An independent review that uncovered serious failings in the way the Victorian Building Authority (VBA) handled complaints from homeowners who had been in financial distress for years because of defective homes was the final straw for the state government caused it to overflow.
The quick reaction was to announce that the VBA would be replaced by a new, more powerful regulator with greater powers to tackle substandard construction.
The Victorian Building & Plumbing Commission (VBPC) will be given tough new legislative powers to protect homeowners and condominium associations from contractors and plumbers carrying out substandard work.
The VBPC will handle all aspects of building quality control, including regulation, insurance and dispute resolution, under a single agency.
Currently, the VBA could only order builders to repair substandard work before residents moved in.
However, under the new rules, the VBPC will be able to direct builders and plumbers to repair works not only before move-in day, but also beyond. The state government will work with industry to determine the eligible period.
New powers will also allow the VBPC to prevent the sale of apartments in new builds with serious defects, as well as increased reporting requirements before signing certificates of occupancy for new builds.
The new agency will be staffed with new staff on the ground, with the number of frontline auditors and inspectors increasing by 50 percent as part of a $63.3 million investment in this year's budget.
The VBPC will also be tasked with leading an inspection drive, including a crackdown on unregistered construction and plumbing works.
The state government's press release announcing the new VBPC said homeowners will have better access to insurance if something goes wrong, potentially reducing the need for complex and costly legal claims against builders who do the wrong thing.
Home buyers will also receive stronger financial protection as developers will be required to pay a deposit to cover the cost of repairing defective work on buildings over three storeys. The new bond will be the first step in introducing a new ten-year insurance policy for multifamily properties. The next steps will be developed in consultation with an industry working group.
It remains to be seen whether the new VBPC will be anything other than simply the old Victorian Building Authority in new clothes and clothing.
However, any improvement to the current structure is an overall improvement and will result in better outcomes for homeowners. •
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