Government lets factories return to unplug building supplies bottleneck

Tuesday, 7 September 2021

Waikato’s Anthem Homes is one of many firms struggling to source plasterboard or cladding.

The Government has announced a rule change that should enable the release of critical building materials stuck in Auckland, to avoid the rest of the country running out of supplies.

Building and Construction Minister Poto Williams and Finance Minister Grant Robertson said a change would be made to the Health Order to enable selected manufacturers in Auckland to return to work over the next 48 hours.

MBIE will manage the process of eligible companies to ensure the work is being done safely under Level 4 rules, Williams said.

“The products must be a critical component of residential construction, there is limited supply and manufacturers must have health and safety measures in place to minimise the risk of Covid-19 transmission.

“Plasterboard, gypsum plaster, coated roofing steel and insulation meet this criteria.”

Thousands of construction sites are re-opening amid predictions that common building products could run out in just three days. (First published in September 2021)

* Builders returning to work face prospect of not being able to get materials

* Construction delays fears grow as 'perfect storm' intensifies

Robertson acknowledged that there was a developing supply chain issue as the country outside Auckland moved to Level 2 tonight.

Many builders returned to site under socially distant Level 3 rules a week ago, only to find that products were getting scarce because most building materials were unable to leave Auckland, where they are made or imported.

There were reports of Pink Batts, roofing materials, steel coil and gibraltar board running out around the country.

Even the country’s largest residential builder state housing builder, Kāinga Ora, which is in the middle of many large housing projects, said it was affected.

Kāinga Ora construction and innovation general manager Patrick Dougherty said the recent split in lockdown levels with Auckland had resulted in “a complex situation”.

“We are in the same position as the rest of the construction industry in New Zealand and are working through all avenues to continue or keep the delay to our construction plans to a minimum.”

Pink Batts is in short supply, along with paint, gibraltar board, steel coil and frame and trusses.

Coming off the back of existing shortages, construction industry players voiced alarm about the situation, particularly as it could leave partly-built houses open to the elements.

Julien Leys, chief executive of the Building Industry Federation, which represents suppliers, suggested the Government be given a list of the companies producing the most critical products.

“If we can at least say, these are the top 50 [building materials] that will make a difference, that would be progress.”

Without intervention, he said that by Friday most building suppliers in level 3 would have run out of building materials.

And even when the factories that made these materials were permitted to operate, he said it would take weeks for the supplies to flow downstream.

Some production lines took up to two days to warm up, and then a handful of days to leave the factory.

“But by the time it reaches a builder in, say Christchurch, or even Invercargill, that could be weeks,by the time it actually got into the distribution centre and then organising freight across Cook Strait.”

Fletcher Building, whose Tasman Insulation subsidiary makes Pink Batts, said it hoped to begin dispatching products to replenish stocks next Monday, after almost completely running out around the country. Its only factory is in Auckland.

Dean Kimpton, chairman of the Construction Sector Accord, said the difficulty lay in the criteria for deciding what was essential in the building industry.

Under level 4, the only services that were allowed to help the building sector were those connected to people's health and safety or nationally significant infrastructure.

“If you're building a house in Palmerston North and if they're running out of materials that only come from Auckland, that's not considered nationally significant infrastructure.”

In Hamilton, Anthem Homes director Douw Van der Merwe told Stuff the company had not been able to get any Gib board, which meant in some cases having to seek changes to the plans to use a substitute.

“We’ve been talking to clients about changing the designs or making amendments and that can mean going back to the council, extra resource and there are costs involved.”