EP 93 · Yarns with Andy

Christian van der Pump

Hosted by Andy Alagappan
RegulationBuilding ActConsentingFire EngineeringMicroeconomicsMonopolyProducer StatementsMbie DeterminationsLaw ReformConstruction CostAustraliaPerformance Based Design

About This Episode

Christian van der Pump is a principal fire engineer at Kirk Roberts with an unusually assembled toolkit, chemist, microeconomist, former volunteer firefighter, self-taught in constitutional and administrative law, and holder of a PhD titled Market and Regulatory Failure in Fire Protection Engineering. This is the most technically legal episode in the back catalogue, and its argument is single-minded: the reason it costs roughly $5,000 a square metre to build in New Zealand is the Building Act and the way it is administered, not the RMA that absorbs all the political attention. His diagnosis is a microeconomics one, monopoly control over the supply of building consents. If a council says no and the right answer is yes, there is no competing authority to go to; a council is judge, jury and executioner, and section 392 immunises it from liability whenever an applicant follows the prescriptive "cookbook," which is precisely why nobody innovates. The second half is a transferable playbook: how he took four papers to Parliament (three reaching Cabinet) via petitions and select committees, forced a rebuild of the MBIE determinations system, and obtained a government reply confirming that producer statements are not required for a building consent. Andy recognises the method immediately as structurally identical to a delay analysis.

Key Topics Discussed

  • The $5,000/m² root cause. "The root cause of the problem is the Building Act and the way it's administered." The RMA gets the reform energy, the Natural Environment Bill and Planning Bill under Bishop and Simon Court look genuinely better, but the Building Act has been "shadowed out badly."
  • Monopoly control over the supply of building consents. If Auckland Council refuses, there is no competing authority. "Monopoly control over the supply of anything, we have a Commerce Commission for a reason." Were councils businesses agreeing territorial carve-ups, the Commerce Commission would prosecute; instead Parliament passed a Building Act cutting directly against the Commerce Act. Crucially: "you don't blame the monopolist, you blame the entity that creates the legislation that gives rise to that effect."
  • Prescription versus performance. Acceptable solutions and verification methods, with standards below them, are not mandatory, but follow them and you are guaranteed a consent. An acceptable solution is "a prescriptive cookbook" issued under section 22.1, its contents set by the MBIE chief executive. The consequence: "you can never innovate via acceptable solution," and performance-based design does not flourish. Australia's private certifiers will at least take a performance-based design across the desk.
  • Section 392 and where liability actually sits. Councils carry no liability for anything complying with an acceptable solution or verification method, so rubber-stamping is rational and consent timing becomes something you can put on a Gantt chart. Andy: "I've made a living on doing that for the last few years." Christian: "I know, but it's not the way forward."
  • The leaky-building inheritance. The Building Act 2004 was "a bad outcome out of trying to fix an even worse outcome." Monopoly control over consent supply was never going to stop buildings leaking; the actual failure was that the acceptable solutions and standards contained errors, build to them exactly and the building still rotted from the inside out. He names it a classic moral hazard: the people who created the mistake did not pay the cost, and taxpayers did.
  • His one lever, worth at least 20%. Dismantle the consent-supply monopoly. The interim measure he proposed in his 2021 thesis is now starting to happen: let an applicant lodge with any council. Consent processing "is nothing more than an exercise in processing plans and specifications for compliance to New Zealand's laws, it's not a geographic-specific application of the law." Timaru District Council has begun, having realised the Act does not prohibit it. He is explicit that centralising councils would simply rebuild the monopoly: "let them fight for your business."
  • Why private BCAs have not filled the gap. They are permitted, but insurers walked out of the market under the 1991 Act when private certifiers carried leaky-building liability. New Zealand is a tiny market. Nobody has addressed the insurance angle in research or administration, a named gap.
  • Petition one, MBIE determinations. The Act contemplates ~60 working days; determinations were taking two years and some five or six, and the rulings were known inside Parliament to be poor. "It was a project killer." He petitioned to allow appeals to the District Court instead. Parliament declined the Act change but rebuilt the determination system: throughput and quality both up substantially. "I actually recommend it to people now."
  • Petition two, producer statements. A producer statement is "a promissory statement to say I promise this complies." The term lived in the 1991 Act; the 2004 Act repealed it, and producer statements are not in the Act, not statutory law. Councils cannot exceed the powers Parliament granted, and no enabling section supports a producer-statement policy. The government's reply to his petition, at paragraph 14, confirms they are not required as part of the building consent process. Refusing an applicant for being "not qualified to sign a producer statement" shuts out competition, when the Act restricts who may submit only for restricted building work and dams. On PS4 specifically: case law about two years ago made the signer strictly liable for deficiency, yet construction monitoring is the BCA's role under the Act and a BCA has no authority to compel a consultant to do it. He has seen people put the government reply in front of a BCA, decline the PS4, and still receive their CCC.
  • The playbook, step by step. Collect empirical market evidence of the effect (the Official Information Act is a tool); be dispassionate, bias reads as lobbying and gets torn apart; tie the effect to the specific section of the Act or the decisions that should be happening under it; write up what the law was meant to achieve against what is actually happening, with real legal reasoning. Then petition: any person may, with a local MP's support, 80 characters of title, 300 of description, 500 of further detail. He has used the petitions select committee three times and regulations review twice. Timeline about three to six months. The advantage is going straight to the legislature: "sometimes the government department is actually the issue."
  • How he found the pathway. Out of frustration. He could not publish a dissenting view in fire-engineering academia, so "I started using Parliament as my publication pathway… after that what I was doing couldn't be ignored."
  • Andy: this is a delay analysis. Andy maps the method onto his own work in real time, gather the evidence, build a timeline of events, take a programme, apply one of six prescribed methods, run a root-cause analysis of cause-and-effect or effect-and-cause, publish findings. He notes he sits on the construction dispute resolution board in New Zealand and is always the independent. He adopts "dispassionate" on air.
  • The Australian Building Codes Board. He is writing a reform paper for a public-policy think tank whose findings reach outlets such as the Australian Financial Review. The ABCB writes the National Construction Code, adopted through each state and territory building act because the federal government does not administer building law. The defect: the ABCB "are not governed by any primary federal statute as to what they can choose to put in the National Construction Code", regulation without an enabling statute. Tasmania has published a damning conclusion. On a $200bn-a-year market with 2m+ workers, he estimates approvals now take six to twelve months longer than five or six years ago, against Australia's worst-ever housing crisis.
  • Why construction does not do this. Other sectors do, Federated Farmers is very active legislatively. "In the construction industry it's just a void." His suggestion: developers should combine, in ways the Commerce Commission would welcome, to attack root causes. His templates are on the constitutional record and free to copy.

Notable Quotes

  • "The root cause of the problem is the Building Act and the way it's administered.", Christian van der Pump
  • "You can never innovate via acceptable solution.", Christian van der Pump
  • "It's not a geographic-specific application of the law.", on lodging a consent with any council
  • "Let them fight for your business.", Christian van der Pump
  • "I started using Parliament as my publication pathway.", Christian van der Pump
  • "You must be dispassionate about how you go about doing it.", Christian van der Pump
  • "In the construction industry it's just a void.", on the absence of legislative advocacy

Guest Background

Christian van der Pump began in chemistry and went far enough with it to start a PhD in atmospheric physics and chemistry looking at the role of carbon dioxide, abandoned, in his telling, because "I picked the wrong supervisor." He switched to a Masters in fire engineering and worked across the Middle East, Australia, New Zealand and the UK. Seeing the same inefficiencies recur in construction and nowhere else, he took a year out to complete a degree in microeconomics, looking for a universal way to solve them. Dealing with Christchurch earthquake claims and dissatisfied with the legal service he was getting, he dismissed his lawyers and taught himself law well enough to handle the insurers himself. He was a volunteer firefighter and emergency service responder. He finished his PhD about eighteen months before recording, deliberately "a functional PhD," research aimed at solving industry problems rather than at comfortable publication: "if it upset people, I didn't really care." He is a principal fire engineer at Kirk Roberts, and describes his current driver as regulatory reform.

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