Is the LBP Scheme working?
It’s been ten years since the LBP scheme was launched, and despite early criticisms, it is now firmly established, giving builders a genuine mark of credibility and customers a much stronger sense of assurance and accountability.
But how well is the scheme working and what effect is it having on the business of building? We spoke with LBP Scheme Registrar Paul Hobbs to get an idea of how things have panned out over the last decade.
Primarily, the legislation was written to provide accountability, traceability and a standardised level of competence across the various trades and design classes that we licence. It means that consumers can engage a tradesperson knowing they have the skills and knowledge to carry out the restricted building work they do.
Is it working? Certainly there has been huge progress, but it’s worth remembering that it’s a progressive thing. When you look at equivalent schemes across the building industry sector, the LBP scheme is the youngest by a long way.
For example, electrical workers were licensed in the 1920s, whereas is was only in 2012 when the LBP scheme really came into effect with the introduction of the restricted building work legislation.
The LBP scheme has strong consumer recognition, which continues to grow, and builders and tradespeople generally are becoming more conditioned to having an occupational licence regime.
One of the great things is that licensed building practitioners are traceable; an LBP number is like an IRD number – it’s for life. It doesn’t matter where you work or even if you have several businesses over a number of years, you only ever have one LBP licence.
If a customer has a concern about the conduct or behaviour of an LBP, they can lay a complaint. And we’ve seen the number of complaints increase steadily year on year.
Three years ago, there were 113 complaints. The next year, it went up to 193 and in the last financial year, there were 217 complaints.
It seems to be levelling off so we think that this is probably the new “normal”. Some of the complaints are about misdemeanour offences; others are a bit more serious.
The people we are most concerned with are the recidivist offenders that are knowingly doing stuff wrong on a regular basis, and not the people who have made an honest mistake.
Of the 217 complaints that went to the Board this (financial) year, 121 individuals were disciplined. And of course, that is reflected on the LBP register.
So when you click on their landing page, you will see it – it’s a mark on their licence which potential customers will see as a red flag, so it’s a really strong deterrent.
By far the most common complaint we get is about misunderstanding the way records of work should be issued, and while it’s not serious, it can cause a lot of unnecessary problems along the way.
So there’s some work there to be done in getting those things right and that’s mostly about education.
Another common complaint relates to poor understanding of the requirements of supervision.
If you’re doing simple work with skilled people doing it and you’ve seen them do the same work many times over, then you can take your foot off a bit, you can apply a lighter touch.
But if you have unskilled people doing fairly complex work, then you want to be in direct supervision mode as opposed to supervising remotely.
We’ve recently released a supervision practice note that clarifies the roles and responsibilities of LBPs who supervise others’ work.
The building industry is very busy and there’s a shortage of skill labour and that environment leads to obvious problems. Unfortunately, your excuse that you were too busy won’t cut it.
Because there’s an abundance of work, people get exposed to work they might not have done before. For instance, a successful builder specialising in stand-alone houses might get an opportunity chance to take on a multi-unit townhouse project.
If he wins the bid, he has to quickly take on three extra guys and suddenly there’s all this supervision that has to happen and the builder hasn’t enough time to do it properly.
If you’re a small team and you’re expanding by taking on more projects and more people, you have to accept that you need to provide more oversight. And if you don’t provide that oversight, work quality is going to suffer and there will be problems with the consent process and inevitable delays with project completion.
Not only this, but where builders aren’t adhering to the Building Act when carrying out their work, they can expect to be held to account by the Building Practitioners Board.
Because of the pressure to build and shortage of skilled labour, we’re seeing more hammer hands, more semi-skilled or low skilled workers on site, and that’s when the need for supervision is greatest.
According to the latest construction pipeline report, the building industry is going to be busy right through until 2022.
Regionally, we can track how many consents are issued compared with number of LBPs in any given area. In Auckland for example, there are far fewer LBPs per consent than in any other place in the country.
Of course there is more building activity in Auckland than anywhere else, and the issue of lack of supervision is being reflected in the number of complaints we get.
As an LBP, you can either do the job yourself or supervise others, but you’re equally accountable in both cases if the job doesn’t comply.
There’s a group of LBPs that are by nature not good information seekers. They know sometimes they’re doing something that’s not right, and there may be some doubt over compliance, but still they proceed.
We’ve had cases where someone has told someone else that yes, there was consent for the work, and while they’ve questioned it, they haven’t followed it up. Then the council gets onto it and the builder gets stung for commencing work without a consent.
Another familiar theme we see in range of complaints we receive is that there is often a strong link to the contract going wrong.
People aren’t administering the contract well and so when things go wrong, they start looking for grounds to lay a complaint against the LBP, but the real problem is that the contract has gone wrong.
It’s worth pointing out that the major focus for the LBP scheme going forward is to ensure that our builders and tradespeople keep their knowledge up to date. A lot of our activities are based on providing information and education.
Over time, things change and there’s new stuff coming on the market all the time. The LBP’s core competency wouldn’t change, but if a building standard is changed or we’ve changed a method of compliance, then the builder needs to be fully aware of the changes.
We are collaborating with a number of building related organisations and publishers to make sure builders are provided with the latest information in a timely manner.
We’re highlighting significant changes that might affect them. We’re not trying to sell them anything; we’re just trying to get the right information into their hands.
We made some changes to the skills maintenance model in 2015 after consulting with industry groups, the NZCB, and Registered Master Builders associations, the BCITO and others. We simplified the points system to make it easier for specialist trades and people in outlying areas to achieve their LBP targets.
Having said that, we are always reviewing things, listening to feedback and looking for ways to make things better. The industry is changing all the time and it’s important that we keep abreast of those changes for the benefit of our members and the public at large.