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Focus: Uncertain times ahead – the Queensland Building Services Authority no longer!

20 June 2013

In brief: The Queensland Government recently launched its 'Ten Point Action Plan' which it proposes will restructure the regulation of Queenland's construction industry. As part of that process, the Queensland Building Services Authority will be replaced by the Queensland Building and Construction Commission. Partner Ren Niemann and Lawyer Goran Gelic report on this development and its implications.

How does it affect you?

  • There are no immediate changes to building law compliance obligations. Until the extent of the changes and their commencement are known, it is 'business as usual'.
  • All participants in the construction, energy and resource sectors in Queensland will need to carefully monitor this space. Some of the changes, if implemented in their current form, could have a significant impact on the regulatory framework.

What will happen and when?

In response to the recommendations from the Inquiry into the Operation and Performance of the Queensland Building Services Authority 2012 undertaken by the Transport, Housing and Local Government Committee, the Queensland Government has issued the Ten Point Action Plan for re-structuring the regulation of the Queensland construction industry. It is proposed the Queensland Building and Construction Commission (the QBCC) will be responsible for giving effect to this plan. The changes proposed, together with their timeframe, are set out below.

Timeframe for commencement Relevant 'action'

Immediate changes (expected to commence end of 2013)

  • Replace the Queensland Building Services Authority (the BSA) with the QBCC.
  • Establish an appropriate commission structure with functional business units (eg licensing) headed by their own general managers.

As soon as possible changes

  • Establish appropriate mechanisms of review. It is proposed that the QBCC will establish an internal review unit and procedures for review of insurance decisions and homeowner complaints to reduce the number of applications for review being made to QCAT.
  • Develop an improved suite of domestic building contracts (with a view to providing a more fair and equitable base for consumers and licensees).
  • Review the current system of licensing and compliance (particularly the difficulty with section 42 of the Queensland Building Services Authority Act 1991 (Qld) (the QBSA Act).
  • Develop improved education and training for home owners and consumers.

Progressive changes (subject to industry consultation). It is anticipated that these changes may take up to 12 months after the appointment of the QBCC.

  • In conjunction with the current industry review of the Building & Construction Industry Payments Act 2004 (Qld), consider the development and implementation of a rapid domestic adjudication model to fast track building disputes with mandated response timelines.
  • Retain the Queensland Home Warranty Scheme but review the scheme to provide greater definition and clarity.
  • Review the role of private certifier with emphasis on probity, conflict of interest, quality and appropriate penalty regimes for failure to perform.
  • Expand the licensing role of the new QBCC.

Commentary

The introduction of the QBCC to replace the BSA is the most significant change to the industry regulator since its inception some 22 years ago. Many of the proposed functions of the QBCC will be significantly different to that of BSA. The QBCC, for example, will have a stronger focus on licensing, certification and dispute avoidance and management.

One of the key changes flowing from the Ten Point Action Plan are the proposed amendments to s42 of the QBSA Act. It is proposed that s42 will be revised to make it clear that there will be no breach of the Act if the 'building work' is carried out by an appropriately licensed builder (this is contrary to the current position which requires a company to be licensed even though the company may contract with a registered building company to perform the 'building work'). The Government has acknowledged that the current approach to s42 may at times lead to unintended consequences.

The Queensland Government is already starting to give effect to the Ten Point Action Plan. Recently, the Queensland Government introduced the Queensland Building Services Authority Amendment Bill 2013 (Qld) which aims to give effect to the 'immediate' changes.

All participants in the construction, energy and resources sectors in Queensland will be, to some extent, affected by the proposed changes. Industry participants will need to be familiar with the proposed changes and ensure they are in a position to appropriately respond to them. That said, until we fully know the precise nature of the changes and their commencement, it is 'business as usual' for the time being. This is definitely a space to monitor carefully.

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