A changing landscape?
An opinion piece on the Building Control (Amendment) Regulations, 2014, six months after their coming into force
Eoin O Cofaigh FRIAI
1 September 2014
On 1 March last, two years after the first public consultations (although there had been several years of private negotiations with “construction sector stakeholders” before then), the then Minister for the Environment, Community and Local Government, Mr. Phil Hogan T.D., brought the Building Control (Amendment) Regulations 2014 into effect.
There had been many warnings before that date as to the effect the regulations would have on the liability and workload of those who would be “certifying compliance” of designs and of buildings under the new regulations; on the volume of construction starts; on foreign direct investment projects; on alterations works in Places of Assembly; on architectural technologists and others excluded from accepting the Designer or Assigned Certifier roles; and on those people following in the centuries-old tradition of “self-build” for their homes. Most importantly, there were assertions about the likely effect of the regulations on the quality of building design and construction – none; that the regulations would mean more paperwork but not result in better building; and that the intended beneficiary of the regulations, the “consumer”, principally the first-time homebuyer, would not benefit at all.
So what can be seen now, six months after the regulations took effect?
Let’s start with the peripheral effects before getting to the core of the matter: protecting the home buyer.
2 The BCMS
The Building Control Management System was an attempt to do several things at once. A hitherto paper-based system was to be modernized and extended hugely at the same time. The BCMS designers set out to computerize the preparation and lodgement of Commencement Notices, and alongside this to incorporate the new Assignment Forms, Design and Completion certificates, and to deal with the requirements to upload design, specification and commissioning documentation.
Notwithstanding the advance notice available to the Department, the system remains, 18 months later, at the beta testing stage, according to the BCMS website. The system does not permit the electronic lodgement of Notices related to those material alterations of existing non-residential buildings where no fire safety certificate is required. The requirement to fill out the form electronically, download and sign it, scan and upload scanned paper material is bizarre. After all the Health and Safety Authority, requires the electronic signature of Commencement Notices under the Construction Safety regulations!
No doubt all this will be dealt with sometime or other. It is regrettable that the repeated warnings prior to 1 March of two RIAI Presidents, that the system was not ready, were ignored. In the meantime, those who must actually implement the regulations, in design and local authority offices alike, struggle to do so.
3 The paperwork
Launching the earlier version of the regulations, S.I.80 of 2013, Mr. Hogan said “Each local authority, when it receives the final certificate of compliance, will retain all drawings and particulars relevant to buildings/works and include the final Certificate of Completion on its statutory register. The documentation will be accessible to anyone who subsequently acquires an interest in the building concerned.
“As soon as these regulations become operational, homeowners who encounter a problem with a building will be in a radically better place. They will be able to immediately access information which can lead them towards a solution to the problem. Consumer protection is all about maintaining and controlling information, this is the first time we’ve had such protection in this area.”
Pre-regulation predictions that up to 300 separate certificates, specifications and the rest would be needed for upload upon Completion have yet to be borne out. What is clear is that there is more paperwork involved than the designers of the BCMS planned for, with 100 documents to be uploaded on the simplest of non-residential projects. The BCMS cannot handle it!
In an Information Age, it seems to be that people think the more information which is available: the better. But more paper doesn’t mean better building.
4 The Assigned Certifiers
Those who wrote the regulations expected that the project architect would act as Assigned Certifier on up to 98% of all building projects. This was to be the “meal ticket for life” for a profession reeling from the 90% shrinkage in Construction Sector output in the period 2008-2013.
So unlikely did the engineering profession consider any involvement on the part of engineers in the AC role, that ACEI and Engineers Ireland issued no guidance to their members in that regard.
Those who promoted the regulations within the architectural profession suggested quietly that S.I.80 / 9 would see the end of the partial service; that the self-builders would be obliged to employ them; that architects would be providing more services from now on, and thereby gain more work.
The reality has turned out to be rather different.
A minority of the architectural profession have embraced the regulations, seeing in them a chance to make a living again. Faced with threats of losing clients, rather more architects have responded to the regulations by reluctantly taking on the Certifier roles. A substantial number are refusing the roles and pointing their clients towards third-party certifiers.
This, in turn, has led to a small number of engineers offering dedicated Certification services, and to a larger number of engineers acting from time to time in the role. A Changing Landscape. Anybody concerned with “stopping the drift to the edge” of the architectural profession should be disappointed with the unanticipated outcome; while those who hinted at a chicken in the pot of every rural-based architect have yet to account for the error of their predictions.
5 The Designers
The task of certifying compliance with the regulations of every aspect of the design of the building or works has hitherto received less attention than the certification of the finished works.
This seems to be because some architects, traditionally the “design team leader” and still this on the majority of building projects where they are involved, believe themselves so competent that they are willing not only to carry out their own work but also to take responsibility for the inputs of the consulting engineers and the other specialists.
Perhaps in consequence for architects, the RIAI has issued next to no guidance for its members on acting in the Design Certifier role.
Were S.I.9 to endure, this will be an urgent task to remedy, as workload and responsibility alike are now emerging as larger than anticipated.
6 The Contractors
Launching the regulations in March 2013, the Minister announced that “The Construction Industry Federation …. is devising proposals in collaboration with the Department on a voluntary scheme of registration for builders and contractors with the intention of transitioning this to a statutory scheme over time when it is proven to be a quality registration scheme and operating effectively in practice.”
This voluntary scheme is now up and running. Time will tell whether the scheme is one of “quality registration” and whether it operates effectively in practice.
But on construction projects for private sector clients, architects have for decades advised clients to choose only good builders. This informal but highly effective quality control scheme cannot, it seems, operate today on public sector contracts due, we are told, to EU Competition rules. The Brussels Fall-Guys take another hit!
And so, perhaps the CIF register will be useful in raising standards by, over time, allowing architects and other advisors of building owners exclude the incompetent, the litigious or the just plain greedy from public and private sector tender lists alike.
Meanwhile, the RIAI’s calls over the years for statutory registers, not only of main contractors but also of all key trades, await a response.
7 The “self-builders”
The regulations provide for a statutory “Undertaking by Builder” and statutory “Certificate of Compliance on Completion” “to be signed by a Principal or Director of a building company only” with a space left blank for insertion of a “Construction Industry Register Ireland registration number (where applicable)”.
On the face of it, the criteria for eligibility to sign the forms, which also include a requirement that these people be “competent” exclude a private person acting in their own capacity from so certifying. The Irish Association of Self Builders say this is increasing their construction costs by 10% due to a need to appoint a contractor to manage their projects. This is on top of the outlays “self-builders” incur to appoint a design Certifier and an Assigned Certifier on each project.
The Minister has opined that a competent self-builder is not excluded from acting on her or his own behalf.
Six months in, it is too early to say how solicitors acting on behalf of funding agencies such as banks or building societies, or on behalf of persons seeking to buy such houses in the event of their being sold, will react to “self-signed certificates”. Is it too cynical to imagine that where a bank wishes to delay a loan, it would never raise a question about such a certificate? Perhaps it is.
8 The architectural technologists
S.I.9 is silent on architectural and engineering technologists. However, the warnings throughout 2013 that self-employed technologists would de facto be largely precluded from continuing to earn their living as a result of the restriction of the Design and Assigned Certifier roles to registered architects and building surveyors, and chartered engineers have proven correct.
This, in turn, has had two outcomes. The landscape continues to change … Under pressure from its own technologist members, the RIAI grasped a nettle of many years’ growth and decided to (a) support a register of architectural technologists and (b) to work with the State to achieve one. Other technologists saw this move as a cynical one designed to protect the RIAI’s influence in an area where technologists’ interests had not been represented properly for years – as evidenced by S.I. 9 itself. The RIAI’s work on this register has yet to bear fruit. We await the desired outcome: the fulfillment of Council’s will in this regard.
The second outcome is that the Department of the Environment is now consulting various interest groups on such a register.
To exclude by Law a person who by training and experience is competent to evaluate building designs against the requirements of the building regulations from actually so doing and thereby to deprive them of a livelihood which they have been making for many years is unjust and unjustifiable.
The “changing landscape” needs to get a move on.
9 The Law Society of Ireland
On 6 June, the Law Society Conveyancing Committee advised solicitors involved in property conveyancing as follows:- “The only certificate of compliance with the Building Regulations that will be required is a copy or a certified copy of the certificate of compliance on completion in the form prescribed in the sixth schedule to SI no 9, as registered with the Building Control Authority.”
No call for Ancillary Certificates! It seems the lawyers have concluded that in the event of there being a problem with the as-constructed building, it’s to be laid at the door of the Assigned Certifier.
This, it would appear, is what Minister Hogan envisaged when he said in March 2013 that “If anyone signs a statutory certificate for a building which subsequently proves to be non-compliant, they can be held legally liable for the consequences”.
This was and remains the central plank of the regulations:- “a clear chain of responsibility for building works prior to commencement through to completion”.
The simplicity of the new system: one Assigned Certifier; one clear certificate; no need to bother with the ancillary certificates: will be a boon for the plaintiff and her or his lawyers in the years to come.
The directness of the system which S.I. 9 has put in place is set to simplify the proceedings and thereby reduce the cost of litigation against certifiers, and to speed up the hitherto often protracted sets of proceedings associated with construction defect. Those who consider more litigation to be a good thing will see this as an advantage.
10 The regulatory authorities
The Royal Institute of the Architects of Ireland (RIAI) describes itself as “the Regulatory and Support body for Architects in Ireland”.
When the 2013 version of the regulations was introduced in March 2013, RIAI Director John Graby said that “The new Building Regulations – prepared by Minister Hogan and his Department – represent one of the most significant efforts to strengthen the country’s building control system since the introduction of the original Building Regulations over 20 years ago and they are to be commended on this”; and that “the 12-month implementation period announced by the Minister will give the Government and the country’s Local Authorities the time they need to get their inspection and monitoring systems operating effectively.”
It is now 6 months after introduction of the regulations and 18 months after the RIAI’s commendation of the Minister and his Department. This lengthy period has, however, not resulted in the desired improved effectiveness in the Local Authorities’ inspection and monitoring systems.
11 The liability
Launching the regulations in March 2013, Minister Hogan said:- “The mandatory certificates will be clear, unambiguous statements on statutory forms stating that each of the key parties to a project certifies that the works comply with the building regulations and that they accept legal responsibility for their work. If anyone signs a statutory certificate for a building which subsequently proves to be non-compliant, they can be held legally liable for the consequences.”
At a seminar in Dublin Castle in May 2013, an Official involved in drafting and promoting S.I.80/9 said that in his opinion “what we’re getting now, is what the consumer thought they had” as regards Opinions on Compliance with building regulations. The key difference between the old Opinions regime and the new Certification system being just that: certification and not just an opinion, and not as regards “substantial compliance” but as regards total compliance in all aspects.
Since March 2013, there have been a number of amendments to these “statutory forms”. Whether those amendments will have had the effect of diluting the Minister’s view about “clear, unambiguous … statutory certificates” is as yet unclear. It is difficult to see the State losing focus in that regard.
Writing in August 2014, Mr. Hogan’s successor as Minister, Mr. Alan Kelly T.D., wrote that “The recent Building Control (Amendment) Regulations 2014 … aim to strengthen the arrangements in place for the control of building activity by requiring greater accountability in relation to compliance with Building Regulations in the form of statutory certification of design and construction, lodgement of compliance documentation, mandatory inspections during construction and the validation and registration of certificates of compliance.”
Minister Kelly is clear: the regulations require “greater accountability in relation to compliance … in the form of statutory certification.”
I am not qualified to discuss the difference between accountability and liability. To me, the concepts sound closely related.
Six months after the regulations came into effect is too soon to say how matters will work out in practice. Senior Counsel’s Opinions on the liability accruing to the certifier under S.I.9 vary from it being “no worse than it was under the old system” to “absolute and in the nature of a guarantee”. The views in some quarters that a criminal liability will devolve on the Assigned Certifier should they fail to respond to a request from a building control authority for information in connection with, say, validating a Certificate of Completion, await refutation.
In any event, the Government’s intentions: “greater accountability in relation to compliance” seem well flagged over the past 18 months. The Construction Industry Federation agree:-
Interviewed on Louth/Meath local radio on 16 July, Director General Tom Parlon was asked:- “What about the issue of somebody who joins the [CIF] Register, builds a house, maybe it’s full of pyrite or the ceiling falls in, and basically it turns out that even though the builder is on the Register they do a bad job – are there penalties for that individual that they must pay?
Mr. Parlon replied:- “There are penalties already under the new building regulations, everything must be signed off by a competent Assignee, who can only be an architect, a building surveyor or an engineer, and in signing off on behalf of the builder, there are obligations there and they have to stand over those.”
The consensus seems to be that there is indeed greater accountability in relation to compliance. The Assigned Certifier signs off on behalf of the builder.
But let’s leave the last word to Minister Hogan, who, on Morning Ireland last February, said:- “what we are trying to do here is to make sure that people like [a self-builder] would be able to get a guarantee that what is signed up for by a professional in the future means what it says – and that an architect or a building surveyor or a chartered surveyor that signs off on this will be able to say that this is what it has done, this is the whole chain of responsibility.”
12 The Impact on Construction Starts
Before 1 March, those who said the new regulations serve neither the consumer’s nor the certifier’s interest told the Government that the complexity of the system, volume of paperwork, liability placed on the certifier, and five-week period allowed to validate Completion Certificates on even short fit-out projects would slow down construction starts.
That is how things have worked out.
The DoE issue monthly statistics showing the number of dwellings covered by Commencement Notices. There was a “spike” in the number on Notices served in February. This was expected, before S.I.9 came into force. But the Department have not updated the statistics since. And so, their statistics do not permit comparison between the number of dwellings covered by Commencement Notices since S.I.9 came in, with the same period in other years.
Other sources are, however, available.
The Local Government Management Agency Building Register records validated Commencement Notices received on the BCMS. 1645 Notices were received between 1 March and 31 July. This would equate to 3950 for a full year. This would represent an astonishing 45% decline on the 7456 Notices submitted in 2013.
But matters are worse than this.
Everybody, including the DoE, accepts that the “February spike” was a rush to beat the introduction of S.I.9. But not all of those Notices cover real project starts. If they did, there would have been a matching spike in tender volumes beforehand. There was none. And there would have been a matching increase in construction activity in April/May. There was none.
There was no spike in tender volumes in January/February; and no spike in the Construction Purchasing Managers’ Index in early summer.
Six months into S.I.9, indications are that the number of construction commencements in 2014 will be lower than in 2013.
The February spike in Commencement Notices was on paper, not on shovels.
Many factors, not only S.I.9, impact on construction sector output. The most important? Economic growth and availablity of funding. Given returned growth, construction output should increase. Moreover, funds available to service construction activity are no less than they were in 2013. A 50% decline in the number of Commencement Notices served and validated cannot be blamed on funding shortages.
It is becoming clear that the paperwork, liability, lack of systems preparation, and increased costs S.I.9 has caused are contributing to a substantial reduction in construction sector output in 2014 as compared with 2013. The effect on employment and tax returns is beyond my ability to analyse.
13 Latent Defects Insurance
Launching the regulations, Minister Hogan said “I am keen that the issue of insurance for construction projects is addressed before the new regulations come into effect next year. I am therefore undertaking a review of construction project related insurance in conjunction with Minister Bruton before the new regulations commence.”
Carefully chosen words. Perhaps the “issue of insurance [was] addressed”, and perhaps a “review of construction project related insurance” has been undertaken.
18 months after the Minister’s words, there is no State-backed LDI scheme in place or in sight. This is a tragedy. A no-fault system of Latent Defects Insurance would be a huge advantage to the home buyer in securing speedy, litigation-free and technically competent remedying of defects. The cost of such schemes in other countries runs at about 1% of project cost. What first-time home buyer would not welcome such a system with State supervision?
14 The impact on the building owner
The regulations impose new duties on owners commissioning design and construction works on most non-residential construction projects. They must employ Design and Assigned Certifiers, who submit drawings and specifications to building control authorities, at commencement and before completion of the works. The building may not be opened or occupied until the local authority validates those submissions.
Before 1 March last, it was unclear why, when the regulations responded to failures in the residential sector, the Government imposed a greater burden on all sectors. Since 1 March, no advantage has become apparent.
By requiring valid “Completion Certificates” before a building may be occupied, the regulations increase uncertainty around completion of all projects. This will impact adversely on projects needing timely completion, such as shops in the run-up to Christmas, hotel and pub licensing applications, and short-period fit-out projects where the job will often be finished before the timescales in the regulations can apply. (“Serve the Completion Certificate before you start the job and you’ll be right!”) The period since 1 March is too short for the extent of this problem to become apparent.
In the commercial sector, the cost of compliance is borne within the “closed circle” of income derived from sales. The cost of paying the certifiers must be recouped from customers, or by reducing profits or overheads. The costs quoted in the residential sector for “Certifier services” show that this is a significant extra cost in building project procurement. The evidence of any benefit to the non-residential building owner of such increased costs has yet to appear.
15 And what about the consumer?
Launching them in April 2013, Minister Hogan said:- The regulations “set out to prevent the future reoccurrence of poorly constructed dwellings, pyrite damage and structures breaching fire regulations left as a legacy of a poorly regulated housing boom. This is all about restoring consumer confidence in construction as an industry.”
In the six months since 1 March, what evidence has emerged that the future reoccurrence of poorly constructed dwellings, pyrite damage and structures breaching fire regulations is now being prevented?
None; nor is there likely to be any. Local authorities, who alone under the present system have the power of systematic inspection over multiple building sites, don’t intend to exercise it. S.I.9 facilitates no identification of “systems failures”, such as the pyrites scandal which could have been identified two years before it actually emerged. The quantity and shape of the litigation in coming years is all there is to go on.
16 But is there no chance S.I.9 might do some good?
Whether S.I.9 is likely to succeed in its stated goals can be debated. But given that the legislation did not take account of the relevant recommendations of the Pyrites Panel, one might be forgiven some scepticism in this regard.
Set up to report on the causes of the “pyrite problem” which was the genesis of the entire regulatory change, and to make recommendations as to how that problem might be avoided in the future, the “Pyrite Panel” reported to the Minister in June 2012. But the regulations fail to implement the relevant recommendations in the Pyrite Panel report.
Recommendation 18, a “Mandatory certification system” recommends that “the system of independent inspections, carried out by the building control officers, should be strengthened to complement the mandatory certification process for buildings”. This was not done. To get building regulations compliance from a builder and his subcontractors, there must be the reasonable likelihood of independent statutory-backed inspection.
Recommendation 21: General Insurance issues, recommended (b) “a requirement for project-related insurance whereby cover for each specific project is available and adequate and is related to the project only”. This was not done. By not implementing this recommendation, the regulations ensure litigation and distress for home-owners will continue to feature where buildings go wrong, whether in pyrites-affected dwellings or for the Priory Hall residents.
17 So what should be done with S.I. 9?
The self-certification in S.I. 9 should be replaced by a system of independent third-party inspection. Inspections would be by experienced construction professionals, paid by the developer but licensed by and answerable to the local authority. Experienced independent inspectors will achieve better results; level the field for the self-builders; allow technologists to participate; guarantee local authority-backed inspection of 100% of building sites; solve the intellectual property issues; and could be done for €2m per year.
There is no mystery about this. Such a system operates in Northern Ireland. Such a system can and does work, deliver better building, and can cost the State a net nothing, the cost being paid for by the Developer and through increased Commencement Notice fees. Ask those involved. Ask the building control officers, architects, fire officers, latent defects insurers, and home buyers.
18 A better system of regulation is at hand
So what might a better system look like? Like this:-
- Set up a register of “Approved inspectors”, answerable to the building control authority.
- This register to be open to architects, architectural technologists, appropriately qualified engineers, and building surveyors, with appropriate qualifications and adequate experience. Admission to be competence-based.
- The Approved Inspector to carry appropriate professional indemnity insurance.
- To start with, the system to apply in the speculative residential sector and to the one-off (“self-build”) house. That’s where the problems were.
- The Approved Inspector audits the design and inspects the building site for one purpose: compliance with building regulations. The job architect or engineer does everything else, the same as before.
- Inspection of designs would include Parts B and M for one-off houses. Pending review, fire safety and disability access certificates would still be required for apartments.
- The design team must still prepare full designs and inspect the works as at present. The contractor must build in compliance with the building regulations as is routinely done on well-organised buildings. The Approved Inspector reports to the Local Authority at the start and completion of construction, confirming that he has inspected the design and construction and found nothing wrong.
- If the Approved Inspector finds non-compliant design, he refuses to issue the Design Certificate until he gets amended drawings. Given that the architect will have to explain any delays to his client, the architect will make sure the designs are right in the first place. This raises design standards.
- If the Approved Inspector finds non-compliant construction, he tells the contractor and the architect, and has the ultimate sanction of a “Cease Works Notice”. He will refuse a Completion certificate until the matter is put right.
- The Approved Inspector inspects 100% of designs and sites. On top of this, the building control authority profiles risk, and inspects a small number of designs and building works, to ensure that the system is working and keep tabs on the inspectors.
- Latent Defects Insurance, paid for by the developer with a one-off up-front payment, picks up any defects which get past.
19 Why is this system better than that in S.I. 9?
- The cost to the State is minimal. The developer pays the Approved Inspector. The only cost to the State is to maintain the register and monitor the operation of the system. This could be funded through an appropriate license fee.
- Having designs audited specifically for building regulations compliance by an experienced independent architect or engineer will drive better design standards.
- When the experienced Approved Inspector arrives on site, who has inspected many sites and knows what to look for, concerned with nothing except building regulations compliance, with local authority statutory backing, he or she will instantly drive better construction standards.
- The system will give better design and construction, not just better paperwork.
- Appropriately trained, experienced and insured architectural technologists whose livelihoods are undermined by S.I. 9 can and must be allowed act as inspectors.
- The system solves the self-builder issue. It gives him a straightforward independent inspection system which he pays for, the same as anybody else. If his designs are good enough – they pass. If they are not, he must prepare an adequate design, the same as anybody else, however he chooses. If his building is good enough when the Approved Inspector arrives – fine. If not, he must rectify the defects, the same as anybody else.
- It solves the FDI issue.
- The system requires no change to construction contracts and hence will not cause delays in the construction sector. The Approved Inspector operates independently of the contract administrator (Architect or Engineer) and has statutory authority.
- The system is better for the consumer: as the National Consumer Authority says, independent third-party inspection will give better results than a system of self-certification.
- The system protects the consumer from loss with a no-fault system of redress and no litigation is needed.
- The person who buys or rents a new home gets independent third-party audit by experienced professionals, answerable to the local authority.
- The system is better for the construction sector: driving higher standards through experienced inspectors who with larger and recurring workloads will feed-back into better design and better building.
Through feedback to the local authorities of the inspectors’ experience across many designs and sites, systemic problems will be spotted earlier.
Eoin O Cofaigh: President, the Royal Institute of the Architects of Ireland, 1998-1999; Honorary Member, Bund Deutscher Architekten; Honorary Member, Bund Deutscher Baumeisterer; Honorary Member, Soyuz Architektorov Rossii; Honorary Member, American Institute of Architects; Member, Building Regulations Advisory Body, 1991-1997; Author, “Building Control” in: Construction Projects: Law and Practice: Round Hall, 2007 – date; Architect in private practice, Dublin, 1981 – date
Other posts of interest:
Collins & O Cofaigh- A BETTER way: BC(A)R SI.9 Solutions
Friday Follow | Eoin O’Cofaigh FRIAI
Eoin O’Cofaigh: missed opportunity? BC(A)R SI.9