Why Councils Are Risk Averse In Building Processes

So this one is a little different, it’s defending councils against the allegations that they have ensnarled building processes in red tape. Anecdotally you can hear many concerns over what it costs to build a house or some commercial premises these days, and especially over the consents process with a local council and the fees they charge. Once upon a time there was not too much issue with building consents. But the problem is that a series of bad decisions were taken by central government to change the Building Act in various eras to loosen up the controls on various building processes. These include:

  • Building Act 2004 did not mandate a policy on earthquake prone (heritage) buildings. The result of this was the very weak policy Christchurch City Council had that let the dangerous buildings in the city continue to operate “virtually indefinitely” in the sense that it is not inaccurate to suggest that after the expiry of the very long repair terms, the council of the day would likely have provided for new extended terms, or in other words indefinite deferral of any strengthening requirements. In actuality, there was no need to have any policy at all. This Act was passed by the Labour Government to pander to the heritage lobby and was what led to significant deaths in dangerous heritage buildings in the 2011 Christchurch earthquake but it is difficult to know where the blame for the collapse of the CTV and PWC buildings can be sheeted home to, or for the lack of recognition of liquefaction risks on land over many decades.
  • Building Act 1991 changed the building controls from a prescriptive regime to one that was self-regulated. The apprentice training system was also dropped (source:Wikipedia).

The outcome certainly in the case of leaky homes has been that Councils have been forced to shoulder a percentage of the payouts mandated under the settlement package the government offered. Building companies were able to walk away from their responsibilities due to the extremely convenient mechanism of the Companies Act permitting them to shut down soon after completing the construction works. And to add to that, court action by disgruntled homeowners has further sheeted home liability to Councils whilst leaving construction companies and their principals free to walk away without bearing any of the remediation cost. This is the National Party way of socialising the costs and privatising the benefits, or corporate welfare. The use of certain building materials has also been a problem with a number of court cases brought against certain manufacturers.

What we can’t ignore is simple and obvious: if councils are going to end up being made financially liable for the failure to ensure these houses were constructed according to “code” then it is a natural reaction for them to have become risk-averse and to have responded by tying up construction processes in red tape. Just remember next time you complain about this that as a ratepayer you are potentially going to be funding ongoing settlements of existing leaky homes claims made against your local council. The real question is why, the National Government having bailed out Christchurch City Council over the massive damage to red-zone land with the settlement offers for homeowners, it could not actually accept liability for creating the leaky homes crisis. As long as the blame has to some extent unfairly been transferred to local bodies, whilst there is no remedy for shoddy construction work, the reaction of territorial councils to ensure that all processes are structured to reduce their risk exposure is an entirely understandable one.