LEAKY HOMES, Part 1: The myth of deregulated building

"The building codes of the democracies embody, of course, only what the previous generation knew, or thought they knew, about building...”- Frank Lloyd Wright

“If a detailed, factual study were made of all those instances in the history of … industry which have been used by the statists as an indictment of free enterprise and as an argument in favor of a government-controlled economy, it would be found that the actions blamed on businessmen were caused, necessitated, and made possible only by government intervention in business. The evils, popularly ascribed to big industrialists, were not the result of an unregulated industry, but of government power over industry. The villain in the picture was not the businessman, but the legislator, not free enterprise, but government controls.”
- Ayn Rand

THE LEAKY HOMES DEBACLE is costing everyone in the country dearly.  Homes full of mould and misery – builders, designers and contractors fearful of opening their letterbox for fear of a summons -- and “a bill that is likely to top $11.5 billion” to fix it all that is being picked up by ratepayers, by home-owners, and by everyone who’s  got a dollar in their pocket and anyone who ever visited a building site.

It’s a big problem, isn’t it – and a big problem needs a big villain.

The myth persists that the leading villain in the leaky homes debacle was the “light-handed regulation” introduced to the building industry in the early nineties by the National Government, which allowed “alternative solutions” to undermine good professional practice, and cowboy builders and unregistered designers to fly by night and rip off old ladies.

According to this myth, there was once a golden age in which kindly building inspectors and knowledgeable bureaucrats were everywhere, reining in the cowboys, prohibiting shonky practices and banning shoddy building systems – and who are now grasping the nettle to return things to sanity. 

Unfortunately for those who peddle the myth, nothing could be further from the truth. It's a fairy tale.

The fairy tale, however, is everywhere. Its latest appearance was on Leighton Smith’s morning show in the person of John Gray from the Home Owners and Buyers Association, where  he peddled the myth that this “light-handed regulation” is the cause of all the leaky-home misery, along with all the cowboy builders, designers and inspectors it let loose on unsuspecting home-owners.

Unfortunately for the headline writers and Mr Gray, it’s just not true.  In fact it’s almost one-hundred-and-eighty-degrees the opposite of the truth.  It’s a fairy tale erected out of whole cloth. 

The misery is certainly true,however – and it’s been killing good builders, good designers and unfortunate home-owners.  And let’s not downplay either the misery, or the good intentions of Mr Gray. But the cause of all that misery is not “light-handed regulation,” since that wasn’t the regime under which most of the damage was done then, it’s far from the regime in which the damage is still being done now, and in any case it doesn’t speak to the actual pathology of the problem: what actually allowed water into houses and let them rot.

I’ll talk about the physical causes tomorrow, and on Monday I’ll talk about how the “solutions” set up by government to “fix” the leaky homes problem have conspired instead to make things worse for everyone, including the regulators.  Today I’ll just talk about this myth of light-handed regulation.

FOR A START, JUST think about this: there was a much more light-handed regulatory regime in the early 1910s and 1920s, when most of the villas and bungalows were built for which people now pay huge money – even for “original” examples.  Things couldn’t be more light-handed then, but the disastrous systemic problems now being experienced weren’t in evidence then – not even for the many stucco (solid plaster) buildings like these two on the right still decorating some of our leafiest suburbs.

In fact, even in 1982 when I started building, a relatively light-handed regulatory regime was still in existence – even in those Muldoonist times. 

The ‘Bible’ on site was a document called NZ Standard 3604, which back then was about forty pages long; permits took around two weeks at most to process; council inspectors were seen on site around three times maximum – and the thing called a Code Compliance Certificate didn’t even exist. 

The first house I ever worked on, in the leafy suburb of Remuera as it happens, had just  two pages of plans (no details) and each time the inspector arrived it was to discover that my boss had changed something else from the drawings.  Inspector Dumbo eventually just told us to send him a sketch when we’d finished – if we could get around to it.  We never did. The house is still there, still solid.

I tell you that story not because it was unusual, but because it wasn’t. By the time I was building EIFS-clad houses in Mission Bay in 1987, things were no different (and I have to report, these were EIFS-clad houses that had no problems with leaking cladding).  But things were about to change.
Enter the bureaucrats. 

THE BUREAUCRAT WHO BEARS the greatest guilt is a know-nothing called Bill Porteous whose agitation for more building regulation and an “Integrated Building Code” leveraged him into the job as head of the new bureaucracy set up to oversee the building industry, the Building Industry Authority. 

I say “a know-nothing,” and I say that from personal experience, since Porteous was inflicted on me as an alleged construction lecturer in my two years at the Wellington Architecture School in the mid-eighties – where I quickly discovered that what Porteous knew about construction could be written on a very small postcard (a postcard which needed to be folded until it was all sharp corners and stuffed up his arse) and was awfully excited about the idea of an “integrated national building code.”

As you can imagine, we didn’t get on.

That's a sample on the right of just some of the paperwork that accompanied the 'deregulation' of the nineties. The new bureaucracy was of a similar size.

Now if that’s deregulation, then you can call me Norwegian and ship me to Oslo.

Promoted from his job lecturing budding architects how not to build a house, Porteous’s new bureaucracy quickly set about regulating, ahem, “integrating” the building industry, giving increased powers of oversight to councils, giving increasing authority to the bunch of bureaucrats in Porirua known as the Building Research Association of NZ (BRANZ), and putting his new integrated “performance-based” building code into action.

I say “performance-based” building code since that’s what it said right there on the label, but in reality the new code was about as “performance-based” as its near-identical twin, the Resource Management Act – and just as heavy-handed.

Want to build a balustrade?  The new Building Code told you (and still does) how you’re allowed to do it, right down to the size of bolts and the spacing of balusters. Want to specify the timber you’re going to build your house with? The standards specified under the new Building Code told you (and still do) what timber you’re allowed to use where.  Want to install a cladding system? The new Building Code told you (and still does) what hoops you have to jump through before you’re allowed to. 

One of those hoops was (and still is) that the system, item or building material had to have obtained approval from those bureaucrats out at Porirua.  Those bureaucrats at BRANZ.  The next hoop to jump was (and still is) obtaining a building consent from your council -- which now routinely take months rather than weeks to process, and can even take months just to be allowed to submit a consent. And the next hoop was (and still is) to endure an increased number of building inspections from the council -- which these days can easily run into double figures, and that’s before enduring the Sisyphusian and expensive task of trying to be awarded the Holy Grail of the Code Compliance Certificate (a task that now involves lawyers, inspectors and a pile of paperwork from everybody who’s ever visited the building site while construction is in progress.

Now despite Mr Porteous’s certified and gold-plated regulatory scheme, everything failed.  It failed not despite his new heavy-handed regime, but because of it.

JUST TO CONCRETISE WHAT I mean, let’s look at two leading players in the drama : untreated dry-frame timber produced and marketed by the likes of Fletcher’s Origin Timber and Carter Holt Harvey, and James Hardie‘s Harditex – a low-density autoclaved board made with wood pulp and cement used to back monolithic claddings.  Between them, and for reasons I’ll go into tomorrow, these two products account for more than eighty percent of the problems associated with the 7,571 properties registered with the government’s Weathertight Homes Resolution Service (WHRS). You know which houses I mean, don’t you: they’re usually the Mediterranean looking things around the place now covered with tarpaulins and scaffolding.

Without jumping too far ahead to what I’ll say tomorrow, the primary problem found in houses registered with  the government’s WHRS is that James Hardie’s Harditex “system” let water into the houses, and the untreated dry-frame timber they were built with rotted. 

Use of Carter’s and Fletcher’s dry-frame timber in wall framing was allowed because a committee of the New Zealand Standards Authority decided that it should be (and sitting on that committee were representatives of, you guessed it, Carters and Fletchers) and because the boys from BRANZ issued an “appraisal” declaring it to be fit for that purpose.  (Without ticking those boxes, no building materials can be brought to market here in NZ – and as it was then, so it still is now.)

And use of Harditex was allowed because James Hardie prepared a set of details to be used when installing the Harditex system on the outside of your house, and the boys at BRANZ duly issued an appraisal saying that it was fit for that purpose.

Everybody was happy – or at least was prepared to be happy because the process set up by Mr Porteous was working and all these materials had all the necessary ticks from all the nice bureaucrats who had your best interests at heart.  And so everyone set off in complete confidence to build the slums of tomorrow.

• Registered architects designed Harditex buildings with dryframe using details supplied by James Hardie and approved by BRANZ. 
• Master builders built Harditex buildings with dryframe using details supplied by James Hardie and approved by BRANZ.
• Building suppliers were told by both Carters and Fletchers to substitute dryframe for treated timber – and everybody was happy, because Mr Porteous’s regime had declared it to be safe.
• Building inspectors inspected Harditex buildings built with dryframe using details supplied by James Hardie, and were happy with the work – and delighted that all the details were approved by BRANZ.
• And home-owners bought Harditex buildings built with dryframe using details supplied by James Hardie and approved by BRANZ.

And everybody was happy. But they’re not so happy nowadays.

The problem wasn’t cowboys or lack of registered or qualified professionals.  Cowboys built a few of the buildings that failed, but cowboys will always be with use, and they weren’t the cause of the 7,571 failures, or of the systemic problems that caused them. Good builders and good architects relied on the process and in good faith they built and designed buildings that failed.  In fact master builders and registered architects built and designed buildings all over the country that failed – one  I’m trying to fix now was designed by a president of the New Zealand Institute of Architects, drawn up the son of a former architecture school Dean and built in good faith by registered master builders.

It still failed.

What went wrong was that the details weren’t worth a damn.  The Harditex building system wasn’t worth a damn. Untreated dryframe timber isn’t worth a damn when it’s wet.

But when it comes to sheeting home the blame for all this, it’s not those who are responsible for the materials or their approval who are feeling the heat.

Good builders who relied on James Hardie’s details are being ruined, but it looks to me like James Hardie themselves has been made immune from any responsibility.

Good architects who relied on BRANZ’s approvals are being ruined, but BRANZ themselves have been held by the courts to be immune from any responsibility.

Good home-owners who were told by Bill Porteous’s Building Industry Authority that if what they bought had made it through Mr Porteous’s regulations, were soon surprised to see the government dissolve the Building Industry Authority so that it couldn’t be held legally responsible – and to then see it reborn under a new name, in the same offices, with the same staff, as the Department of Building and Housing.  Different name, different department. “Wasn’t us, honest Guv.”

You’ve heard people damn fly-by-night cowboy operators? Crikey, you’ve never seen ‘fly-by-night’ until you’ve seen the speed with which government departments sidestep their responsibilities.  (You’ve seen it again just this week, haven’t you, this all-care-and-no-responsibility attitude that only a regulatory authority can bring to things, with the news that the Overseas Investment Commission ignored warnings that Cedenco’s owners were crooks, and instead gave them their imprimatur. )

All care and no responsibility – and not so heavy on the care. That’s the ticket for the bureaucracy.

So where is Bill Porteous now?  Bill Porteous has disappeared, and his bureaucracy has disappeared with him – and you and I are left to pick up his pieces.

Where are BRANZ?  BRANZ are still issuing appraisals that councils cling to like drowning men cling to a liferaft – and the courts have declared that BRANZ were not at fault for anything.

Everyone did it, but no-one’s to blame. Turns out you can’t sue these entities.  Turns out the government’s bureaucrats really are  above the law. Turns out that so the consequences of their mistakes and misdirections are now being visited upon the licensed and unlicensed, the registered and the unregistered, the home-owners and the would-be investors, all of whom built and designed and bought houses on the basis that the materials and standards were "certified," and all of whom now suffer the consequence of that false sense of security.

Because it turns out Frank Lloyd Wright was wrong.  Turns out that neither Bill nor BRANZ nor the BIA knew even as much as the previous generation – and they forced that ignorance on us by law.  By Bill’s law.

And big companies like James Hardie?  When good builders, designers and home-owners who relied on their materials and details are being nailed to the wall, how have they somehow managed to shirk their responsibility?  That’s an excellent question – a question that some good investigative journalist needs to answer.

The Australian government has just bailed out James Hardie to the tune of A$320 million for its responsibilities over asbestos.  Has some similar deal been cooked up over here?  I really do think we should be told. . .

* * Tomorrow: The untold problem that allows your house to leak . . . * *