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Last Updated:
Apr 24, 2009 - 5:31:05 PM |
National Consumer Agency (NCA) publishes study on the Irish home construction industry and the consumer in Ireland
By Finfacts Team
Nov 24, 2008 - 1:00:54 PM
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The National Consumer Agency (NCA), which is likely to become a unit of the Department of Enterprise, Trade and Employment, as part of a plan for public reform that is moving at glacial speed, today published a study on the Irish home construction industry and the consumer in Ireland. This is the first time that such an exercise has been conducted from the perspective of the Irish consumer. The study, which was carried out for the NCA by chartered accountants Grant Thornton, examines the protections available to consumers when buying or upgrading a home.
The study makes 25 recommendations in total and proposes that the NCA establish an Implementation Forum involving all relevant stakeholders, to progress and implement the recommendations swiftly and efficiently.
Detailed research reports examine insurance, information provision, legal & conveyancing matters, building regulations and professional services, with the sixth module presenting measures of consumer detriment in this area. Summary findings of the research are presented in an overview document, supported by six reports, reviewing existing practices in the industry and evaluating the Irish situation relative to international best practice.
Amongst the key recommendations are:
- The existing system of Opinions of Compliance with the Building Regulations should be replaced by a statutory backed system of Certificates of Compliance. Under the proposed new system, all sub-contractors on a particular project would be required to sign off that they had completed their work on the project in accordance with the building regulations, thus enabling the contractor to sign a Certificate of Compliance. This proposal brings the residential sector into line with the approach adopted for commercial buildings. It is proposed that this system would be underpinned by a rigorous audit process carried out by Building Control Authorities.
- Industry bodies, with the NCA, should develop a simple, standardised contract for small domestic building works; consumers should ensure that their rights are protected by having a contract in place when carrying out refurbishments.
- Industry bodies, with the NCA, should develop improved dispute resolution procedures that take consumers’ interests into account.
- The limit of €200,000 which applies to the structural guarantee scheme operated by Homebond should be reviewed, as should the scope of the scheme.
- The NCA should support the provision of easily accessible and accurate online information on the home construction industry to consumers.
“Buying a house or renovating a home are the single biggest purchases that most consumers make in their lifetimes and we wish to ensure strong representation and protection of their interests across all areas of the home construction industry,” said Ann Fitzgerald, Chief Executive of the National Consumer Agency. “It is clear from the Grant Thornton report that much needs to be done to ensure that consumers rights are protected.
“We are calling on all stakeholders to join the proposed Implementation Forum to ensure prompt progress is made on the recommendations.”
“Our research shows that home improvements is a greater area of consumer detriment than in new dwellings,” she said. “This leads us to conclude that particular aspects, such as consumer awareness and education, as well as the need to put such works on a proper contractual basis are essential. It also suggests that industry itself has a role in promoting better standards of customer service, given that such problems are readily addressable.”
Fitzgerald concluded, “One of the biggest issues facing consumers is the lack of information around the whole complex area of home construction, property purchase and ongoing care and maintenance issues. Many consumers struggle with the range and magnitude of information required to make informed decisions. Without consumer friendly guides to explain rights and responsibilities around building regulations, home insurance, contracts and where people can go for redress, consumers are going to suffer financial detriment. Our goal is to reduce such detriment to consumers, by filling the information void and by working with the industry to address relevant issues, ensuring that consumers get a fair deal.”
The Construction Industry Federation (CIF) has welcomed the report.
Responding to the publication of the Report, Hubert Fitzpatrick, CIF Director of Housing said: “The Report finds that there is a high level of consumer satisfaction particularly when measured against similar studies in the UK. The Report finds however that there are areas where further improvements are necessary. On a number of these issues the NCA is clearly moving towards the CIF’s position and we welcome this”.
“The Report recommends, for instance, that the practice of stage payments should be abolished. Two years ago the CIF banned this practice for its members. The Report also recommends that consumers have a proper snag list prepared in advanced of taking occupation of their new homes. Again CIF has strongly advocated this and there is no doubt that properly prepared snag lists greatly reduce the possibility of subsequent difficulties and misunderstandings arising”.
“The NCA makes other recommendations in relation to building regulations and, as an industry body that works very closely with the relevant regulatory bodies on issues such as a building regulations, this recommendation is very useful. However, we must bear in mind that compliance with building regulations is a statutory requirement for industry and that this must be certified by professionals prior to closure of sale of any new home. The Department of the Environment also issues Floor Area Compliance certificates in respect of new homes under 125 sq metres which requires compliance with all requirements for new houses and apartments. Building Control Authorities also have enforcement powers to deal with any cases of non compliance where warranted.”
“The CIF has operated the Home Purchase Protection Pledge on behalf of its members, which prohibits the practice of gazumping, for a number of years and earlier this year published a code of practice for members in relation to management companies. Earlier in the year also the CIF launched a new information website for home buyers, http://www.homefacts.ie/, dealing with issues such as builder responsibilities, snagging lists, guarantees and warranties, energy ratings and management companies as well as information on stamp duty, mortgage interest relief, the rent-a-room scheme and on the buying process.”
“The Report finds householders tend to be less satisfied when it comes to domestic renovations and extensions. The CIF strongly urges consumers to use reputable builders who have a demonstrable record of good workmanship and to thoroughly check all references. In the run up to the budget, the CIF announced that it is preparing a register of competent contractors who can provide a ‘one-stop’ service for householders who want to improve the energy efficiency of their homes. We also announced that, in line with Government supports in this area, the CIF would be developing a form of contract to be used by householders when undertaking such work and that a guarantee scheme, like the HomeBond scheme for new homes, should be put in place”.
“As we always have done the CIF will continue to work with the Director of the NCA on all of these issues. An objective of the CIF is to improve the standard of house building and to support reputable companies operating in the repair and refurbishment sector”.
© Copyright 2009 by Finfacts.com
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