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Cladding fast track concerns

08 Jul 2020

By Meg Hill

The state government has announced that its plan to fix flammable cladding will be fast-tracked, with the number of buildings rectified per year doubled.

The government’s $600 million plan to fix flammable cladding was originally designed to rectify up to 100 buildings per year.

However, on June 23 the government announced the program would be accelerated, with work to start on up to 400 buildings within two years.

The plan involves Cladding Safety Victoria (CSV) working with selected builders to rectify their projects at no profit. Minister for Planning Richard Wynne said participating builders would have to pass rigorous tests.

“Only reputable builders will be eligible for the accelerated program. Those found to have done the wrong thing will not be able to participate,” Mr Wynne said.

“This is a chance for the original builders to become part of the solution and keep their workers employed during these challenging times.”

Paul Morton, CEO of Lannock Strata Finance, said he welcomed the state government’s proposed fast tracking of cladding rectification.

Lannock Strata Finance lends loans to apartment owners in need of covering the gap between government assistance and the total cost of cladding rectification.

“Many owners are facing difficulty in obtaining personal finance or increases to their mortgages in order to be able to fund a special levy to pay for cladding repairs,” he said.

“For owners living in properties that may not be compensated, Lannock provides a viable and immediate funding alternative. We can finance the works immediately without a single owner having to increase their mortgage.”

“Later on, if their property does qualify for government assistance, owners’ corporations (OCs) can use these funds to repay the strata loan early. Being able to proceed with cladding repair works quickly also restores value to each individual property.”

But some experts have raised doubt about the program.

Strata Title Lawyers CEO Tom Bacon said the problem was the actual resourcing of CSV.

“The announcement made by the Victorian Government is an incredibly ambitious proposal, and most likely done with the best of intentions,” he said.

“Unfortunately, CSV has not been resourced properly by the Victorian Building Authority (VBA) and by the Victorian Government, and that is why we have seen significant delays in commencing the pilot project with even the first 15 buildings struggling to get under way.”

“So, the proposal for 400 buildings to get underway within two years is going to require either significant additional staff numbers and resources being added to CSV, or it is going to require significant trust being extended to builders and project managers to undertake the works proactively and with little red tape.”

Mr Bacon said it was the latter – pro-active work with self-certification and little red tape – that led to the cladding problem in the first place.

Apartments owners have also reacted hesitantly. We Live Here president Barbara Francis said it was a “knee-jerk reaction from a government under siege, trying to look as though they are doing something”.

“How will the government’s proposal actually work, and at what cost?” she said •

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