Consent evaluation report: Part four

The Ministry of Business, Innovation and Employment (MBIE) has released its evaluation of the building consent system report. This is the last of four articles that explores its findings

The report was commissioned to understand how well the current consent system is aligned with its objectives and to explore the underlying causes of issues such as efficiency and effectiveness. 

Under Construction has reported widely on the consenting process, with builders highlighting issues across the country. 

However, MBIE refuted those claims in the executive summary of its report. 

“The system faces frequent criticism for being inefficient and unpredictable, adding additional costs and delays to building projects,” it stated. “However, there has been little robust evidence to support these claims and a lack of nationally consistent data about the consenting process.”

The report gathered evidence between March and July 2021. It carried out interviews, focus groups, surveys, building site visits, reviewed existing research and analysed the current consents process. MBIE received 291 survey responses, carried out 59 interviews, held five focus groups attended by 41 industry professionals, and visited sites in eight regions across New Zealand. 

This is the last of four articles that will explore problems in the building consent system, as discussed in the report.

Discussion of underlying causes

MBIE states it can’t attribute the problems within the building consent system to one underlying cause.

“Each of the themes of capacity, capability and behaviour may be linked to a web of potential underlying drivers.”

However, research was able to identify four categories that caused the underlying drivers of problems:

• Unprecedented demand on the building sector.
• Increasing complexity in building design and regulation.
• The devolved structure of the building consent system.
• Concerns about managing risk and liability.

“These drivers influence the way that people think about and undertake their roles in the building consent system, creating impacts on the capability, capacity and behaviours of the wider building workforce,” said MBIE.

As a result of those drivers, problems occur with the way the system operates and its ability to be efficient, predictable and effective.

The system is under incredible strain

The perception of the building industry as one that goes through boom-and-bust cycles encourages a reactive, short-term outlook at the expense of longer-term workforce investment and development, said the report.

A lack of workforce investment in building consent authorities (BCAs) and the sector has resulted in challenges in meeting capacity and capability requirements. The report highlights these problems as contributing to issues in the building consent system due to gaps in required skills and supervision, and suggests a lack of incentive to manage poor performance within the workforce also contributes to the problem.

Gaps in capability and oversight

Advances in methods of construction, environmental awareness and urban densification have led to buildings becoming increasingly complex to build and regulate. One consequence of this is the building industry’s increasingly specialised nature.

“Our fieldwork suggests that both the industry and the BCAs are facing challenges in keeping up with the capability and capacity to manage the increasingly complex nature of modern construction and its regulatory requirements,” stated MBIE.

Structural issues cause unpredictability

Each BCA has its own policies and procedures to manage the process of issuing a building consent. There are 67 BCAs, each with separate policies and resourcing.

While the report found that there were small differences between BCAs’ processes for consent applications, there were variations in the way that decisions were made. This is contributing to a sense of uncertainty and unpredictability for sector professionals.

Smaller BCAs also face issues accessing resources and expertise to perform efficiently and effectively.

Risk and liability concerns

Risk management is a serious obstacle on the path to a smooth consent system, said MBIE.

“The way that risk is managed within the building consent system is seen as one of the more significant drivers of behaviours that contribute to problems within the system and was a key focus of stakeholder feedback throughout the fieldwork.”

Because BCAs may be subject to claims that could result in financial liabilities should building work be found defective, they are perceived to be risk-averse.

This concern over potential liability appears to be influencing the way people carry out their role in the consenting process, especially regarding quality assurance. The report said: “This lack of consistent quality assurance only reinforces the need for BCAs to be more concerned about the potential for risk if they do not undertake their role with the appropriate level of caution, regardless of the quality of work the sector produces. 

“As BCAs become very cautious in their approach to decision-making, [they] issue high numbers of ‘Request For More Information’ to meet their thresholds for determining ‘reasonable grounds’.  This, in turn, disincentivises the sector from putting in sufficient effort up front. As a result, the system may benefit from some consideration of how to better balance responsibilities in the assurance process.”

A silver lining

Despite the issues raised above, and throughout this four-part series, there is evidence that the system is delivering buildings that are compliant with Building Code.

The report suggests that consideration should be given to balance the roles and responsibilities in the system, especially regarding quality assurance.

“This could contribute to a system that is more efficient, predictable and effective, and better able to achieve its wider objectives,” concluded the report.

Finally, a system that regularly collected and monitored building consent data across all BCAs was recommended to “improve understanding of the efficiency and consistency of the system while also identifying potential capability issues that may be contributing to RFIs or inspection failures”.