Regulation of Providers of Building Works Bill reaches Committee Stage

Key Points

The Regulation of Providers of Building Works Bill (the Bill) continues its progress through the Irish legislature and has now reached the Committee stage (the third stage, before the Dáil). This third stage will see the Bill debated before the Select Committee on Housing, Local Government and Heritage for Committee State, at a date to be confirmed.

The purpose of the Bill is to raise standards in construction through the establishment of a register to be known as the Construction Industry Register Ireland (CIRI). The aim of the CIRI is to regulate providers of building works by requiring all entities who provide building services to register with CIRI. This registration body will determine the standards and competence required from providers of building works. It will also investigate and adjudicate complaints against them. 

CIRI's main function will be to assess the competence and eligibility of any entity or person who requires registration, using criteria laid out in the draft legislation. These criteria will consider relevant experience or qualifications in the construction industry or a combination of both.

CIRI will establish an Admissions and Registration Board which in turn will establish committees to assist and advise it in relation to its functions. The members of the Admissions and Registration Board will be appointed by the Minister for Housing, Local Government and Heritage, Mr Darragh O'Brien TD (the Minister).

Registrants will be required to have public liability insurance and employers’ liability insurance if it applies. There will be a statutory Admissions and Registration Board and Appeals Board.

The Bill also allows for complaints against registered builders to be made on a number of grounds, in particular for providing building services in a category in which a provider is not registered. It also provides for a range of proportionate sanctions to be imposed after investigation.

Entry onto CIRI will be open to all builders, whether sole traders, partnerships or registered companies, who can demonstrate that they are competent to carry out works in the category for which they are seeking to register. Companies will be able to register by contacting the CIRI office or visiting its website and completing the online application form.  

Background

Previously known as the Building Control (Construction Industry Register Ireland) (CIRI) Bill 2017, the General Scheme was first published and underwent pre-legislative scrutiny in 2017. This legislation has been long since supported within the construction industry. 

The Construction Industry Federation (CIF) established a voluntary register in 2014 and CIRI will continue to be operated by the CIF, following the enactment of the legislation. Approximately 800 entities are currently registered on a voluntary basis.

The Bill is largely motivated by the Government's wish to avoid the reoccurrence of housing defects that were the legacies of poor construction design, workmanship and materials. Something which has, to quote the Minister, 

"impacted so significantly on the lives of so many of our people. By driving regulation in the construction sector, the State will ensure the mistakes of the past are not repeated and we have a more sustainable housing system and construction sector in the future."

The Bill forms part of the Government's national plan for housing, 'Housing for All', which sets out an ambitious target of delivering 300,000 new homes by the end of the decade to address our national housing crisis. As part of that plan, addressing the legacy of poor workmanship and regulatory failure while preventing repeated mistakes in the future, has been a priority for the Government. 

Provided the Bill is passed, it is envisaged that the register will be set up over the next two years, with registration being mandatory from 2024.

Purpose of the Bill

The main objective of the Bill is to develop and promote a culture of competence, good practice and compliance with the building regulations in the construction sector.

The Bill provides for a mandatory register of builders, contractors and specialist sub-contractors, subject to a limited number of exceptions. Builders will only be permitted to carry out building works for which they are registered to provide. 

The Bill aims to expose the 'black market' economic activity taking place in the construction sector and ensure fairer competition for compliant building operators.  

Given the urgent need for housing in Ireland, the Bill aims to provide confidence that homes are built to the highest standards and that any professional services used are also of a high standard. 

The Bill will also complement a number of key measures the Government has in place to strengthen the arrangements for the control of building activity following the building failures that have emerged in recent years. These measures include the revised Building Control (Amendment) Regulations 2014, the activation of registration arrangements for construction professionals provided for in the Building Control Act 2007, the development of the nationwide online building control management system and the move to risk-based, standardised inspections by local building control authorities.

Key Provisions

  • Part 3 provides for the establishment of the Admissions and Registration Board, Committees of the Board and the Appeals Committee. It provides that all members of the Admissions and Registration Board and the Appeals Committee shall be appointed by the Minister and that the Minister shall have a majority of nominees on these. It also contains appropriate safeguards to ensure the independence and objectivity of the registration board and the appeals committee;
     
  • Part 4 provides for the establishment of CIRI and the competence criteria required to be eligible for registration; 
     
  • Part 5 provides for the operation of CIRI, and outlines prohibitions against operating as a provider of building services while unregistered. It also outlines the application process and the requirements for registration as well as renewal of registration;
     
  • Part 6 provides for the handling of complaints and appeals from applicants regarding registration decisions and from complainants in respect of the activities or conduct of registered members. It outlines the role and powers of the inspector who may investigate the complaint as well as the roles of the Board, the Appeals Committee and the High Court in the imposition of sanctions; and 
     
  • Part 7 contains some miscellaneous provisions including provisions for offences and penalties. It provides for the publication of sanctions and convictions, arrangements for restoration to CIRI and transitional arrangements in the event of a change in the appointment of the registration body.

Concerns and possible Pitfalls

Protectionism 

There are concerns that the Bill may limit who can participate in the market and also how the criteria for registration will be applied. It will be important that CIRI does not discriminate against builders established in other jurisdictions, and it is hoped that online registration will alleviate this concern somewhat. 

Independence and objectivity of Registration Board and Appeals Committee 

  • Given the broad range of academic qualifications and practical experience within the construction industry, it is crucial that applicants' adherence to the competence and experience criteria (as set out in the Bill) is assessed as objectively and independently as possible. This will be critical to the acceptance and success of CIRI. 

Cost

The administrative and cost burden of CIRI must be mitigated, particularly for small builders;  

  • Requirement for CPD must also be proportionate to the complexity of the work being carried out;
  • Once the Bill is enacted and the registration body is nominated, CIRI is likely to incur a substantial pre-commencement establishment cost; and
  • To establish the register and enable a smooth operational transition, the CIRI will need sufficient funding to establish the statutory regime.

For further information in relation to this topic please contact Conor Owens, partner, Tom Sexton, solicitor, or any member of ALG's Construction & Engineering team.

Date published: 3 February 2022