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29 May 2023

Government Releases Response to Residential Building Supply Study

On 17 May 2023, the NZ government released its response to the Commerce Commission's market study into residential building supplies. This includes key actions aiming to improve competition and transparency around building materials.

The Government has agreed in principle to eight of the nine recommendations made by the Commission to improve the sector for businesses and consumers.

Key actions will include:

  • Monitoring and publishing prices of key building supplies
  • Working towards offering more guidance to support builders and councils to make good decisions on alternative equivalent products
  • Driving the uptake of offsite manufacturing by Government agencies by a minimum of 10% year on year, to improve productivity and competition.

The Government says it will go further than some of the Commission’s recommendations and expand on its existing review of the building consent system. It will also widen its work to ensure alternative building products are more easily used, following last year’s plasterboard shortage.

The Government has also highlighted steps that have already been taken to address issues identified in the report, including:

  • Reviewing the Building Consent system to address issues identified by the Commerce Commission.
  • Establishing a Critical Materials Taskforce to proactively explore supply-constrained building materials, as well as market imbalances.
  • Implementing a Construction Sector Accord Plan to tackle the sector’s challenges with a greater focus on growing innovation, resilience, the Māori construction economy and sustainability.

And, broader to building supplies, the Government will soon consult on an economy-wide review into the use of land covenants.

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