Monday, February 27, 2012

The unintended consequences of new regulations

On March 1 the Licensed Building Practitioner regime comes into effect.  This began as a response to the Leaky Homes issue, and was generally supported by architects as recognising professional competence and responsibilities.
The danger is that the complexity of the system will create a costly process that will frustrate and add unnecessary costs to building procurement.  
The NZ building industry is not alone in this dilemma.  The proliferation of rules that have good intentions but impose huge cost burdens collectively is becoming a major concern everywhere.  Like most countries, NZ needs a smarter approach to regulations. First, all important rules should be subject to cost-benefit analyses by an independent watchdog.
Second, all big regulations (like the LBP regime) should come with sunset clauses so they expire say in 10 years unless Government reviews and renews them. 
But most important of all - regulations need to be simpler.  All-purpose regulations submerge the important issues in a sea of verbiage.  Far better to lay down broad goals and prescribe only what is necessary to achieve them.  And the danger of handing too much power to unelected bureaucrats must be addressed by making them more accountable. 

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