders faced stronger building regulation.
Part of the accord would be aimed at ‘‘rebalancing risk’’ in the building sector. Auckland construction market.
Fletcher Construction also made huge losses on construction projects, including on the Christchurch Justice Precinct for the Ministry of Justice.
The accord would also lead to change on the much-criticised consenting system, which is blamed for New Zealand’s failure to build enough homes which forced home prices in Auckland to unaffordable levels.
Reidy said the accord group, which counted construction industry leaders among its members, provided a ‘‘platform for change’’.
‘‘The accord recognises that the way the construction industry, its clients and government have behaved in the past has created systemic problems that are having an impact on the New Zealand economy and the wellbeing of New Zealanders,’’ he said.
‘‘It commits those working in, and with, the industry to start treating each other differently, so we can replace the current adversarial culture with one based on respect, trust and shared responsibility.’’
He said: ‘‘We’re agreeing to uphold new standards of behaviour and to be held accountable if we don’t.’’
The construction industry is the New Zealand’s fourth-largest employer.
Reidy said construction employed 250,000 people and accounted for 7 per cent of GDP, contributing nearly $15 billion to the economy in 2017, a figure expected to reach $41b in 2023.
He said the previous industry, clients and government approaches had led to systemic problems like a focus on lowest cost over quality, uncertainty about the pipeline of upcoming work, and a culture of shifting risk rather than managing it.
‘‘These and other problems played out in things like construction company collapses, problems with building quality and skills shortages. They left individuals within the industry struggling to cope with the pressure, and likely contributed to the relatively high rates of suicide and injury in construction,’’ Reidy said.
‘‘New Zealand is not alone in having these problems.
‘‘These are big issues in the construction industry globally.’’
The Labour-led government won power promising more affordable homes.
It is in the process of establishing a New Zealand Infrastructure Commission, to encourage long-term planning.
Auckland mayor Phil Goff said the accord had ‘‘picked up’’ on recommendations from his Mayoral Housing Taskforce.
The deregulation of the building sector led to the nationwide leaky building scandal, which left tens of thousands of households facing huge bills to fix their homes, and defective apartments.
1970s: Technology innovation starts putting pressure on traditional building regulation.
1987: The Building Performance Guarantee Corporation was decommissioned. It ended the government’s stake in ensuring sub-par homes were not built.
1988: Ministry of Works and Construction was disestablished, reducing the importance of government engineers in managing the construction industry.
1992: The Building Industry Act 1991 was introduced. It set ‘‘performance criteria’’, freeing builders to use any technology they liked. The act said the ‘‘cladding’’ of a house must last just 15 years, and the structure 50.
1990s: Light-handed regulation meant little oversight for builders and developers.