Building consent regime set for overhaul: Penk

Wednesday, 20 March 2024

Building consenting authorities will be required to tell central government how long it takes them to issue building consent and code compliance certificates as a potential first step in an overhaul of the mostly council-based building consents system, Building and Construction Minister Chris Penk will announce today.

Penk, in an interview with The Post, said the new requirement will give help to the Government to sort anecdotes of consenting horror from the facts. He also indicated he had his eye on liberalising the building products markets.

“We're asking - or requiring, rather - building consent authorities to provide data in relation to quarter one for this year, initially, of the amount of time it takes to process and approve a building consent. Likewise, code compliance certificate and then the median time for each of those sets of data,” Penk said.

“Building in New Zealand needs to be cheaper and faster than it's been so far. We've got people, products and processes that we need to look to reform to ensure that we have building done much more affordably including in relation to housing supply,” he said.

“A crucial element in that is the process around building consents.”

Stats NZ data shows that Wellington City issued 77 consents for new buildings in the last quarter of 2023. That compares to 3408 in Auckland, 1278 in Christchurch, and 256 in Hamilton. Next door to Wellington City, Hutt City issued 186 in the same period, while Porirua issued two.

Property developer Kevin Melville said building consents were an ongoing battle and made it tough to do business. “Something has to change.”

He said lengthy delays when a site was ready to build had led to cost escalations. “Every 10 minutes something gets repriced, it goes up $1 million.”

Ten years ago it would take only 12 days to get a building consent, but now Melville said he expected a wait of at least eight months. That was well beyond the statutory timeframe of 20 working days - approximately one month.

The slow building consent process in Lower Hutt had taken him to “breaking point” and he said he was considering focusing on Upper Hutt and Porirua where the wait was a lot shorter.

Hutt City Council environment director Alison Geddes said the average processing time for all consents was now 20 working days and the council had “worked hard to ensure building consents are dealt with in a timely manner”. The backlog of building consents was now clear, she said.

Sharing the data is the first step in a bigger reform Penk said he wants to get stuck into during the second quarter of this year - including a look at the entire consenting regime which is dominated by local councils.

“At the moment that the system exists whereby councils are building consent authorities … we're definitely looking at reforming what that looks like. But in the meantime, we don't have a good handle on how the system's performing at the moment. So we need the data to back that up.”

“We need to understand which of the councils are operating most efficiently, there might be wins and lessons that we can learn from those to apply to the others.”

Penk said there would be no “particular consequence” if councils didn’t stump up the data, but even that might unearth constraints that councils and consenting authorities are facing.

The Government does not appear to be set on a new model for consenting, but Penk expects there will be considerable variations across New Zealand and that discrete councils consenting building and issuing code compliance may not be the best model.

“It could be a matter of making a sort of a regional model or even a national model,” he said. “We need to understand which of the councils are operating most efficiently, there might be wins and lessons that we can learn from those to apply to the others.”

Another Wellington builder who asked not to be named for fear of repercussions from the council told The Post that said building consents were meant to take 20 working days at the most but the Wellington City Council regularly came back on the 20th working day asking for new information, and extending the timeframe.

At the same time, Penk is also looking under the hood of the building supplies industry to liberalise a supply chain that many think - going back to a big Productivity Commission report in 2012 - has been gummed up and is slow to get new products to market.

Penk, however was keen not to put the boot into councils, noting that they hold joint and several liability over consenting decisions and could end up holding the bag in the event something goes wrong - which could be driving conservative consenting behaviour.

“So they are risk averse, therefore, they are slower and that's understandable and even quite commendable as far as that goes. But we are looking at, you know, a system that doesn't rely on individual councils carrying the can for the whole lot.”

The other issue that Penk signalled movement on was a National party campaign promise to mandate building materials already approved in Australia for use in New Zealand.

Standing in the long shadow of leaky buildings and other lax building regulation over time, Penk wished to emphasise that: “This isn't about lowering standards.

“It's actually about providing more different options for equivalent or higher standard and then you unlock the benefits of the economy of scale.

“For example, if there's an Australian product that's used and the Australian design or the Australian Standard is at least as robust as New Zealand when we're not going to lose out from that, but means we're going to have more options.”

But he said more work would need to be done to make it all a reality.

“The devil will be in the detail about which jurisdictions and which standards and we'll work through that, but that's basically the direction we want to move in.”