Building Amendment (Cladding Rectification) Bill 2019

Ms VAGHELA (Western Metropolitan) (15:47:22): I rise to speak on the Building Amendment (Cladding Rectification) Bill 2019. The use of combustible cladding on Victorian buildings is a critical public safety issue, one that the government takes very seriously and is committed to rectifying. After the Lacrosse building fire in 2014 the government embarked on Australia’s first ever audit to identify buildings fitted with combustible cladding and assess their risk rating. In 2017 the government established the Victorian Cladding Taskforce. The task force was established to oversee the continuing audit of buildings to identify where cladding was used inappropriately, to propose options for rectification and to make recommendations to the government on how to improve compliance and enforcement of building regulations to better protect the health and safety of building occupants. The task force released an interim report in December 2017 and a final report in July 2019. One of its recommendations was for the government to take action to rectify buildings with high-risk cladding and to establish a dedicated cladding agency. The use of combustible cladding is a complex issue facing major cities around the world. There are many home owners in Victoria grappling with the cost and complexity of removing this cladding. To date, the Victorian government has led the nation by inspecting more than 2000 buildings to better understand the scale of the problem and where there are key regulatory gaps. On 16 July 2019 the Premier, Daniel Andrews, and the Minister for Planning, Richard Wynne, announced the establishment of the cladding rectification program to support owners to fix buildings with combustible cladding in Victoria. The program includes a series of measures in response to the issue of high-risk combustible cladding, including a $600 million package to rectify the highest risk private residential buildings and a new agency, Cladding Safety Victoria, to oversee delivery of the rectification program. Cladding Safety Victoria will support owners corporations by providing advice, information, guidance and connections to appropriately registered and qualified practitioners to carry out cladding rectification work. It will also fund rectification works on hundreds of buildings found to have high-risk cladding to ensure that they are safe to occupy over the long term. The Victorian government is announcing new measures to ensure that dodgy builders, surveyors, designers and other industry practitioners are held accountable to owners of apartments covered in combustible cladding. The bill implements a targeted increase to the building permit levy to help fund the cladding rectification program. We want to make sure that the wrongdoers get punished for their dodgy behaviour. The bill will give the Victorian government the power to sue dodgy builders on behalf of owners or owners corporations who access rectification assistance. The government will take action against wrongdoers on a case-by-case basis to aid the recovery of the cost of the rectification program. Where builders or building practitioners have done the wrong thing, it is only fair that they contribute to the cost of fixing their mistakes. We do not want to see more mistakes made. We do not want to see more Victorians put at risk. The Victorian government and Cladding Safety Victoria are working to deliver on this commitment. Victorians expect that those who created the current problem with combustible cladding will contribute to fixing it. Victorians expect their government to take the necessary action, so we must make sure that a legal action can be taken. Each building earmarked for rectification is dealt with one at a time, with the primary engagement being through the owners corporations on behalf of the owners. Given the state is taking on the cost of rectification, there will be no reason for an owner to seek to take legal action against a building practitioner in relation to combustible cladding where the rectification of the owner’s building is to be funded through Cladding Safety Victoria. We believe that owners should not have to deal with the cost and stress that court action can mean, so we will initiate any legal action on their behalf. This will not stop owners from taking legal action against practitioners in relation to any other defects in their building that they are aware of. The government, acting on behalf of owners, will be dealing primarily with owners corporations. Fifteen buildings have been chosen by the government to be the first to be rectified based on their risk rating and to incorporate a variety of building types. These first 15 projects will enable Cladding Safety Victoria to test the processes it has put in place and then scale up to the next tranche of buildings. Before the end of the year Cladding Safety Victoria will notify the owners corporations of the next 150 buildings that will come into the program in 2020. Cladding Safety Victoria chief executive Dan O’Brien and his team have met with representatives of the owners corporations of all 15 buildings that will be first to be rectified. The owners of some buildings have designs completed, one is at the Building Appeals Board for approval while others are not as advanced. Construction works to rectify these buildings will begin after the design is approved and builders are appointed through an appropriate tender process. Cladding Safety Victoria has been working closely with owners corporations of the first 15 buildings for a number of weeks, so the process has well and truly started. This is the first time anywhere in the world that a government has sought to put a systematic response in place to this highly complex problem. It is important to remember we are working with the owners of private apartment buildings to reduce the risk to life—not just to them but to tenants, visitors and the first responders in the event of a fire. In cases where dangerous cladding is found to be a risk, the Victorian Building Authority (VBA) issues orders for it to be fixed and can ban people from occupying the building. Having flammable cladding on your apartment building is concerning and stressful. That is why the VBA works with councils and owners corporations to make sure all owners and residents are aware. People who own and live in these buildings are told when this cladding has been found. Anyone wanting to know the status of their building or a building they are considering buying or moving into can contact the Victorian Building Authority. The Victorian government is supporting owners to fix the buildings with combustible cladding in our state through Cladding Safety Victoria. Cladding Safety Victoria funds work based on the recommendations of an independent panel of fire and building experts. It helps owners and owners corporations of apartment buildings in need of rectification works to fix their buildings. The government’s decision to establish Cladding Safety Victoria was on the advice of the Victorian Cladding Taskforce. The task force has worked with the VBA, the Department of Environment, Land, Water and Planning, local governments, fire authorities and other stakeholders to identify buildings with combustible cladding and assess each building’s fire risk. Cladding Safety Victoria provides guidance, support and funding to assist building owners and owners corporations to rectify buildings. This includes funding owners corporations to engage project managers and other consultants and builders to fix buildings. The buildings are prioritised based on risk, as assessed by the independent expert panels made up of a fire engineer, a building surveyor and a member of the fire services. The establishment of Cladding Safety Victoria is a world-first initiative for this international problem and will begin with a process to rectify combustible cladding on 15 buildings. When a building has been audited by the VBA, it will be referred to Cladding Safety Victoria for rectification if necessary. Once a building is referred to Cladding Safety Victoria a community liaison officer will work with the owners and the owners corporation to facilitate the rectification process, including any application for funding. These things take time. Every owners corporation is being contacted. Information will also be available on the Cladding Safety Victoria website. Each building is unique, and not all buildings will require full removal of cladding. Cladding Safety Victoria works closely with owners corporations to determine the most appropriate solution for each building. Factors which will help determine the amount of funding provided include the cost-effectiveness and suitability of the proposed rectification as well as the scope of works. The amount of funding will be determined by the cost of works that need to be completed. The aim of rectification is to reduce the level of risk to occupants to an acceptable level, which includes bringing the cladding to compliance with the National Construction Code. Owners of buildings requiring cladding rectification under the cladding rectification program will not be asked to contribute to the cost, unless they are seeking a solution above and beyond that required by Cladding Safety Victoria. Any other work carried out at the time of cladding removal must be paid for by the owner. Cladding Safety Victoria will assess the application to determine whether additional funds may be granted. The VBA has inspected more than 2000 buildings and found that approximately 800 have some level of increased risk from combustible cladding. The audit process is ongoing, and the VBA expects to find more buildings that need attention. Some buildings may need more work than others; some will not need the cladding removed at all because the fire risk is low. While 800 buildings have been identified as having various levels of cladding, not all buildings will require rectification works due to varying levels of risk. We are funding rectifications through a targeted increase to the building permit levy, starting with works valued at more than $800 000. Raising the building levy should not impact the property market. We have modelled the potential impact of an increase to the levy on consumers and have designed the increase to minimise the impact on people purchasing homes in Victoria. This problem has been 20 years in the making. It has put lives at risk and, as a responsible government, we believe that we need to act. Cladding Safety Victoria is not a regulatory body. Its job is to fund works and enable owners to rectify buildings with combustible cladding. It will also educate people on living safely around cladding. In addition to the cladding rectification works, the government intends to undertake a full review of the Building Act 1993. A program of reforms will ensure the legislative and regulatory frameworks are effective, responsive, risk based and reflect contemporary safety and community expectations. Victoria is leading the country in this work, and we will be working with our federal colleagues to ensure that the nationwide implications of building reform in Victoria are addressed. In March 2018 Victoria was the first state to decisively limit the use of combustible products on buildings. Victoria is currently working through the Building Ministers’ Forum to investigate the implementation of a national ban on the supply and importation of combustible cladding. The statewide cladding audit has been funded to 2023 to continue to find, inspect and assess buildings. We will keep going until we stop finding risky buildings. The use of combustible cladding in multistorey buildings is a global issue. Here in Victoria we have taken decisive action over recent years that has culminated in the establishment of Cladding Safety Victoria. The state’s priority is to fix the combustible cladding issue in Victoria and improve the safety of building occupants. Victoria is leading the world’s governments in addressing this important public safety problem. I commend the bill to the house.