NSW Fair Trading Enacts Ban On Unsafe Cladding

NSW Fair Trading has established an immediate ban on combustible aluminium cladding in residential and commercial buildings. The ban is part of an ongoing effort to prevent the rapid vertical spread of fires associated with these products.

NSW Fair Trading’s inquiry and public submissions commenced on 23 March. It sought to discuss whether a building product use ban was warranted for certain types of external cladding on buildings, and if so, what the terms of a ban might be.

Several public and private sources considered submissions, including NSW Fire and Rescue and the CSIRO. Similar approaches have been adopted by other Australian regulators, namely in Victoria, Tasmania and South Australia.

Details of the cladding ban

As of Wednesday, 15 August, aluminium composite panels (ACP) that contain more than 30% polyethylene by mass will be banned in residential buildings over 2 storeys. Additionally, ACP will be banned across commercial buildings higher than 3 storeys. This is because ACP contains a component identified as posing an inherent risk to the spread of fires.

The ban also classes the use of the banned building products as an offence, introducing accompanying fines. Organisations that don’t comply with the ban’s requirements can be fined up to $1.1 million and individuals can be fined up to $220,000. The ban also applies retrospectively to any buildings which had these products installed before the ban’s introduction.

This naturally comes as a concern to builders and owners. Most builders and owners don’t know if they are liable or if they have used non-compliant cladding. As a result, those affected will have to contact their landlord or insurer to ensure that they are aware of this issue and are taking the necessary steps to resolve it. Additionally, those with concerns should seek professional advice from a provider such as Hendry.

Aluminium cladding deemed a major defect

Aluminium cladding was identified as a ‘major defect’ by NSW Fair Trading in April this year. But what does this mean for new and prospective owners? Well, the ruling means anyone who buys a unit or townhouse which is found to contain banned materials has the right to get repairs done by the builder responsible. Owners are entitled to these repairs for up to 6 years after the building is completed.

Commissioner for Fair Trading, Rosemary Ann Webb, acknowledged these products are in contravention of the NCC. However, she noted that ‘the code cannot be relied on in isolation to address the safety risks associated with [this cladding]. At present, the NCC is not sufficient to regulate building products.’

We agree. Under the current NCC provisions, you can have a composite panel. The composite panel may contain combustible components but still pass the test for combustibility under Australian Standards. The metal cladding itself may not be combustible. Still, the materials holding the cladding together or fixing it to a structure may be. This is most likely a result of fillers, binders or glues.

The ban by NSW Fair Trading will be necessary, as will be the case in other states. The ban will provide direction to the industry as a whole on what is seen as an acceptable building material. It will recommend how practitioners, owners and occupants can manage non-compliant materials by covering any potential ambiguities in current NCC guidelines.

Implementing consistent, nationwide changes

At the same time, the Australian Institute of Architects (AIA) calls for the country’s building ministers to implement consistent, nationwide changes to the NCC. The idea is that these changes will maintain a consistent and compliant solution through a national best practice model.

There have been many discussions regarding this decision by the NSW Fair Trading Department. In particular, information on national Government action has come to light. We’ve identified the following:

• The Australian Government rejected a recommendation made by the Senate inquiry into non-conforming building products. The recommendation being to ban the importation, sale and use of combustible cladding. Determining such a ban would be neither effective nor practical. The recommendation was one of 8 made by a report on aluminium composite cladding released in September 2017 by the Senate Economics References Committee inquiry. The report’s recommendations addressed the fire risk posed by the non-compliant use of polyethylene core aluminium composite panels (PE-ACPs).
• The Government determined that a total ban on PE-ACPs would be ineffective and impractical. Due to difficulty in identifying PE-ACPs, legitimate uses of the material, domestic manufacturing, international trade obligations and costs to industry. The Australian Government believes the national measures will effectively increase the accountability of all participants across the building supply chain. Furthermore, they believe national measures will improve building product conformity and compliance with the NCC.
• The NCC prohibits combustible cladding on high-rise buildings in most cases. It is unnecessary to ban it twice. But we should take greater enforcement measures of the legislation we already have that requires a high level of fire safety in Australian buildings. As the Government highlights, several important reforms have been introduced in Queensland and New South Wales. Particularly since the senate inquiry made its recommendations. Some of which are addressed by new legislation.
• Refinements are also underway in NCC 2016 Amendment One. The amendment introduces further clarification and guidance on using combustible cladding on buildings. The Commonwealth government will work with state and territory governments to establish a national licensing scheme. The scheme will feature requirements for continued professional development for all building practitioners. The Commonwealth government is considering imposing a penalties regime for non-compliance with the NCC, such as revocation of accreditation.
  
  

How Hendry can help

Hendry provides services and recommendations for preventing the use of non-compliant and combustible building materials and existing regulations. Hendry has not been the subject of any fault claims and can provide reassurance to clients regarding our services.