A Margin of Error

March 3, 2015

Published BREGs Blog, March 2015

 

How is it that we are blind to the mistakes of the past and why, in recent statements on building certification, is Minister Paudie O’Coffey unconsciously creating the same conditions that were the root cause of what he is trying to fix?

 

‘Mistakes of the past’ was a phrase that, not surprisingly,  got a lot of airtime at the joint National Housing Conference this year: but this maxim is dangerously beguiling; it suggests that the mistakes are in the past.  It lets us imagine that we all lost the run of ourselves a bit back then but that now we are clear headed and far sighted, the better for having being involved in such an apparent error.

 

… most importantly, It makes us blind to the mistakes that we are making right now.

 

I listened with interest to the Minister’s address to the conference. In it he made a comment directly to those present; “consider your margins”. My first thought, as an architect, was; I think developer’s margins are pretty tight these days, which is why they are not developing. Then it occurred to me – wait a minute, does he mean us?! The idea of an Architect actually making ‘a margin’ was so alien that I had immediately assumed the comment was not meant for the room full of architects. Since 2008 architectural firms have been bidding for work, particularly public sector work, at such low fee levels that the margins have been, in many cases, negative – practices have been burning up cash reserves in order to ‘keep the show on the road’.

 

So far, so sob-story. The problem facing the minister now is one of output – not put-out architects. But in attempting to encourage the market conditions that will increase construction and housing supply, the minister has a number of cost-base challenges – one of which is the emerging cost of his predecessor’s BC(A)R legislation. The problem is best illustrated in the self-build and one-off housing sector. Minister O’Coffey, in response to a parliamentary question last week, stated that  certification under BC(A)R for a one-off house “… should cost no more than €3,500″. The Royal Institute of Architects in Ireland (RIAI) have calculated, based on what the legislation and the code of practice says, that the role of certifier for a one-off house would entail approximately 150 hours over and above any ‘traditional’ architectural service. Taking an allowance of zero for the liability the architect is taking on board for signing-off the building, and based on time alone, this puts an architect’s hourly rate at no more than €23.

 

But pitching the RIAI and the Minister’s own estimates against each other is not the point. Among the mistakes of the tiger era was the cultural idea that because, through building, landowners and speculative investors were creating jobs, construction activity, raising property prices and tax revenue, it was crucial to the economy that they should be allowed to build with as little interfering red-tape (and associated costs) as possible; Planning Permission was more than enough restriction for something as straightforward as houses. This meant, in practice, employing as few ‘consultant’ building professionals as possible with as limited a scope as possible – especiallyin housing. Well over 80% of the houses built in this period did not have a ‘full’ service from an architect. Most were certified by a one-time visual inspection, after everything was finished and all of the work was closed up. This may not have been very effective, but it was certainly cheap.

 

In retrospect, it is a testament to the building industry that Priory Hall was the exception rather then the norm.

 

The BC(A)R legislation is conceived to make this model of laissez-faire, pro-development and, above all, cheap certification impossible. Despite press releases from Phil Hogan in 2013, suggesting that the legislation put an onus on building professionals “to provide a more complete service”, in fact the onus falls squarely on the would-be developer to hire somebody to provide a more complete service to them.

 

The housing supply crisis is real, and the Minister rightly needs to challenge all of the costs that are effectively putting a brake on development. Certification is just one of these costs: Here we have the dilemma, and the unwitting repeat of our past ‘mistake'; in stating that the cost of building certification should come down, the minister either believes that certifiers should work for less, or that there should be less work for certifiers … that is, less paperwork, less inspections, less time on site, less oversight.

 

If we really do need cheaper building certification, the solution can only lie in reviewing what level of professional service and certification the new Building Control Legislation requires a developer or self-builder to buy.

 

Since this piece was written it appears that Minster Alan Kelly has decided to take a broom to the complexity of the regulations as they apply to one-off and self-build houses. A very welcome and appropriate initiative – I look forward to outcome of the proposed review. 

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