Property developers in the ACT will be required to hold a licence for the first time and will be required to pay up for repairs if there are issues with their buildings, under long-awaited laws proposed by the territory government.
The scheme would also establish a public register of licensed developers, while also giving the government greater power to issue rectification orders and disqualify rule breakers.
Sustainable Building and Construction Minister Rebecca Vassarotti will introduce the bill to establish the licensing scheme to the Legislative Assembly on Thursday.
The licensing scheme will mean builders and property developers are considered liable for building defects for the first two years after a building is occupied unless they can prove otherwise.
The scheme would establish a property developer licensing registrar, who would be responsible for maintaining the scheme and taking action against developers who break the rules.
The laws would define a property developer broadly, and include a person who either contracts or arranges building work to be completed, the owner of the land on which the building work takes place or a builder.
Ms Vassarotti said the government was dedicated to making all elements of the building supply chain accountable.
"The ACT government takes accountability within the development industry seriously, and these decisive steps to enhance the regulation and monitoring of the industry will help to make sure that it operates as its best and upholds the highest standards," Ms Vassarotti said.
Ms Vassarotti said the scheme represented an Australian-first move that would give Canberrans greater confidence their homes would be completed to the highest possible standards.
"Over recent years, high profile cases of poor development have undermined the trust of Canberrans in the home building industry," she said.
"Dodgy development choices by big businesses are estimated to have cost Canberrans more than $50 million each year. This law change will add property developers to the chain of accountability for building quality and safety."
Ms Vassarotti thanked the Construction, Forestry, Mining and Energy Union and the Canberra community for advocating for a developer licensing scheme.
"I would also extend my appreciation to building and construction industry organisations, as well as representatives from owners' corporations and strata managers, for their collaborative and constructive engagement over the past 12 months in the development of this scheme," she said.
The ACT government first committed in 2019 to introduce a scheme that would require property developers to hold a licence to build projects in the territory.
Ms Vassarotti in 2021 said the government was aiming to introduce the new licensing laws in the second half of 2022.
Labor backbencher Michael Pettersson in November 2022 threatened to introduce his own private member's bill to establish property developer licensing if Ms Vassarotti did not "get their act together".
The CFMEU renewed its calls for the licensing scheme after a local property development company director, Paul Kenneth Nimal Hamilton, was disqualified by the corporate regular from managing corporations until October 2025.
Zach Smith, ACT secretary of the Construction, Forestry, Maritime, Mining and Energy Union, said earlier this month the Canberra community was exposed to the unethical conduct of some developers.
"It's a good thing that ASIC has taken this action, but it should never have taken this long to protect Canberrans from people with track records as bad as this," he said.
Mr Smith called on the ACT government to expedite its "long-mooted" property developer licensing scheme in light of Mr Hamilton's disqualification.
The bill, to be introduced on Thursday, will likely be debated in the first half of 2024, with a transition period before licences are required.
"The ACT government will continue to engage with the local industry and other stakeholders to progress this reform, as part of a broader package of reforms for the building and construction industry," the government said.
The Property Council's ACT executive director, Shane Martin, had described the ACT's developer licensing scheme as a "policy missile being used to crack open a nut" that would increase the cost of new homes in the territory.
"Unamended, the government's developer licensing regime goes far beyond the issue it is trying to address. Instead, it will directly dent investment in new stock, increase the cost of new homes and increase our rents in Canberra," Mr Martin wrote in an opinion piece for The Canberra Times.
"If applied, the regime will mean a company director could be issued a personal rectification order for a future defect that their development company did not cause."
