This article is from the Australian Property Journal archive
THE Victorian government is delivering a package of reforms after the liquidation of Porter Davis revealed builders were failing to take out required insurance when accepting deposits.
The reforms for the construction industry, are being brought through in an effort to provide stronger protections to Victorians building or renovating their homes.
The state government recently offered support to customers impacted by the liquidation of Porter Davis Homes, via payments for those who were left without insurance through no fault of their own.
Porter Davis Homes, who collapsed at the end of May with 1,500 homes under construction in Victoria and 200 in Queensland, were found to have not taken out domestic building insurance with the state’s Victorian Managed Insurance Authority.
Victorian construction firm, Nostra Property Group, has committed to finish building 375 townhouses that were left abandoned following the collapse.
The government is now set to reform the Domestic Building Contracts Act 1995, while strengthening domestic building insurance requirements.
“These reforms are part of a comprehensive review to modernise Victoria’s building system, delivering better protection for Victorians building a home, while providing clarity to the building industry,” said Daniel Andrews, premier.
The reforms will see Victoria’s building regulators given more powers to monitor whether builders are meeting their obligations under the law to take out domestic building insurance prior to taking a deposit.
Failing to comply with these requirements will also be met with new tougher penalties.
The Victorian Building Authority (VBA) will also audit builders’ collection of deposits and purchase of domestic building insurance.
With Anna Cronin appointed by the board as the new CEO, following the resignation of the former VBA CEO Sue Eddy due the iPhone inspection scandal.
The reforms will also enable the review of the role of all regulators and improve the information provided to consumers about a builder’s obligation to take out domestic building insurance.
“The building sector is the backbone of our economy – we’re ensuring Victorians can have faith in the construction firms who build their homes, protecting their hard-earned savings,” said Sonya Kilkenny, minister for planning.
The Victorian government is currently delivering on foundational recommendations of the Building System Review, by establishing a Building Monitor to represent consumer interests, as well as widening the range of building industry participants who need to be registered and enhancing the oversight of building surveyors.
