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Non-conforming products 'widespread' across construction sector

21 November, 2013

A new survey has revealed major product line discrepancies within building and construction companies.

"New Ai Group research out today reveals the widespread use of non-conforming products across the building and construction sector," Ai Group chief executive, Innes Willox said on Thursday (21 November).

"An extremely large proportion (92 per cent) of companies responding to our survey reported non-conforming products in their supply chains.

"This raises important questions about quality and safety and it poses serious commercial challenges for the businesses that do play by the rules."

"The report - The quest for a level playing field: The non-conforming building products dilemma – is based on a survey of more than 220 individuals and organisations across manufacturing, fabrication, supply and building industries and face to face meetings with over 240 industry participants.

"Almost half of businesses surveyed (45 per cent) reported lost revenue, reduced margins or lower employment numbers due to non-conforming products in the steel, electrical, glass and aluminium, and engineered wood sectors. The majority of the non-conforming products do not meet regulatory, Australian or industry standards. Others are not fit for their intended purpose, are not of acceptable quality, contain false or misleading claims or are counterfeit product.

"In addition to evidence of non-conforming products, the report also reveals significant confusion among companies about how to identify non-conforming products and who to report them to.

"Gaps and weaknesses in the building and construction conformance framework are also highlighted. Non-conforming products are allowed onto the market due to inadequate surveillance, audit checks, testing, verification and enforcement. The report suggests that building certifiers bear a disproportionate share of the burden for product conformance and raises the question of whether more responsibility should be taken by product suppliers and builders.

"The impact of non-conforming products is a major concern for industry and this report clearly suggests the need to reform the current system to ensure quality and safety and to ensure Australian importers, manufacturers and fabricators have a level playing field. 

"Ai Group's proposals to address these issues are for:

  • Industry, in consultation with all tiers of government, to promote awareness of the role of regulatory bodies in the building and construction sector and in particular awareness of how non-conforming product can be reported;
  • State and territory governments to review their building certification arrangements with a specific focus on clarifying the role of building certifiers and assessing the adequacy of existing arrangements in preventing the installation of non-conforming product; and
  • Stakeholders, in consultation with all tiers of government, examine how to best address the gaps and weaknesses in the building and construction sector conformance framework."

"We also recommend that further research be undertaken on the extent of non-conforming product in other sectors and how the problems presented by non-conforming product can best be addressed while keeping compliance and administrative costs to a minimum," Willox said.

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Michael Cumner | Friday, November 22, 2013, 10:48 AM
most of the non conforming / poor quality materials are imported from China & India. if companies started to take a NO CHINESE / INDIAN MANUFACURED goods policy; you would weed nearly of it out. this cheap rubbish is also why our manufacturing industry is disappearing at an alarming rate. the big construction / engineering companies only seem to worry about price and as such quality suffers. the old adage - you get what you pay for is so true !
jonno | Friday, November 22, 2013, 1:14 PM
Local manufacturers are obviously required to meet local standards, and for imported product it should be the responsibility of the importer to ensure the products meet Australian standards. When a local manufacturer or an importer fails to meet required standards there should be a significant penalty, proportional to head office income (global head office if it is a multinational, because the buck stops at the top!). We know that in many cases self-regulation does not work very well, otherwise this would not be an issue right now. So who should do the regulating, and who should do the specification testing?
Jay | Saturday, November 23, 2013, 2:30 PM
Hey Michael, you will not get rid of nonconforming products because these industries are dominated by Asian building and construction firms, many based in Asia. They are going to cut costs at all corners and its the subcontractors who are not Asian (a minority who end up bearing the brunt of additional costs. We can thank Kevin Rudd for allowing foreign buyers of crap apartment blocks across Australia made by Asian companies in direct violation of councils regulations and height limits. This means more and more locals cannot afford to buy a property anymore. Rudds desire to look like we avoided the property crash of the US by having foreign buyers come in means we don;t have a country of any substance any more and our people are going to be the the new third world.
glen scott | Monday, November 25, 2013, 11:49 AM
The resposabilit is with the importer,Making individuals resposibile by way of fines or jail will make the buyers think twice before recommending to managment to import the item ,too often i have heard the Australian standard doesn't apply to Chinese product,or its not my problem its QC job to check,QC say its buyers. Management think its passed all the internal checks when it hasn't. Its the company that gets the fine. Its interesting to know that if you purchased the same quality same qty and paid the same way and took into account the import cost, QC cost and buyer expences and fault rate there is less the 8% differance in many cases. You pay for what you get and labour is in many case's a very small part of the costs.
Trev | Monday, November 25, 2013, 12:50 PM
One difficulty is that Australian manufacturers have to produce against Australian Standards, where imported products can be produced to the "corresponding" International Standard. Many International Standards are far below the requirements of AS due to Australia's climate, UV needs, etc. The cost saving to the importing manufacturer is very low just on material costs compared with what must be used here. Product sold into the Australian market should pass Australian standards for starters to begin to have a level playing field. International Standards should only be recognised when they are equivalent or superior to Australian Standards.