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Contractor (September 2012) NZ National Standards Funding Needs Revision

04 Sep 2012

Rob Gaimster
Cement & Concrete Association (CCANZ)

New Zealand National Standards are a vital element in the concrete industry and wider construction sector.

They are developed through a consensus, industry focused process to produce outputs that guide best practice, define performance parameters and provide a means of compliance through the nexus of the construction related regulatory framework.

However, their current funding mechanism is less than equitable, and is in need of examination and adjustment.

MBIE REVIEW

The Ministry of Business, Innovation and Employment (MBIE) is undertaking a review of New Zealand’s standards and conformance infrastructure, with a specific focus on the National Standards system.

The purpose of the review is to develop proposals for a viable and well functioning Standards system that meets the needs of business, regulators, and consumers into the foreseeable future.

There are a number of factors that have given rise to the review, in particular:

  • The regulator carrying out functions that have traditionally been carried out by the Standards Council.
  • The need to evaluate whether New Zealand’s Standards system is best-placed to meet the needs of businesses, consumers and regulators.
  • The importance of international trade to New Zealand’s economic growth and prosperity, and the increasing role of Standards in facilitating trade.
  • A belief that the current Standards Council business model, incorporating its operating arm Standards New Zealand (SNZ), is unsustainable.

WHAT IS A STANDARD? 

As outlined by SNZ, National Standards are agreed specifications for products, processes, services, or performance.

They help to keep us safe within our built environment, as well as prevent accidents and injuries in a broad range of areas, minimise the impact of potential natural and man-man disasters, and improve the quality of goods and services.

Standards also play a crucial role in protecting the environment, and boosting our economic growth and our trade opportunities in existing and new markets.

From a construction sector perspective, Standards provide acceptable solutions and verification methods to the Building Code, and are therefore used in specifications for design and construction practice, and the manufacture and testing of products and materials.  As Standards also represent codes of best practice, specifiers tend to rely on these documents for technical detail.

STANDARDS DEVELOPMENT

National Standards are developed (and updated) by expert committees using a consensus-based process that facilitates public input. Such open transparency across a range of stakeholders is a key strength.

The development process also manages any potential vested interests of individuals or groups through an overriding emphasis on technical and practical considerations, plus the umbrella strategic needs of the collective industry.

Key to the robustness of this process is that the regulator (Department of Building Housing / MBIE) is simply another seat at the table, rather than executive authority.

STANDARDS FUNDING

Yet despite the strengths of the National Standards development process its business model is inappropriate, at least for the development of Standards related to the New Zealand construction sector.

This is most evident in that the robust development process relies almost exclusively on the ‘volunteerism’ of conscientious professionals from within the relevant industry.  In the majority of instances, these individuals give freely of their time, without recompense or acknowledgment from their employers.

As businesses and academic institutions are squeezed in the pursuit of efficiencies, the freedom with which individuals can offer their resource in the Standards development process is under pressure. This is a major factor to the backlog of Standards requiring review.

An additional concern relates to the accessibility of Standards. Currently SNZ charges users to access Standards, either in electronic of hardcopy formats, which is a barrier to their use.

Issues around funding can also be detected in the time with which it takes the regulator to reference a new or revised Standard as part of the Building Code.

In light of the significant role played by Standards to the ‘public good’, along with that of commercial interests, it does not seem unreasonable to suggest that they be either wholly or partially funded through Government.

A viable funding option, at least for Standards that relate to the construction sector, is that a portion of the Building Levy be diverted towards their development and implementation.  

THE WAY FORWARD

There is no doubt that New Zealand National Standards are used by a diverse range of organisations to enhance their products and services, improve safety and quality, meet industry best practice, and support trade into existing and new markets.

They are crucial as the main means of compliance with the Building Code, and represent a system internationally recognised as workable. 

Yet their funding mechanism is outdated in the current economic environment, and struggles to accommodate the time, cost and complexity demands of updating them as often as required.

As the MBIE progress with their review it is imperative that the importance and independence of National Standards be acknowledged, and that an alternative, equitable and sustainable funding mechanism is identified for everyone’s benefit.

Article appeared in Contractor magazine.