The cost of safety

The NZ Initiative has released a useful report:

As the lack of affordable housing hits crisis levels in Auckland and Christchurch, increased workplace safety compliance is costing Kiwi homeowners more than $100 million a year, according to a new report released today from research institute The New Zealand Initiative.

A Matter of Balance: Regulating Safety reveals that a “falls from height” workplace safety campaign from WorkSafe New Zealand (part of the Ministry of Business, Innovation & Employment (MBIE)) is adding thousands of dollars to the cost of building new homes and routine maintenance of existing homes, without proper justification.

“Workplace safety is a hugely important issue however further increasing the cost of undertaking routine maintenance and building new homes – which are already out of reach for many New Zealanders – through unnecessary regulation is a major public policy concern and should not continue,” says Dr Oliver Hartwich, Executive Director, The New Zealand Initiative.

The campaign particularly targets workplace falls of less than three metres – which potentially affects all single storey homes. Critically, no official cost-benefit analysis was carried out before the campaign was rolled out.

The new regulations also dramatically increase the cost of necessary home maintenance.

“A small-scale builder reported that the cost of complying with the WorkSafe New Zealand campaign turns a small $4,000 roof job into a $6,000 job,” says Hartwich.

“If half of New Zealand’s 1.8 million single storey dwellings need a new roof every 12 years at an additional cost of $2,000, the illustrative annual additional cost burden on householders of roofing alone is $150 million.”

These additional compliance costs may in fact induce some homeowners to further defer necessary maintenance work and take greater ‘do-it-yourself’ safety risks.

“While improving safety is an admirable goal for all of New Zealand, we need to ensure the right balance between improved safety and additional cost is maintained. The current regime is failing to ensure this. More lives could be saved elsewhere with the sums involved and the cost excesses are simply exacerbating affordability problems for new and existing homeowners,” says Hartwich.

Safety is an important goal, but if you believe in safety at all costs, then you’d advocate for a maximum speed limit of 30 kms/hr on all roads. It is about getting the balance right.