Residential Building Insurance (RBI)

The Residential Building Consumer Package

The full details of the package are outlined in the following documents:

• Guide for Building and Renovating in the Northern Territory
• Bill 1 - Building Amendment (Registration and other matters) Bill 2011
• Explanatory Statement for Bill 1
• Consultation Draft of Regulations for Bill 1
• Bill 2 - Building Amendment (Residential Building Consumer Protection) Bill 2011
• Explanatory Statement for Bill 2
• Overview Document of possible Regulations for Bill 2
• Minister’s second reading speech – delivered on 23 November 2011

 

Residential Building Consumer Package

In December 2010, the Territory Government tabled a Consultation Draft Bill to amend the Building Act to provide for a proposed residential building consumer protection package. Government reviewed the package after receiving submissions from industry. Following that process, Government is proposing some changes including commencing the package in two stages. Comments are now sought on two related bills that have been drafted to provide protection for consumers of residential building work.

On 23 November 2011, the Territory Government introduced in the Legislative Assembly the two Bills to amend the Building Act, and tabled a consultation draft of Regulations for Bill 1, and an outline document of possible regulations for Bill 2. Both Bills form a package that provides for consumer protection in the residential building market. In addition to the two Bills, a consumer guide has been developed, which will be published at the beginning of December 2011 on the Building Advisory Services homepage.

Key elements of Bill 1 titled ‘Building Amendment (Registration and other matters) Bill 2011’ include:

• a strengthening of the existing financial requirements for registration;
• legislative provision for the Regulations to prescribe requirements for progress payments; and,
• ‘housekeeping’ matters.

Key elements of the consultation draft of amendments to the Building Regulations titled ‘Building Amendment (Financial Assets, Residential Building Contracts and Other Matters) Regulations 2012’ include:

• Requirement for $50,000 as the financial assets for registration as a building contractor (must be maintained during the period of registration); and,
• Residential building contracts must specify the percentage of work payable on completion of each stage of building work and both the description of the stages, and the percentage for each stage is prescribed, unless parties agree to vary the stages in the approved form.

Key elements of Bill 2 titled ‘Building Amendment (Residential Building Consumer Protection) Bill 2011’ include:

• mandatory, last resort, residential building cover (insurance or insurance like cover);
• consumer guarantees; and
• a dispute resolution process (may be accessed where no residential building cover trigger has occurred)

The residential building cover is a reference to residential building insurance or cover through a fidelity fund scheme and will be required in place of the Home Building Certification Fund cover. The HBCF will be wound up on commencement of this Bill.

The Bills are to commence at separate stages. It is proposed that Bill 1 could commence in the near future, and Bill 2 could commence when residential building cover providers are able to offer the products.

The package is most relevant to both consumers and registered builders who participate in the residential building market. The package was developed after consultation with the wider community and industry from 2009 which was managed by the Building Industry Representative Group (BIRG).

The opportunity is now given to the community and the wider industry to have further input.

 

***You are invited to comment on the package by 15th February 2012***

 

 

Information Sessions

An information session was held on 1 December 2011 at the Master Builders Association in Darwin.

The presentation and handout provided at the information session may be accessed here:

Handout - Residential Building Consumer Package

As referred to in the handout document above, a standards and tolerances guide may be developed to assist in the resolution of disputes about what is considered ‘workmanlike’ building work. Victoria has published such a document, which may be accessed at the Victorian Building Commission website through the following link: 

Victorian Standards and Tolerances Guide (2007)

Housing Industry Association (HIA) also produce a guide to materials and workmanship for residential building work. The guide is offered for sale through HIA, and accordingly a link may not be provided. For further information about the guide, it is suggested that HIA be contacted directly.

It is proposed that any guide developed for the Northern Territory could be modelled on those or similar documents, in consultation with industry and consumers, and having regard to the Northern Territory environment.

Have Your Say

How to Make a Submission

The Territory Government is seeking comments on the proposed package from all interested parties by 15 February 2012.

You can make your submission by either:

• emailing to rbi@nt.gov.au, or
  
  
• Posting to:

  Senior Policy Officer
  Building Advisory Services Branch
  Department of Lands and Planning
  GPO Box 1680, Darwin   NT   0801

What happens next?

Your submissions will be used to further develop the Bills and the regulations that accompany the Bills.

The Bills are expected to be debated in the Legislative Assembly in February 2012.

Further Information

If you require further information please call Building Advisory Services Branch on 8999 8961.