Building regulatory system

System description and objectives

The building regulatory system provides for the regulation of buildings, building work and various occupational groups in the building industry, and the setting of building performance standards.

Objectives

The building regulatory system seeks to achieve the following purposes, which are set out in the Building Act 2004:

• people who use buildings can do so safely and without endangering their health
• buildings have attributes that contribute appropriately to the health, physical independence, and well-being of the people who use them
• people who use a building can escape from the building if it is on fire, and
• buildings are sustainably designed, and constructed, and able to be used in ways that promote sustainable development.

The Act also describes the accountabilities of owners, designers, builders, and Building Consent Authorities – all of whom have responsibilities to ensure that building work complies with the Building Code, which is a key piece of regulation.

Building Act 2004(external link) — NZ Legislation website

Building Code(external link) — NZ Legislation website

In 2020, MBIE published the first iteration of the Building System Regulatory Strategy - Building for the Future. Building for the Future outlines MBIE's vision for the future of building regulation over the next 10 to 15 years and the actions MBIE needs to take to achieve that vision.

For more information and to track the building system’s progress against the Strategy, you can read about Building for the Future below.

Building System Regulatory Strategy

How the system works

Building work must meet certain requirements set out in legislation and regulations. These determine how work can be done, who can do it, and ensure that the system has adequate checks and consumer protection in place.

The requirements of the Building Act are performance-based, to allow development and innovation in building design, technology and systems. The Act applies mainly to the physical aspects of building work and establishes a framework for good decision-making, with checks and balances at each stage of the building or alteration process. The Act provides for:

• requirements relating to building work (the Building Code and building control)
• the functions of MBIE, Territorial Authorities, Building Consent Authorities (BCAs) and their accreditation
• licensing of building practitioners
• mandatory contracts and implied warranties for the benefit of consumers
• defined responsibilities for owners, designers, builders and manufacturers/suppliers
• guidance from the regulator.

A number of regulations provide detail for particular building controls. This includes the Building Code, which sets the minimum performance standards buildings must meet. It is set out in Schedule 1 of the Building Code.  Other controls set out in regulations include prescribed forms, a list of specified systems, definitions of 'change the use' and 'moderate earthquake', levies, fees and infringements.

Schedule 1 of the Building Code(external link) — NZ Legislation website

The Building Act works alongside other legislation affecting the building and construction sector, listed below in key statutes, and council bylaws.

Key statutes

Ministerial portfolio and key statutes

Regulatory agencies and their roles

MBIE is the lead policy advisor to government on the building regulatory system. It is responsible for advice on legislation and regulations, including the Building Code. The stewardship role requires MBIE to look across the system as a whole and provide advice on how to ensure the building regulatory system is high-performing.

MBIE is also the central regulator and manages the rules, procedures, and other key functions for regulating building work. It is responsible for:

• reviewing and maintaining the Building Code
• producing documents that show ways to comply with the Building Code
• monitoring the performance of Building Consent Authorities and Territorial Authorities in the building regulatory system
• investigating significant building failures where buildings failed to perform as expected and did, or could have, caused serious injury or death
• supporting the system under the Building Act for managing buildings affected by emergencies
• investigating complaints
• making determinations about disputes on certain building matters
• aspects of occupational regulation of some professions.

MBIE’s central regulator role is prescribed in section 11 of the Building Act.

Within MBIE the building regulatory system functions are located across two business groups – Building System Performance and Consumer Protection and Standards. This structure provides an appropriate separation between the strategy, policy and system design functions, and the operational compliance, assurance and dispute resolution functions. A memorandum of understanding (MOU) sets out the respective roles and responsibilities of the two groups and establishes governance arrangements.

A Building System Steering Group, comprised of the relevant general managers across both business groups, is responsible for strategic oversight of the building regulatory system, and the following outcomes:

• Achieving (and exceeding) the standards for the MBIE-wide objectives for regulatory stewardship
• Delivering confidence in the building regulatory system to the Minister, co-regulators, the sector and the public
• Applying an appropriate risk lens to functions across the system
• Performing its central regulator and stewardship roles with clear purpose, and with cooperation between participants for the benefit of the system as a whole.

Territorial Authorities and Building Consent Authorities (BCAs) are the frontline of the building regulatory system. They are co-regulators with MBIE, as they also perform regulatory functions, as outlined below.

The Building Act requires Territorial Authorities to keep records about all properties in their area, issue project information memoranda and certificates of acceptance, monitor compliance schedules and follow up notices to fix.

Territorial Authorities also have powers to address breaches of the Building Act. They can issue infringement notices or, in some circumstances, organise for remedial work to be done.

Territorial Authorities also have a role in managing buildings in their area after an emergency event.

Building Consent Authorities are responsible for:

• checking that applications for building consents comply with the Building Code and issuing buildings consents
• carrying out inspections to determine whether building work has been carried out in compliance with the consent and the Building Code, and issuing code compliance certificates certifying this
• issuing notices to fix, which require a person to remedy a breach of the Building Act or its regulations
• issuing compliance schedules, which set out maintenance and reporting procedures for specified building systems (such as cable cars or automatic sprinkler systems).

Most Territorial Authorities are BCAs. They may also contract these services out. Standards of performance are set out in the Building Act. BCAs’ performance against the standards is currently assessed by International Accreditation New Zealand (IANZ) on behalf of MBIE.

Collaboration and information-sharing between regulatory agencies

MBIE has a number of other regulatory functions that have relevance to compliance matters in the building system. MBIE has MoUs that document arrangements for sharing relevant information between regulatory functions when appropriate. The MoUs relevant to the building system relate to regulation of:

• Electrical Workers
• Licensed Building Practitioners
• Employment relations and employment standards, and
• Tenancy standards.

Regulated parties and main stakeholders

Regulated parties and main stakeholders include:

• Territorial Authorities (city and district councils) and Building Consent Authorities
• Professionals and tradespeople, including:
  • Licensed building practitioners
  • Electrical workers
  • Plumbers, gasfitters and drainlayers
  • Registered architects
  • Chartered professional engineers
  • Engineering associates
• Building owners.

Processes for engagement with regulated parties and stakeholders

MBIE is supported in its engagement with the building and construction sector by a building advisory panel (BAP), established under section 172 of the Building Act. The BAP provides independent specialist advice on current trends and issues affecting the building and construction sector. Under the BAP’s terms of reference, members meet quarterly with the purpose of:

• identifying emerging risks and opportunities to the performance of the sector, and advising on the regulatory response
• providing strategic advice on current and emerging trends in building design, building technologies and other factors that may affect the building and construction system
• providing leadership of the regulatory parts of the sector
• ensuring MBIE’s work programme and priorities create a regulatory environment that supports, and drives innovation in, the sector
• providing a channel for constructive dialogue between MBIE and the sector, and identifying critical stakeholders for engagement on specific initiatives.

BAP advice is complemented by other formal and informal ongoing collaborations with sector representatives and regulated parties; for example:

• Partnership with Engineering NZ: we collaborate with Engineering NZ to access technical expertise and develop strong relationships.
• Participation at Building Consent Authority and Licensing Board fora
• Regular stakeholder interactions to support user-centric design and best-practice consultation processes.

Construction Sector Accord

A Construction Sector Accord was launched in April 2019 to establish and communicate a joint commitment between government and industry that will support the sustained transformation of the construction industry.

In January 2024, the Minister for Building and Construction has directed repurposing of the Construction Sector Accord to specifically focus on sector engagement with a reshaped Accord Steering Group to support direct engagement on cross sector opportunities, and emerging issues and be convened 3 to 4 times per year to support direct engagement with Ministers. To support engagement on key portfolio priorities, the Minister asked to maintain leadership forums across infrastructure and residential sectors by using existing Accord Sector Reference Groups in the infrastructure and residential sectors.

System's fitness for purpose

Learn more about the fitness-for-purpose assessment and ratings

Building Regulatory Stewardship Self-Review 2021

An internal review of the regulatory stewardship practices across the building regulatory system was completed and published in early-2021. The review was intended to identify where there are areas of strength in MBIE’s stewardship of the regulatory system and to identify where practices can be improved.

It evaluated the maturity of the system and is intended to inform efforts to increase the maturity of practices over time. Work is underway to address the findings of this review, particularly with respect to three identified priorities areas – culture; governance, leadership and strategy; and insights and foresights.

Effectiveness

How well does the system support the desire outcomes?

Overall, the review found that the system is effective in achieving and supporting desired outcomes; but, there are aspects of the system where there is still work to be undertaken.

The review also acknowledged that there needs to be more work to understand how confident stakeholders feel about the system and that there is need to have a strategic and coordinated approach to stakeholder engagement. This includes ensuring that system outcomes and regulatory interpretation is communicated in appropriate ways in order to reach all and meet all the varied system participants’ needs.

Efficiency

How well does the system minimise costs and burdens, and maximise benefit?

The review found that the system is reasonably good at assessing and designing legislative settings to ensure a balance of minimising costs and burdens whilst maximising benefits. There is also still work to be undertaken to realise efficiencies with regulated parties and coregulators such as councils.

Resilience

How well does the system cope with changing circumstances and pressures?

The review considered the maturity of the system’s ability to cope with changing circumstances and pressures to be mixed but could broadly be described as defined and evolving.

Fairness and accountability 

Is the system proportionate, fair and equitable in the way it treats regulated parties? Is it transparent? How does the system enable and support people from marginalised communities?

The review noted that the regulatory impact analysis for changes to the building system is robust, suggesting that changes made to the system are likely to be proportionate, fair and equitable in the way they treat regulated parties. Further to this, the review noted that there is evidence of efforts to make the system more transparent and accessible.

The review considered that there is a range of ways to consider how well the system supports communities. The requirement for safe, durable, healthy and sustainable buildings for all building users is embedded within the core purpose and principles of the Building Act. Similarly, the outcomes for the building system in the Building for the Future strategy include:

• Social wellbeing: Buildings support the health, safety and wellbeing of people and communities in a changing environment; and
• Environmental Wellbeing: New Zealanders, whānau and communities create and live in sustainable buildings that meet the needs of present and future generations.

Next review date: TBA