Calls for royal commission into high-rise construction industry

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By Leith van Onselen

Since the beginning of this year, MB has lobbied for a royal commission into building regulations and standards, as well as the development industry, following the flammable cladding debacle and the discovery of widespread defects across Australia’s high-rise.

Yesterday, we received support from Advocate group, Builders Collective of AustraliaBuilders Collective of Australia, which has written to Prime Minister Scott Morrison urging a broad-based royal commission following “appalling failures within Australia’s residential construction sector”. Advocacy group Owners Corporation Network of Australia has also backed a royal commission. From The Canberra Times:

“Conflicts of interest, poor oversight from regulating bodies, and seeming indifference from governments ensure that regulations, standards, and expectations are not being met,” said Mr [Phil] Dwyer [from Builders Collective of Australia].

Stephen Goddard, solicitor and the chairman of advocacy group Owners Corporation Network of Australia, said he backed a royal commission… Goddard said deregulation and a lack of accountability from designers, engineers, architects and builders had resulted in a “loss of public confidence” in strata living and purchasing new apartments off the plan.

“If you know you have an 80 per cent chance of buying into a defective building, why would buy off the plan especially if neither the builder or developer owes you duty of care?,” he said.

The proliferation of poorly-built and flammable high-rise across Australia’s cities has created major problems that could take a decade and many billions of dollars to resolve.

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Only a warts-and-all royal commission would shine a spot light on the systemic issues, finger those responsible, and help prevent a reoccurrence in the future.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.