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The nation’s peak construction industry body is demanding urgent action from the federal government as productivity plummets and the cost of building construction skyrockets.
Master Builders Australia is calling on the Albanese government to back key reforms amid declining productivity and dwindling housing supply, causing the cost of building a home to rise.
According to the peak body, productivity in the building and construction industry has fallen by a drastic 18 per cent over the past 10 years, while the cost of building a home has risen by more than 40 per cent.
The group has made a submission to the Productivity Commission’s productivity reform consultation, calling for six key recommendations to be implemented.
According to Master Builders, multiple “compounding pressures” are to blame for the crisis, including supply chain disruptions, high inflation, and workplace relations changes.
“Builders are grappling with ongoing supply chain disruptions, rising material costs, and fixed-price contracts that no longer reflect market realities,” Master Builders said.
“Profit margins have all but disappeared, labour shortages are delaying projects, and recent workplace relations changes are restricting flexibility on site.”
“High inflation, elevated interest rates, and growing layers of regulation, particularly burdensome for small businesses, are further stifling progress,” it said.
The peak body suggested the federal government’s attempt to pursue reform to boost productivity was only scratching the surface.
It said it would encourage the government to work closely with industry on significant reforms to deliver solutions.
Master Builders’ key recommendations include a full review of the National Construction Code, including better alignment and reduced dependence on performance solutions.
Additionally, the body is calling for free access to all regulated building standards, removing paywalls on legal obligations and supporting small businesses with compliance.
The association is also hoping for tax reform, including changes to company tax and review of land and construction taxes, and charges across state and federal jurisdictions.
Master Builders’ other recommendations include workplace relations reform via competition law, faster planning approvals, and build-ready land and stronger digital uptake support.
Master Builders Australia CEO, Denita Wawn, said the industry was dependent on the government for reform to solve the deepening crisis.
“Australia’s productivity challenge begins with the built environment and so does the solution,” she said.
“Our industry is under intense pressure, from broken planning systems to skills shortages, red tape, and regulatory creep.
“It’s not governments that build homes, it’s private businesses. What we need is for them to clear the path so we can get on with the job.”
Wawn added that increasing productivity was pivotal to enabling a “better, safer and fairer” building and construction industry.
“Productivity reform allows the industry to deliver quality outcomes more efficiently, reduce cost pressures, lift safety standards and ensure businesses of all sizes can thrive and compete on a level playing field,” she concluded.
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