Australia’s cladding crisis is growing and is leaving a number of building owners on the brink of financial collapse in its wake. Over 3,400 cases of non-compliant cladding have now been discovered in apartment buildings across the country, posing significant fire safety risks to every single one of those buildings. In Victoria specifically, nearly 400 buildings have been deemed ‘high risk’ and over 70 buildings have been classified as ‘extreme risk’. As of February this year, only 11 of these buildings had undertaken rectification works. So why hasn’t there been much progress – and where will it leave building owners and developers? Here’s what we know.

Why haven’t the cladding issues been rectified yet?

State governments have been allocated the task of rectifying below-standard cladding within their respective states. However, not only are these works extremely expensive, but they also require a high quantity of supplies. There is a shortage of many of these supplies due to the Covid-19 pandemic. This has significantly slowed down the rectification works across Australia. On top of this, standards, law and requirements surrounding cladding and compliance have been constantly evolving since the discovery of non-compliant cladding. Combined with the delays on works, these updates to policies and regulations mean that stakeholders involved in cladding replacement works are spending time having to keep up with the latest cladding-related developments.

Who has to pay for the cladding rectification?

This varies depending on the scope and urgency of the job. However, the costs have largely fallen to homeowners and owner’s corporations. Research has shown that cladding rectification works have been quoted between $30,000 and $12 million, depending on the scope of the job. This is because rectification is simply one cost associated with cladding works; other costs include increased levies and body corporation fees, insurance costs, council rates, legal fees and more. Insurance companies have started cracking down on the specifics of cladding jobs and materials in order to avoid bearing the brunt of the cost. Of course, this has put incredible financial stress on building and apartment owners.

So what’s the solution?

Regardless of the cost, cladding rectification is an essential repair that will improve the safety of thousands of buildings and their occupants. Experts in the industry are suggesting a shift from paper-based records over to a digital system to more easily keep track of past works as well as in-progress jobs. This could potentially save building owners on unnecessary or extravagant costs. There also remains hope that the increasing vaccination rates will mean the industry can find its feet sooner rather than later and materials supply will no longer be delayed.

Learn more about the cladding projects our team here at MAZ Group have undertaken and how we have helped businesses meet compliance requirements. Contact us today to find out how we can help your business.