Press Piece- A “perfect storm” for certifiers: BC(A)R SI.9

by Bregs Blog admin team

construction

We know from the Irish Building Control Officer’s conference in Sligo recently that Building Control Officers (BCO’s) have not been given any additional resources, are encountering difficulties with the BCMS system (electronic lodgment system for documents), and no Local Authority Code of Practice (COP) has been issued: one is expected perhaps in September. From the “Better Building” conference last week in Croke Park we were told all 20 commencement notices lodged with Cork County Council for March had problems.

No Local Authority COP may result in various local authorities having differing interpretations of documentation required at commencement and completion stages; while a lack of adequately trained staff may mean extended delays when BCO’s are forced to invalidate completion documentation, due to lack of resources to handle an extensive additonal workload. This, coupled with no forms of contract to reflect the new roles under SI9, may be the “perfect storm” for the industry. At this point we can expect delays on completion due to BC(A)R SI.9, for all project types, with no contractual mechanisms to limit or contain delays, costs and claims that may result. Headaches all round!

The Minister’s justification for not re-deploying 200 qualified building control officers (say suitably-qualified and experienced Irish Water staff) to manage a properly resourced independent local authority inspectorate with 100% inspections, was cost.

Minster’s quote from Dáil “A move to a full local authority approval system (even one which allowed for the involvement of private sector operators) along the lines of the England and Wales model or otherwise would involve significant increase in building control staffing and resourcing and would be difficult to contemplate in the present economic environment.“ See previous post here.

It is all the more extraordinary that a fully resourced independent system of local authority inspections, with 100% target rates is possible, at no extra cost and with little administrative or legislative change. This system was explored on a previous post in our previous post: “How do we fix BC(A)R SI.9?

Read Paul Melia’ article of 12th March 2014; Independent.ie: “Councils spend half a billion on projects they’re unable to afford

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Extract from article here:

Councils spend half a billion on projects they’re unable to afford

CITY and county councils have spent more than half a billion euro building houses and water treatment plants and buying land without having funding in place.

A report from the Department of the Environment says that almost €540m has been spent on capital projects without funding being available, and warns of the “deteriorating financial position” of a number of councils across the country.

Some 20 of the 34 local authorities are technically insolvent, and are relying on overdrafts and bank borrowings to meet day-to-day expenses.

In some cases, all discretionary spending has been “effectively eliminated”, with Sligo County Council warning that it is retaining services “at levels to ensure compliance with statutory obligations”.

The Local Government Audit Service Activity Report examines spending in 2012, the last year for which figures are available, and warns that the merging of city and county councils, abolition of town and borough councils and the transfer of water services to Irish Water will present “major challenges” for the sector.

“Management should have in place additional reporting/ oversight arrangements on the activities of the merging authorities as and from January to May 2014,” it says.

“The finance functions in local authorities must be adequately supported to deliver the significant demands in this area.”

The report also notes a sharp decline in spending among councils since the height of the boom, particularly on capital projects. Spending in this area has plummeted from €6.134bn in 2008, to €1.791bn in 2012.

Purchase of land and other assets has dropped from just over €1bn in 2008 to just €163m last year, and development contributions are down to €45m from €460m in six years ago.

Key concerns raised include the level of unpaid charges, including rates and rents, across the 34 local authorities, poor financial management and a failure to go to the market to seek the best price for services.

REVALUATION

Councils also owe some €2.3bn, some of which is only being repaid on an interest-only basis. In addition, people who secured mortgages through the local authorities owe €1.3bn, but arrears in this area are mounting.

Some council staff also enjoy “acting up allowances” for carrying out particular roles, without approval from the Department of the Environment, and assets are not being properly recorded.

There are also concerns about a lack of internal audit functions in some councils to oversee day-to-day spending. There is a “lack of oversight” in how scarce public funds are being spent in some cases, while Mayo County Council was criticised for “effectively disbanding” its internal audit unit in June 2011.

The report says a “major revaluation” of assets including land, buildings and houses will need to be undertaken “when market conditions allow”.

On the issue of unfunded balances for capital projects, council managers have indicated they will be funded from future development levies, sales of assets and grants from the department.

Among the reasons given for the deterioration in local authorities’ finances are the general economic collapse, reductions in funding from the Government, the cost of servicing loans and payment of retirement gratuities to departing staff.

The report says some €289m was spent in 2012 on pensions and gratuities.

The Department of the Environment said the overall spend in councils had reduced “considerably since 2008 as the amount available from central government has been pared back”.

Staff numbers had dropped by 26pc from 37,243 in June 2008 to 27,456 in December 2013, with deep cuts in payroll including overtime and allowances. Savings of €839m were made in the same period due to efficiencies and changes to work practices.

A spokesman said the merger of councils in Tipperary, Limerick and Waterford, coupled with the dissolution of town and borough councils, would save up to €45m a year.

Irish Independent

 

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