Kāinga Ora seeks power to approve own building consents

Wednesday, 30 September 2020

State housing provider Kāinga Ora is setting up an arm to issue its own building consents.

The Government's state housing building machine is on a path to issuing its own building consents to speed up its building programme.

Kāinga Ora– which emerged from the merger of Housing New Zealand, KiwiBuild and development subsidiary HLC last year – has confirmed it plans to establish a building consent authority.

Called Consentium, the authority would be independent from Kāinga Ora’s state house building arm, Construction and Innovation, which aims to build 19,000 homes over the next decade.

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Nick Hill says getting permission to issue building consents is an ‘’onerous’’ process.

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Pressure from Wainuiomata residents has forced Kainga Ora to change plans for 35 transitional houses in Wood St to a mixture of state and transitional housing.

But the idea of a non-council entity issuing building consents is making councils nervous about issues such as liability.

Kāinga Ora’s national building consent authority manager Anna McCrossan said the power to issue consents would be a first for Kāinga Ora or its predecessor.

''It’s about how we can best manage the end-to-end consenting process nationally to meet Kāinga Ora’s ambitious development programme, while also upgrading a substantial number of existing state homes.''

McCrossan said authorities could not process consents beyond their scope. ''Our scope includes state house building consents of up to four levels.''

Under the Building Act, non-council bodies can apply for the right to issue building consents, but it's believed few if any private companies have gone through the strict accreditation process to date.

Independent accreditation body IANZ and the Ministry of Business, Innovation and Employment both had to be satisfied that there was appropriate governance, policies, and systems in place to avoid any conflicts of interest, McCrossan said.

Lawyer Nathan Speir says councils are uncertain about what Consentium will mean for them.

Consentium would be overseen by a regulatory compliance sub-committee, she added.

BOINZ, the Building Officials Institute of New Zealand, agreed it was difficult for entities outside councils to get authority to issue building consents.

''The process is onerous, and the support requirements in terms of insurance to cover their liabilities is actually quite high,'' the institute's chief executive, Nick Hill, said.

''It would not be easy for someone to set it up without considerable financial backing.''

Hill said the liability issue was such that BOINZ would not support anything without the support of a strong quality programme in place.

To speed up the work, Kāinga Ora is also testing prefabricated building techniques such as this modular bathroom pod by Canterbury firm Concision.

''The issue you've got is for industry capture and price competition, a race to the bottom which affects quality, and therefore you have conformance and compliance issues.''

However, with New Zealand's leaky home disaster still fresh in the mind of the building industry, councils are not so sure.

New Zealand had independent building certifiers in the 1990s and 2000s, but after the true extent of the leaky building issue was revealed, the liability for consenting returned to councils, although they still contract out inspection work.

Laywer Nathan Speir of Rice Speir, a firm specialising in council matters, said there was disquiet among local authorities about Consentium’s implications.

''It's the uncertainty around it all. Building consents are a big component of a local authority's revenue stream. They're not looked at it like that because obviously there's liabilities that come with that too.

‘’But it's dollars that wouldn't be coming in if a central government agency is performing that role.''

However, the main issue lay around whether councils would still be liable.

''We've been through the leaky building crisis and … it ends up being the last person standing, the council and the ratepayers, when things go bad.

''So if a government agency comes in and starts issuing building consents and then Government changes and Consentium is no longer, what does that mean? Who picks up the tab in the event of a failed build?''

Kāinga Ora, meanwhile, is plugging on with the rollout of its massive building programme.

In March, the department was testing locally made modular bathrooms in a Canterbury factory, and in July, an extra $500m was released to retrofit 1500 state homes.

Last week the Government announced it would add another 360 state homes to Kāinga Ora’s stock in Christchurch, and in August it announced it was pumping $188m into wastewater and water networks in Auckland, to progress eight major state housing developments.

They include the Roskill Development, where a third of the 10,000 houses planned over the next 10-15 years will be state owned.

However, some of the projects have not always won local support. In Wainuiomata, resident feedback prompted the Crown housing agency to include state homes in a proposed block of 35 transitional houses.

And a 70-unit housing development in Hamilton’s Flagstaff suburb has been criticised after Kāinga Ora decided not to seek a publicly notified resource consent, citing costs and time delays. The state housing agency later scaled down the development.