The VBA’s New Powers: A Risk to Fair Dispute Resolution for Builders
The Victorian Building Authority’s (VBA) powers will change, and many in the industry are concerned about what this means for builders’ rights and fair process.
The reforms consolidate substantial authority within the VBA and pose significant challenges for builders facing legitimate disputes with homeowners. They come as a short-sighted, knee-jerk reaction to a highly critical report on the VBA’s handling of consumer complaints, which found serious failures in the authority’s management, culture, and processes.
Here’s why we should all be paying attention to these changes—and the potential consequences.
The New Model
In October 2024, Minister for Planning Sonya Kilkenny announced the formation of the Building & Plumbing Commission. This single entity will replace and combine the Victorian Building Authority (VBA), Domestic Building Disputes Resolution Victoria (DBDRV), and the Domestic Building Insurance (DBI) functions.
Their aim? To simplify processes for homeowners and professionals. According to the VBA:
“The new regulator will bring together key functions related to the building industry together under one roof, streamlining the process for consumers and industry and enabling the regulator to have oversight of all complaints so they can be handled more effectively.”
Changes are expected to come into effect during the first half of 2025.
The intention might sound promising, but the implementation raises questions about whether the new authority will repeat or even exacerbate the issues found in the report.
Judge, Jury, and Executioner?
Under the new model, the VBA’s power will be increased. They will be positioned to act as the judge, jury, and executioner in building disputes.
“For those building, renovating or buying a home, the new Regulator will mean peace of mind,” said Sonya Kilkenny. “For those found doing the wrong thing, it’ll mean consequences.”
Of course, regulatory oversight is essential. However, this consolidation of authority leaves builders vulnerable to decisions that may not account for the complexities, nuances, or legitimacy of individual disputes. It’s also particularly concerning given the systemic shortcomings in the authority’s previous approach to consumer complaints. The report concluded that closed cases took priority over fair outcomes.
For example, if there’s a dispute between a builder and homeowner, the builder may be pressured to meet the demands of the regulator rather than relying on a fair, unbiased legal process.
The Pressure to Settle
For builders, the new model signifies more than a shift in who makes the calls. It’s a new pressure, one that will compromise their ability to defend themselves—even in cases where they have followed industry standards and contractual agreements.
Without a balanced hearing, builders may be forced to accept unfavourable resolutions just to avoid the risk of non-compliance penalties or reputation damage imposed by the VBA. This could lead to higher financial burdens for builders, something that will disproportionally affect small businesses that operate on tight margins.
A Call for Fair Process
To protect the interests of all parties—builders, homeowners, and the industry at large—it’s essential that we fight for a system that upholds fairness and transparency. Builders must have a pathway to challenge regulatory decisions without fear of disproportionate consequences.
As the industry adapts to this new framework in 2025 and beyond, it’s vital for regulators, builders, and industry bodies to work together to ensure a balanced approach to dispute resolution remains a priority.
The Path Forward
Builders and industry professionals need to stay informed about these changes and consider the potential impact on business practices and client relationships. Open dialogue with the VBA and industry stakeholders can also prevent regulatory power from overshadowing the right to fair, unbiased dispute resolution.
At BEA Insurance Brokers, we’ve spent two decades supporting builders, and we know what the challenges of this new framework mean. We encourage you to reach out for a conversation about how these changes might affect your business.
You could also reach out to your local Member of Parliament and advocate for a more balanced, unbiased regulatory framework.
This is not a time to be complacent. If we can rally together to uphold checks and balances, we can better protect the interests of our industry and ensure a fair environment for all parties involved.
