South Australia’s Local Government Association wants to protect ratepayers from subsidising the potential $4.5 million cost of revised State Government building inspection regimes, which come into effect as of 1 July this year.
As a result of concerns regarding the quality of the frameworks and trusses supporting roofs, the new State Regulations require councils to inspect 66percent of buildings constructed by licensed builders and 90percent by owner builders. Currently councils inspect approximately 20 percent of buildings with the cost of inspections covered by application fees. South Australia’s LGA is concerned that the increase in costs will be passed on to ratepayers.
According to LGA President, Mayor Kym McHugh, “These increased inspections will have to be paid for and the only way this can happen is if the Government increases building inspection fees or provides direct funding to councils. If no action is taken the Government will force ratepayers to pick up the bill.
“We estimate that Councils may have to conduct an extra 13,000 building inspections across South Australia and, at the current cost of $230 per inspection, a conservative estimate of the increase in costs to councils will be between $3 million and $4.5 million each year.
“The Government has indicated that it is looking at the issue and councils are currently putting together their 2012/13 Budgets and, with July 1st looming, councils are becoming increasingly concerned as there is no assurance that fees will be increased in time.”
The South Australian State Government sets application fees under the Development Act, with current fees already subsidised. The LGA had raised the cost issue during negotiations over the new Regulations, arguing that the increase in building inspections required under the new regulations would exacerbate an unfair system.
As Mayor McHugh pointed out, “We think fees are the best funding mechanism because inspections primarily benefit the builder, owner or buyer of the building or their guests and it should be user pays, not every rate payer or tax payer being slugged with these costs.”
“Past cost shifting has an ongoing impact on council ratepayers and under an national inter-government agreement and a State Memorandum of Understanding between the Premier and the LGA, the State is meant to negotiate funds for costs shifted on to councils in advance.”
