Some welcome news on building approvals but setback on IR Bill

There has been some welcome news for the construction industry as new ABS figures show some improvement in the building approval numbers for Victoria.

The data shows an increase of 5.4 per cent in approvals for new detached houses in Victoria during the three months to October 2023 compared with the previous three-month period.

Master Builders Victoria (MBV) has welcomed the latest building approvals data with CEO Michaela Lihou citing the latest ABS figures as a good sign for the industry which is continuing to slowly rebuild momentum after the challenges of the pandemic.

“While the positive gains might not be as fast as we might all like, there is no doubt that the signs are of an industry – and importantly consumer confidence – slowly rebuilding and moving forward,” she said.

It appears that the RBA’s pause on interest rate increases has given more confidence to home buyers to pull the trigger on building a new home prompting approval to rise to a five-month high with the total number of new home building approvals rising to 14,223 in seasonally-adjusted terms during October.

Renovations are also on the way up with the data showing an increase in Victoria of 3.5 per cent total volume in major home renovation works during the three months to October 2023 compared with the previous three-month period, and an increase of 6.9 per cent compared to October 2022 quarter data.

Ms Lihou said that as we continue building on this upward trajectory, it’s important that our key policy and decision makers recognise the potential damage to consumer confidence that future interest rate rises will have on our industry, and many others.

“It’s also important that the federal government fully appreciates the impact of its industrial relations Bill, and what we see as the potential damage it could inflict on independent contractors, subcontractors and self-employed trades.”

“Our industry is making slow but positive and important progress, and we can ill afford for it to be a case of ‘one step forward and two steps back’ thanks to bad policy,” she said.

Backing up her Victorian counterpart, Master Builders Australia chief executive officer Denita Wawn said that in what was starting to feel like Groundhog Day for bad government process, the government, with the support of some crossbench senators, had decided to ram through aspects of its IR “Closing Loopholes” Bill.

“Any remaining trust between the business community and the Albanese Government has today been eroded,” Ms Wawn said.

“The unions are today celebrating their Christmas gift while tradies and Australians who are grappling with a cost of living and housing crisis will foot the bill.

“The Albanese Government has failed to understand how building and construction work is performed.”

“If you’re a subbie like a brickie, a tiler, a sparkie or a plumber, you are now in the firing line, although we know they were not the intended target of this change, the government has still failed to hear their pleas.”