What really caused the cladding crisis in Australia? How we can prevent similar problems in the future?

Charles Nelson, LFRAIA, AIA, AECPM, PMI

In this paper, I won’t reiterate the newspaper coverage of the Cladding Crisis, in Australia and elsewhere. Every architect, engineer and building surveyor, as well as thousands of homeowners living in affected buildings, have read about the problem.

Instead, I want to provide a historical look at how we got into such a situation in the first place, and then advance a suggestion as to how to avoid something like this happening again.

Sometimes, the best of intentions produce outcomes nobody anticipated. This is one of those situations. I do not expect that all readers will agree with my conclusions; that’s fine. Read the argument, and decide for yourself.

The cladding crisis is a very unfortunate problem; a financial disaster for thousands of homeowners and for building surveyors caught in the backlash. It all began, innocently enough, with the Australian publication of the ISO 9000 series of quality standards in 1987. Of course, the publication of these standards was intended exactly to prevent the occurrence of problems like the cladding crisis! What went wrong? How could it go so wrong?

To find out, we need to consider the mindset of significant sections of the Australian governments at the time (and probably still true):

  • In some circles, a widely held view that government had a responsibility to set rules for building safety, but that enforcement should be a matter for industry policing rather than government policing;
  • A natural desire to distance government officials from responsibility for breaches of industry policing; and
  • A desire to save public money: Government policing of standards costs a lot of money.

The new Quality Standards provided an opportunity for government, at all levels, to act on these motivations. If the rules provided that industry had an obligation to comply with quality standards, they would become self-policing.


Role of the NCA

The first Australian government agency to make that fundamental switch was the NCA: The National Capital Authority – which was responsible for all federal government projects in Canberra – which replaced the former National Capital Development Commission in 1989. In 1991 the NCA advised all architects and engineers working on its projects that they would have to become certified to ISO 9001 in order to continue to work on government projects. Contractors were similarly advised.

The 23 architectural firms with Canberra offices first went to the Royal Australian Institute of Architects (RAIA) for guidance in complying with this ruling, but were told the RAIA couldn’t help them. They then formed a new company to help them create a system that would meet these requirements.

I can speak with knowledge here, because in 1992 I won the contract to create that prototype Quality System for this group, which we called “ABC Architects Quality System”. This system went on to become widely used as the de facto template for architects’ quality programs throughout Australia.


Self-policing of quality

So, what happened next? What happened, now that all these architects and engineers had “self-policing” quality systems in place, and so, presumably, did the contractors, the NCA no longer needed all these quality inspectors. They were retired, and encouraged to set up their own commercial inspection services, which most of them did.

Contractors were required to appoint, and purchase the services of, these quality inspectors, called “Building Surveyors”. Right there is precisely one of the two factors that led to the Cladding Crisis. There is an inherent and unavoidable conflict of interest in having contractors pay for quality policing of construction.

I am not implying that there was any endemic “buying” of approvals favorable to contractors. On the contrary; all the evidence supports the argument that most building surveyors acted ethically and carefully, in the best interests of public safety. That does not, however, remove the inherent conflict of interest of their position.

The example set by the NCA fairly rapidly spread around the country, with state and many local governments divesting themselves of the cost and responsibility for quality policing. Governments saved millions of dollars, which helped them balance budgets.


Alucobond and copycat products

The second factor that created the Cladding Crisis lies in the Alucobond story. Alucobond is a product that has been around, and used in Australian building facades, for at least four decades. Alucobond is a composite facade panel with two thin aluminium skins and a non-flammable foam core. Aluminium will melt at high temperatures, so the product cannot be considered to be “fireproof”; only “fire retardant”.

Note: Aluminium-faced panels are the principal materials in question, but there are other cladding products that have similar problems.

Alucobond was invented and first marketed in 1969, and patented in 1971. The patent expired in 1991, opening the door for rival manufacturers. These rival manufacturers, naturally, looked for ways to lower the cost of production and become more competitive. The result? The amount of fire retardant materials in the core was reduced, so that “comparable” products were no longer fire retardant. It has been reported that some manufacturers either used inadequate fire testing methods, or stamped these “copycat” composites “fire retardant” without testing them.

We may never know which products were used on which buildings. What we do know is that many of them are clad in unsafe materials, and that the approvals process was nowhere near rigorous enough to ensure that materials used were permitted only after testing in approved Australian test facilities.

There is a lot more relevant detail than the little bit presented above, having to do with recommended installation techniques, and other factors. This “Read More” paper is getting long. I will move to my recommendation to try to prevent similar disasters in the future.


The need for independence of Building Surveyors

We need to end the ability, realised or not, for contractors to influence Building Surveyors in decisions that could save money in construction. The way to do that is for governments, federal and state, to create a “pool” of qualified building surveyors. Contractors (or Owners) would be required to pay a building certification fee sufficient to employ a Building Surveyor for the full services required, into a fund for these services.

An independent body, representing the Building Surveyors, would assign a Surveyor to the project, who would be paid from this fund. Thus, the cost of the Building Surveyor’s services would be approximately the same as under the old system, but the Surveyors would be completely independent of the entity paying for their services.

This solution still preserves the government’s desire to stay out of the policing business, protects the Building Surveyors from accusations of conflict of interest, and would go a long way toward improving the safety of the end result.



If you agree or disagree with these ideas, please let me know. You can contact me on cnelson@psmj.com.

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