Red tape and high costs are strangling the building industry, new survey reveals

Wednesday, 1 May 2019

In a new survey 80 per cent of building industry respondents said red tape was the biggest obstacle to consenting and building delays for the construction industry.

Red tape is strangling the building industry, apprentices need to be better trained and monopolies control the cost of materials, a new survey has revealed.

A March 2019 survey by Construction Marketing Services and supported by the Registered Master Builders Federation has found that red tape was a top problem for the construction industry.

Nearly 500 responses were received from builders, tradesmen, architects. designers and draughtsmen to the survey.

Two other key issues were the high cost and shortage of skilled labour and the cost and quality of building materials.

Some 80 per cent of respondents said red tape was the biggest obstacle to consenting and building delays when asked about key issues facing the industry.

The Government has announced the biggest overhaul of the Building Act in years with the construction industry facing higher penalties for poor performance.

* Construction Accord: Honeyed words or will i bring real change?

* Changes proposed to Building Act mean tougher consequences for failings**

Other key issues facing the industry identified by 70 per cent and more of respondents were the high cost and shortage of skilled labour and the cost and quality of building materials.

The survey results have been made public as the Government commits to an industry accord with the construction sector following a wave of problems including high-profile building company collapses, poor-quality builds which led to households facing billions of dollars of leaky building repairs, and skills shortages.

It has also announced the biggest overhaul of the Building Act 2004 in years, aimed at the construction sector delivering safer more durable buildings and performing to a higher standard - and facing much tougher penalties if they do not.

The survey respondents said better training of apprentices was needed as well as an understanding of where the skills gaps were.

'The survey suggests that the new Government/construction industry accord needs to urgently address local and central Government red tape as a priority.' Construction Marketing Services general manager Ian Watt said.

'The Construction Marketing Services network is a very good cross section of the industry, so we believe this survey speaks volumes about how frustrated the industry has become,' he said.

To make housing more affordable 70 per cent of respondents pointed to the cost of materials as a key problem and 69 per cent said the consenting and approvals process needed to be reviewed.

Monopolies in the sector controlled the price of materials and that needed to be addressed, respondents said.

Nearly half of the respondents said prefabrication and modular housing had a part to play in tackling housing shortages and affordability but prefabricated housing needed to be more cost-effective and better quality.

New Zealand's smallness might hinder investment because a prefabrication business required a lot of capital.

Production substitution, poor materials and shoddy building practices were also a big concern for 75 per cent of respondents.

To raise the quality of building almost 60 per cent said more education was needed about the value of doing more than meeting minimum standards, minimum standards should be raised and more emphasis should be placed on industry product appraisals.