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Welcome to the Builders Collective of Australia
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Written by Administrator
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Monday, 18 August 2008 14:21 |
WANT TO RENOVATE OR BUILD IN AUSTRALIA? HOW WELL ARE YOU COVERED IF YOUR BUILDER DOES NOT PERFORM? MANAGING RISK – AUSTRALIAN HOME OWNERS WARRANTY INSURANCE Best practice in the Australian Building and Construction Industry - A State of Origin, head to head comparison of the NSW Suncorp-Vero/HIA consumer protection scheme compared to Queensland’s BSA scheme Prepared by Builders Collective Australia http://www.builderscollective.org.au NSW Scheme | QBSA Scheme | | New South Wales scheme overseen by Office of Fair Trading and operated privately by Suncorp/Vero Insurance Company | Queensland scheme operated by the Queensland Government through the Building Services Authority | | Last Resort Policy Maximum payout out $300,000 but limited to 20% of the original contract value for non – completion Comments sourced from the OFT web site at: http://www.fairtrading.nsw.gov.au/ | First Resort Policy Maximum Pay out $400,000 No limits! and includes the effects of subsidence or settlement Comments sourced from the BSA website at: http://www.bsa.qld.gov.au/Home/Default.htm | | Comment: Only applicable if the builder dies or goes bankrupt and triggered only after all civil legal proceedings have been exhausted. | Comment: | REVENUE and CLAIMS | | Policy cost, house value $200k: $3,209 Policies written: 40,000 Revenue: $45,000 Claims accepted ratio 7% Premium-to-claim ratio: 7% Average time problem rectified:4 years | Policy cost, house value $200k: $1,580 Policies written: 93,166 Revenue: $50,074 Claims accepted ratio: 98% Premium-to-claim ratio 85% ?? Average time problem rectified:6 mth | | | | Increase 9.4% | Increase 45% | MINISTER RESPONSIBLE | | NSW Fair Trading The Hon. Linda Jean Burney | QLD Housing Minister Hon. Robert Schwarten | OTHER COUNTIES and STATES | VIC, SA, WA, NT | Tas (Voluntary)
Last Resort Dropped 2008 | WHEN THINGS GO BAD - A HEAD TO HEAD COMPARISON | “Beechwood Home Collapse”
13th May 2008 | “Real Property Constructions (RPC) Collapse”
8th Feb 2008 | GOOGLE METER (“RPC/Beechwood builder collapse” of search results @ 17th August 2008) | 1450 | 237 | TIMELINE | Beechwood Homes Day 0 - 13th May 2008 Impact - 300 un-completed homes and 400 deposits paid | Real Property Constructions Day 0 - 8th Feb 2008 Impact – 233 un-completed homes and 87 deposits paid | | Day 1 – (14th May) Minister Burney urged clients of Beechwood not to panic following the news the company had gone into voluntary administration. Ms Burney said the administrator will know in 2 or 3 weeks time if they can find another builder to complete projects or return deposits. If they can’t then home owners will be able to lodge a home warranty insurance claim. | Day 1 – (9th Feb) The BSA opened across the weekend with 26 staff to contact affected consumers and advise them BSA administers an insurance fund (called the “Queensland Home Warranty Scheme”) which provides a benefit for specified losses associated with a contractor’s failure to complete a contract. If work has commenced, the insurance benefit is, (subject to the terms and conditions of the policy), equal to the cost to complete the works, less any moneys you are still holding under your contract. If work has not commenced, the insurance benefit is limited to, (subject to the terms and conditions of the policy), a refund of deposit paid. | | (Day 2) 15th May Vero has recognised the company as insolvent following the appointment of a receiver. Vero regards this as the trigger for consumers to lodge claims for home warranty insurance a claim under the Home building Act. Note: This is a unique precedent and hundreds of other claimants over the years ask why this has not been applied to them? | | | (Day 3) 16th May. Minister Burney calls for calm “It is important that anyone with a contract with Beechwood Homes does not cancel it. | | | (Day 10) 23rd May. “Progress is being made to find a buyer to take over the Beechwood contracts. “In the event that Beechwood is not sold, the home warranty insurer Vero has indicated that it is ready to get on with the job of having the homes completed”. | | | (Day 11) 24th May Beechwood home buyers told not to pay progress payments Ms Burney criticised the receiver for issuing progress payment bills to home owners…… Pay up or else, victims told Consumer meeting Anguish hits home ……. No one to call when roof falls in The controversy over "worthless" mandatory home building warranty insurance rages….. NSW govt's Beechwood handling under fire Insurance threat driving builders away Bills stop for builder's victims | | | (Day 13) 26th May. Ms Burney said that Vero has sent claim forms to all Beechwood Homes policy holders last week. “My office has been in contact with Vero about having these claims processed as quickly as possible,” Ms Burney said. | | | (Day 18) 31st May Beechwood bell tolls for everyone One South Coast concreter and a plumber are owed $500,000 each………. Questions over $200000 claim paid to Coonan | | | (Day 20) 2nd June I know that the families who have suffered from the collapse of Beechwood are experiencing awful stress,” Ms Burney said. “I want to reassure people that rectifying the situation will take a bit more time but it will get sorted.” | | | (Day 21) 3rd June Beechwood victims told to wait VICTIMS of the collapsed building company Beechwood Homes face a further three- to four-week delay in the resumption of construction of their homes because ... Buyers line up for Beechwood | | | (Day 27) 9th June Senate attacks housing's 'junk insurance' scheme With the HIA’s Ron Silberberg dismissing the inquiry as a "kangaroo court". Rebuff for Senate on building insurance | | | (Day 28) 10th June Hundreds more may be hit by collapse Being those 580 that were having plans done at a cost of between $2,500 & $5,000 by Beechwood but without a contract or warranty in place so no insurance applies | | | (Day 29) 11th June Choice urges states to overhaul home warranty insurance | | | (Day 35) 16th June Insurance a poor deal for home builders
While the accepted premium-to-claim ratio for most consumer protection insurance is between 65 and 80 per cent, under the home-building warranty insurance scheme it is only 7% | | | (Day 38) 19th June Receiver rejects call to release home plan VICTIMS of the Beechwood Homes collapse seeking to cut their losses and start from scratch have been told by the company's receiver they do not own the house plans they have paid for. | | | (Day 54) 6th July 2008 Beechwood sale still up in the air UP TO 1000 families and builders remain uncertain about the future of collapsed builder Beechwood Homes. | | | (Day 60) 12th July 2008 Beechwood homes victims get ray of hope
Sydney Morning Herald
HOME OWNERS and creditors connected to the collapsed housing company Beechwood Homes were given a flash of hope yesterday with an administrator's report ... | | | (Day 69) 21st July 2008 Beechwood sale deadline not today: Govt
ABC Online - Australia
The New South Wales Government has rejected reports collapsed building company Beechwood Homes will be liquidated if it is not sold by close of business ... | | | (Day 76) 28th July 2008 Beechwood Homes site reopens for business
Sydney Morning Herald
Beechwood Homes's site at HomeWorld in Kellyville was reopened for business yesterday.. | | | (Day 77) 29th July 2008 BEECHWOOD Homes, the collapsed NSW home-builder, has been sold to a family-owned business, Cavasinni Constructions. Beechwood receivers Deloitte today said the business had been sold for an undisclosed amount with all assets, including existing land, buildings, contracts and copyright.
It will be sold as a going concern to Resibuildco, which will be funded by Cavasinni Constructions and the Cavasinni family.
The business will continue to trade as Beechwood. | | | (Day 78) 30th July 2008 Beechwood homes in new hands... Cavasinni Constructions has bought the assets of the collapsed project-home building company Beechwood. | | | | (Day 87) 6th May About 70% of clients affected by the failure of Sunshine Coast-based Real Property Constructions have had their homes completed or deposits refunded. Mr Schwarten said all 207 complaints received by the Building Services Authority about RPC had been assessed and 140 finalised. “There are 35 jobs currently out to tender and another 13 have been sent to quoting builders,” he said “Homeowners affected by RPC’s collapse just three months ago, the BSA has done a great job in finalising about 70% of people’s claims.” Mr Schwarten said the value of claims under the warranty insurance scheme to date was $1.9 million. http://www.thedaily.com.au/news/2008/may/06/relief-clients-rpc/ | | (Day 94) 15th August 2008 Beechwood contractors attack receiver's secrecy The creditors of Beechwood will get nothing from this failure of $74.6 million, and they have every right to know what this entity was sold for as does the Senate Inquiry who is inquiring into Australia's Mandatory Last Resort Home Warranty Insurance Scheme as this sale is replacing the very warranty scheme the Senate is inquiring into. | | Comment Now that Beechwood has been sold it would appear the warranty insurance scheme will not apply in this instance and the homes will be finished under the existing contracts. If this is the case that may be a great scenario for the consumers if their homes are finished for the original contracted price, however that outcome remains to be seen as contracts are yet to be assigned and works are yet to start, and we certainly have no idea when they will be finished as some of the HIH collapse consumers are still waiting after 7 years. The QBSA failure on the 8th Feb 2008 saw the instant implementation of their first resort warranty scheme and after only 12 weeks saw 70% of consumer claims satisfied. This is the scheme we have been advocating since the HIH collapse that the building community is still paying for. The insurance industry could not even take responsibility for their own failure! In an industry big enough that we measure the fiscal health on the nation on we are being made look as though we are all a bunch of rat bags, incapable of managing our industry and providing basic consumer protection in a timely manner such as the holistic Qld scheme Both NSW and Victoria jointly introduced this BWI scheme back in 2002 and appear to have an obsession to maintain the status quo in the face of overwhelming evidence of its failure to provide anything like appropriate consumer protection let alone anything that resembles reasonable industry management so it would appear there can only be one conclusion and that is that possibly others are benefiting from its being, and this is why the Senate inquiry must compel Vero and HIA to appear before a public hearing The responsible NSW Minister is the Hon. Linda Jean Burney who has stated on numerous occasions that NSW has an effective consumer protection framework which delivers protection for consumers who are faced with the collapse of their builder’s company. Thank you Minister, but where is that effective warranty insurance protection? The Current Senate inquiry should represent both the consumers and builders of this nation in this most serious of matters that has seen suicide, financial failures, and family breakdowns suffered by thousands of Australians, and yet the major supporters of the current arrangements number only 2 from the big end of town being Vero Insurance and the Housing Industry Association and they have refused to appear before the Senate inquiry with the latter referring to the process as a kangaroo court. This vexed and controversial issue has seen over 30 inquires and reviews in the past 10 years plus the Productivity Commission inquiry handed down recently that described this warranty as a running sore and now we have the Senate Inquiry that as yet has not compelled the two pivotal players to appear before the committee at a public hearing. The Builders Collective of Australia (BCA) is the amalgamation of all the various groups around the nation that formed in 2002 to fight the introduction of the Last Resort scheme and consisted of the NSW Be-Fair builders group, the Builders Collective, Home Warranty Action Group (HWAG) from the Illawarra region, the Central West Home Builders Scheme (CWHBS) from Orange, and The Housing Indemnity Action Group (HIAG) together with the Builders (WA) mutual Fund Limited (BMFL) both from Perth which had preliminary approval from the WA Government for this proposed Mutual at this link www.buildersmutual.com.au that was successfully scuttled by the Housing Industry association in favour of the Last Resort scheme we have today. Consumers have now joined forces with the BCA to present a united front that will ensure reform of the consumer protection and industry management of the Australian Building Industry. The Builders Collective of Australia Working for a better Building Industry http://www.builderscollective.org.au 0414 699 905 |
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Last Updated ( Monday, 18 August 2008 18:50 )
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Written by Administrator
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Tuesday, 15 July 2008 00:00 |
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Hello and welcome to the Builders Collective of Australia. The Builders Collective of Australia is a not for profit organisation formed in 2000 to combat Last Resort Home Owners Warranty. After so many years, of so many Australian home owners, builders, trades and suppliers being blatantly rorted by this government scheme (excluding the Queensland and Tasmania State Governments) you have to ask why does Last Resort Home Owners Warranty continue? With all the media articles of people suffering and all the government inquiries - simply tell us why we need it if there is no consumer or industry benefit? You have to ask who benefits and where do the hundreds of millions of dollars in fees go? Is there any clearer example of how poorly this scheme works then to look at the Beechwood Homes fiasco versus what would have happened had the builder collapsed under a Queensland type Home Owners Warranty program. The more people understand the issue the more they are incensed. Catherine Cusack, NSW Opposition Minister for Fair Trading has just launched a dedicated website here on the issue. Surely government is in position to change poor policy when it provides little or no benefit or support to consumers or the industry - we wait for the current Economic Senate Committees report. If you feel passionately about the issue then please add your comments below and spread the news - every article on this web site has social book marks to help you spread the word. Email to your associations, politicians and media to let them know what you think. It is time to hold whoever makes decisions (to act or not act) on this issue to social account In the next week we will begin publishing an updated list of every politician, relevant public servant and industry association president and their stated position on the issue - "Are you for the immediate dumping of Last Resort Home Owners Warranty?" If you have a video camera then put your story on youtube and we look to add it to the playlist - please keep it short and to the point. If you write a blog or want to share some information then let us know. If you find an interesting news article then send us a link or create a Digg profile (news sharing and comment service) and become a BCA friend. There has been plenty of opportunity to change policy. How many more people have to suffer? It's time to do something about it - comment below and share your thoughts. Phil Dwyer
President
Builders Collective Australia
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Last Updated ( Tuesday, 15 July 2008 08:40 )
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Written by Administrator
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Wednesday, 16 January 2008 00:00 |
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Today marks a watershed in our fight to get Last Resort Builders Warranty scrapped. Tasmanian Minister for Justice and Deputy Premier Steve Kons today announced the end of last resort Builders Warranty insurance in Tasmania. Download the official press release here. HIs condemnation of this product was scathing, and to quote the official Government press release: - "A legislatively mandated scheme of last resort insurance is simply not good enough for Tasmanian consumers
- Replacing it will be a new statutory framework, which will include a program allowing the resolution of disputes between consumers and builders as an alternative to the courts.
- This insurance does not provide the resolution or security that people expect nor peace of mind.
- Mr Kons said while he expected the insurance industry to be critical of this decision, the State Government was acting in the best interests of consumers."
Steve Kons has today shown genuine leadership on behalf of the Tasmanian community by refusing to be railroaded by the insurance industry and their commission agents. For this he is to be commended and congratulated. It now remains for the other States to drop their ill-advised support of this failed scheme and to step up beside Mr Kons in support of all Australian builders and their clients by scrapping Last Resort Builders Warranty once and for all. The Builders Collective of Australia will continue to support all who act with justice, equity and fairness. We will never compromise these great values as we move towards complete removal of Last Resort Builders Warranty Insurance from our industry. If you want to tell Mr Kons how you feel about this announcement then please
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Last Updated ( Monday, 02 June 2008 12:17 )
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Written by Administrator
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Wednesday, 02 January 2008 00:00 |
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It would appear our long held concerns are largely shared by the Federal Government Productivity Commission and an excerpt of recommendations in their long awaited report into Consumer Protection appears below: - Guaranteed access for consumers to alternative dispute resolution mechanisms
- Provision of greater scope to de-register builders who do not meet appropriate performance standard, and
- Revamping of compulsory builders' warranty insurance to ensure that it is of genuine value to consumers and that consumers understand the product
Australian Governments should take early action to provide better and uniform protection for those having a home built or renovated. Specifically, this should entail: Draft recommendation 5.5 More importantly the matter is now clearly a Federal issue and we can expect and have already received assistance and support from the new Federal Government. No longer can a Federal Government fob off the issue as a State problem. It is as we have always said, a National disgrace that requires a unified and integrated National solution. The full draft is at this link: We now have the opportunity to submit further concerns and refinements to the productivity Commission prior to their final document release in March 2008. Builders Warranty was, is and remains a farce on the Australian Community Even in the face of high profile opposition, The Builders Collective membership still remains commited, with the help of influential reports such as this, to see this disgraceful product removed from the market once and for all. |
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Last Updated ( Monday, 02 June 2008 12:05 )
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Written by Administrator
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Wednesday, 16 January 2008 00:00 |
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Today marks one of the most significant moments in our fight to remove last resort Builders Warranty Insurance from the Australian consumer protection landscape. Senator Christine Milne (Green) put the motion at this link to the Senate today calling for a Senate Inquiry. The motion was passed with the full support of the Government, the Liberal Party, Greens and Democrats. The powers of a Senate Committee are wide ranging and will ensure that this inquiry will be like no other inquiry ever before conducted. The full list of standing orders are at this link for those that are interested: The Builders Collective of Australia congratulate all Senators for standing up for the community interest on this issue and we look forward to working with the inquiry over the coming weeks. Thank you for your support and we will keep you informed of developments as they occur. |
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Last Updated ( Monday, 02 June 2008 12:32 )
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