James ThomsonSenior Adviser - Standards & Regulation

Standards and Regulatory Services

REPORT: The quest for a level playing field: The non-conforming building

products dilemma

Non – conforming product Definition

Products that:

do not meet regulatory, Australian or

industry standards; are not fit for their

intended purpose;  are defectively made or

not of acceptable quality;  contain false and

misleading claims; do not meet performance

claims (whether intentionally or

unintentionally) or are intentionally counterfeit.

Scale of the problem• 92% of the 222 respondents reported non-conforming

product in their market sector

• 45% of respondents reported NCP had adversely impacted on revenue, margins and employment numbers

• 43% of respondents had not lodged a complaint when encountering NCP

Weaknesses and failure points• Inadequate: surveillance, audit, testing, first party

certification and enforcement

• Building certifiers bear a disproportionate share of burden for product conformance – too much emphasis on identifying conformance post installation

• Confusion among stakeholders on who has regulatory responsibility and what recourse there is when NCP is found

Electrical sector

• $8 B market

• 46% of respondents were manufacturers / fabricators and the balance distributors

• 100% reported NCP in their market

• 71% had been adversely impacted

• Failure points: lack of harmonisation of electrical laws, lack of surveillance and enforcement

Steel sector

• $20 B market• 65% of respondents were manufacturers and

fabricators• 95% reported NCP in their market• 40% had been adversely impacted• Failure points: (with fabricators)

reliance on first party certification, building certifier resp. unclear and lack of complaints mechanism

Aluminum and glass sector

• $4 B market• 91% of respondents were manufacturers and

fabricators• 81% reported NCP in their market• 65% had been adversely impacted• Failure points: lack of a visible

regulator, reliance on first party

certification, building certifier role

unclear and fraudulent certificates

• $2 B market

• EWPAA market surveillance :70% of structural ply samples failed

• EWPAA “There is a total lack of enforcement. The system is there however regulators are not resourced and lack the will to act. The situation of NCP is not taken seriously and regulators do not act on complaints nor impose penalties.

Engineered wood products

• $2.7 B market

• No evidence of non-conforming product!

• Success factors: – high brand loyalty,

– product characteristics that local production,

– aggressive competition and

– a widely embraced third party certification scheme

Paint sector

• $2 B market• Non-conforming product - lead based stabilisers• Weaknesses:

- who is responsible,

- no complaints mechanism,

- no surveillance at point of sale,

- variation in consistency of certification,

- enforcement is post installation

Plastic pipes and fittings

WORKSHOP - The quest for a level playing field: The non-conforming

building products dilemma

• Education and communication

• Advocacy

• Research on international / national conformance frameworks

• Third party certification schemes

• Surveillance schemes

Workshop 26 March

• Forming a steering committee

• Low hanging fruit

• Resource availability

• Chipping away at the NCP problem

Current situation

Thank you

Contact: james.thomson@aigroup.asn.au

Phone: 0417 489 349