21 October 2014 Cuts to red tape to save DHA approximately $15 million

Defence Housing Australia (DHA) has welcomed key changes to the Australian Government Building and Construction OHS Accreditation Scheme, which will allow the award-winning developer to save approximately $15 million across a 12-month period and open its construction tenders to multitude of small businesses across the country.

Under the Scheme, subject to certain financial thresholds, only builders who are accredited could enter into contracts for building work that is funded directly or indirectly by the Australian Government. The changes announced today include the lifting of the requirement for accreditation for single-dwelling projects and raising of the threshold for multi-unit projects from $3 million to $4 million.

‘This policy change will directly, and significantly, increase the number of builders able to respond to DHA’s construction tenders,’ DHA Managing Director Peter Howman said. ‘The requirement to engage an Federal Safety Commission (FSC) accredited contractor has restricted DHA’s business by reducing the size of the eligible tender market and lowering the likelihood that we will get the best value product at the best price.’

Based on estimates from residential developments undertaken by DHA, the additional cost to each dwelling, as a result of complying with FSC requirements, is $15,000 per dwelling.

‘In 2014/15, non-FSC accredited builders were excluded from tendering for more than 500 houses around Australia. Removal of this limitation would be expected to have saved us more than $9 million. Similar savings should be expected for future years.’

It’s also expected the changes would bring cost reduction across civil works, providing savings of more than $6 million over a financial year.

‘It will bring greater competition, reduce costs to DHA and make work available to more builders across the country,’ Mr Howman said. ‘We look forward to working with more builders, many of them small businesses, who up until now had been unable to partner with us.’

ENDS

 

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