Updates to Cladding laws in Victoria

Worldwide, the use of combustible cladding has resulted in several highly publicised building fires, most notably the Grenfell Tower in London which resulted in 71 fatalities. In addition to this, non-fatal incidents in both Melbourne and Dubai also gained much notoriety in the media.

After an Australian Federal Senate Inquiry and multiple investigations, we have reached a tipping point, and 2018 is finally seeing some action. Regulatory changes and laws drafted to either ban or control the use of various types of cladding will come into play, helping ensure the safety of countless buildings and their occupants.

What is aluminium cladding?

Typically known as Aluminium Composite Panels (ACPs), aluminium cladding is generally composed of two aluminium panels bonded to a core of either polyethylene or polyurethane. ACPs are used for thermal insulation and weather resistance, while also improving the external appearance of a building.

Dangers of aluminium cladding products

While some cores are constructed with a mixture of polyethylene (PE) and fire retardants, many use 100% PE – a highly combustible material. Should one of these panels ignite, a PE-fuelled fire can cause the bonded aluminium panels to melt, igniting adjoining panels in what can quickly become a devastating blaze that rapidly progresses over a building’s façade.

Why is this product in use?

Cladding Composition InfographicA mix of higher costs, and a significant decline in the production of Australian-made cladding has seen suppliers and builders import and use cheaper internationally-sourced cladding in construction. It is these materials, that haven’t undergone adequate fire testing in accordance with Australian standards, which have become a major issue.

It can be very difficult to discern whether cladding is fire rated with low combustibility, or filled with the problematic combustible PE core. Many imported products ‘claim’ to be constructed with non-combustible materials, or to have undergone and passed fire testing.

In a recent interim report to the Australian Parliament, multiple sources (including the Australian Institute of Architects, and the Australian Institute of Building Surveyors) stated that they had identified incorrect, fraudulent or inadequate documentation, and certificates of adequacy as potential reasons why non-compliant cladding has been installed on so many buildings. (i)

By continuing to substitute compliant cladding with low cost, non-compliant products, builders have engaged in a dangerous practice that has created an insurmountable risk to both domestic and commercial properties, as well as the lives of those who occupy them.

Changes in 2018…

1. A new formal protocol for the assessment of all aluminium cladding

The Insurance Council of Australia (ICA) and Australian insurers have now agreed upon a new protocol which will help to identify the risks presented by various types of ACPs.

The Residual Hazard Identification Protocol (RHIP) is designed to help identify whether a particular type of ACP should be used in construction, and also to provide a consistent risk assessment methodology for builders and underwriters where ACP materials are thought to be present.

If you are a building owner and are aware of ACPs present in the construction of your building, ensure your insurer and insurance broker have been notified so that the panels can be properly identified, the risk evaluated, and safety recommendations made accordingly.

For more information on the new protocols, read the ICA’s release by clicking here.

2. New Ministerial Guidelines to ban the use of non-compliant materials

On March 13, 2018, the Victorian Government released new Ministerial Guidelines concerning the use of ACPs for multi-storey buildings in Victoria.

The guidelines, aimed at municipal and private building surveyors, state that building surveyors should not be satisfied that any ACPs to be used as an external wall fitting will be automatically compliant with the Building Act and Regulations.

Compliance of the ACP product must be assessed and determined by the Building Appeals Board to ensure that it is in line with the Building Act and Regulations. These guidelines have been in effect as of 22nd March 2018. (ii)

It is expected that these guidelines, set by the Victorian Government, will soon be followed in other Australian states and territories.

3. Actions by the Victorian Building Authority

The Victorian Building Authority (VBA) has now issued product safety alerts to building practitioners regarding the use of ACPs, and the risk they present to life and property, with reference to the aforementioned Ministerial Guidelines. (iii)

The VBA is now working to ensure all practitioners have a greater understanding of the National Construction Codes (NCCs) and building legislation, so that compliance with new laws is taken seriously.

With a significant increase to their existing compliance and enforcement activities, the VBA will now be able to impose higher fines and penalties for breaches by practitioners who fail to adhere to the new regulations – up to $400,000 and in extreme cases, imprisonment. (iv)

4. The Victorian Cladding Taskforce Audit

Cladding Did You Know Infographic

On the 3rd of July, 2017, the Victorian Government established the Victorian Cladding Taskforce to investigate the extent of non-compliant external wall cladding on buildings in Victoria, and to make recommendations for improvements. This taskforce is comprised of multiple bodies, including:

  • the Department of Environment, Land Water and Planning (DELWP),
  • the Department of Health and Human Services (DHHS),
  • the Metropolitan Fire Brigade (MFB) and Country Fire Authority (CFA) and,
  • the Victorian Building Authority (VBA).

The findings indicated a variety of issues that needed addressing;

  • the supply and marketing of inappropriate materials,
  • a lack of compliance within the building industry, and
  • inadequacies in the current regulatory system which failed to deal with the issues presented by combustible cladding.

New measures are now in place to prevent the use of ACPs with a polyethylene core of more than 30%, and expanded polystyrene (EPS), for particular classes of residential and commercial construction. These new regulations will be in effect until new and improved testing systems and standards are in place.

As part of the long-term reform, DELWP are recommending that a statutory ‘duty of care’ be applied to building practitioners, to ensure they exercise ‘due responsibility’ to protect occupants in the residential and commercial strata sector.

For further information on the above, and to see the full list of recommendations, read the November 2017 interim report here.

Combustible Cladding & Strata Insurance

If you are a Strata Manager who is aware of potentially combustible cladding in strata properties within your portfolio, then you are no doubt concerned with rectifying the issue, and minimising the impact on the strata insurance.

Below we have outlined a simple 3-step process for Strata Managers to undertake in order to mitigate the potential hazards of combustible cladding on their strata properties:

  1. Identify buildings within your property portfolio that may have cladding issues, or that you know to have cladding present.

  2. Seek the services of a registered Fire Safety Engineer to:
    undertake a risk assessment, and identify the precise cladding materials in use,
    determine the extent of cladding used throughout the building.

  3. Take the Fire Safety Engineer’s recommendations into consideration and inform the OC Committee. This will ensure they can take the necessary steps to mitigate the cladding risk and bring the building back in line with the National Construction Code.

Insurers will look more favourably upon Owners Corporations who are proactive in rectifying issues such as the use of dangerous ACPs, especially when it comes to strata insurance renewal.

Ultimately, implementation of the regulatory actions – whether strict guidelines or a permanent ban on particular products – will go a long way to ensuring safer buildings for both residential and commercial use, helping prevent serious loss of life in the event of a building fire.

For more information on combustible cladding, or to obtain professional advice when it comes to insurance, contact Whitbread Insurance brokers:

P: 1300 424 627
E: info@whitbread.com.au



LinkedIn WIB narrow

i) Parliament of Australia | Senate Standing Committee on Economics: Non-conforming Cladding Interim Report
ii) Victoria Government Gazette No. S 110 Tuesday 13 March 2018 | Minister’s Guidelines under Section 188 of The Building Act 1993 (VIC)
iii) Victorian Building Authority | Building Product Safety Alert – ACP and EPS
iv) ABC News | Builders on Notice: Don’t use flammable cladding on Victorian high-rises

This article is not intended to be personal advice and you should not rely on it as a substitute for any form of personal advice. Please contact Whitbread Associates Pty Ltd ABN 69 005 490 228 Licence Number: 229092 trading as Whitbread Insurance Brokers for further information or refer to our website.

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