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Genuine independent contracting and small business are the foundation of the residential building industry.
Over 55 per cent of residential builders and trade contractors have no employees, with a further 40 per cent having between 1 and 19 employees. More than 90 per cent of residential builders and trade contractors are small businesses with a turnover less than $2 million.
Of the more than $65 billion in new housing starts nationally each year, on average the HIA Housing 100 companies only build around 35 per cent, meaning the bulk of new homes are delivered by small businesses. Home renovation work is delivered by a separate cohort of the industry, generating around $36 billion in activity each year, with the majority of these being small businesses.
While the focus is often on the ‘laws’ that create red tape and complexity, the reality is that red tape lives in the business processes and administration requirements across multiple government departments and agencies at the national, state and local level. Improvements that can allow small businesses to flourish need to come from changes in ‘the way we’ve always done it’ rather than changes from parliaments. Time adds cost – every day that can be saved helps someone move into a new home sooner.
The role of regulation, and hence parliaments, is changing as community expectation shifts in relation to the outcomes they want from residential buildings. Managing this shift now is critical. The regulatory processes need to remain fit for purpose. They need to appropriately manage the competing social and economic interests they are being asked to juggle. If this is not possible, then now is the time for change.
HIA will work to achieve regulatory and administrative arrangements that create a clear pathway to let businesses do business and deliver the homes and renovations Australians demand.