Part 2: Processing and reporting
2.1
In this Part, we describe Auckland Council's building consent work and how Auckland Council reports on it. We discuss:
- what happens when Auckland Council receives building consent applications;
- how consent applications are processed;
- building inspections;
- the process of issuing code compliance certificates; and
- management reporting on Building Control's performance.
Receiving building consent applications
Receiving applications
2.2
Building consent applications are primarily lodged in hard copy, with a small number received electronically for the Takapuna area and Special Housing Areas.2 About 70% of applications are received by post. Auckland Council has "lodgement officers" who check applications to ensure that they contain all the required information. This check is not a quality check. An application can be rejected if it lacks required information. All accepted applications must be entered into the Pathway system within 24 hours (or, if this task is transferred from another Auckland Council office, 48 hours) of being received. When the application is accepted , the "statutory clock" for processing applications within 20 working days starts.
2.3
After lodgement, the application is scanned electronically in the central and Takapuna offices. The application documents can be extensive. On a typical day, staff at the central office scan 12,000 pages (including resource consent applications and building consent applications).
Number of building consent applications received
2.4
In the year to June 2013, Auckland Council received about 18,000 building consent applications. In the year to June 2014, Auckland Council received about 19,000 building consent applications. Of these, 89% were residential building consent applications and 11% were commercial building consent applications. The flow of applications tends to be relatively consistent from July to November, falling noticeably during the summer holiday period before recovering.
2.5
In the 12 months to March 2014, the number of consent applications lodged increased by 5.4% (the number of residential applications increased by 7.5% but the number of commercial applications decreased by 3.6%).
Quality assurance audits of applications
2.6
Quality assurance audits of consent applications are carried out each month. Seventy-eight audits of applications were carried out between February and April 2014. Analysis shows that, for the 24 potential specific audit tests for each application, results fell below 90% compliance for three audit tests. The main reasons that lodged applications failed to comply with regulations were:
- not all checkboxes were ticked;
- some plans had no stamp; and
- no engineer had signed the supplied plans or drawings.
Our observations about lodgement of applications
2.7
Auckland Council receives many applications by post. In May 2014, the Ministry of Business, Innovation and Employment (MBIE) published a survey of 48 building consent authorities that showed that, nationally, 68% of applications were lodged in person, 23% by post, and 7% online.3 The MBIE survey also noted that one-third of authorities electronically scan the application documents before making technical assessments, and that the average scanning time for an application is 19 minutes. If we apply this average to Auckland Council, scanning takes more than 6000 hours a year.
2.8
Auckland Council receives many applications at the various receiving offices – about 1600 a month. Two copies of each application are required. This means extensive physical handling – Auckland Council's central office resembles a postal sorting centre.
2.9
We spoke to four architectural firms about the requirement for hard copies. Although staff at one firm were comfortable with the existing arrangements, staff at the other firms were keen for Auckland Council to move to an online application system. Staff at one firm estimated that they used two kilometres of A1-size paper a month, much of it for building consent applications.
2.10
The architectural firms told us that, on a few occasions, applications were not entered into Auckland Council's Pathway system until after the 24/48-hour time deadline. However, Auckland Council's internal audits and the IANZ reports found no recurring problem. Auckland Council is finalising a new checklist and process to help reduce the average time it takes to assess applications.
| Recommendation 1 |
|---|
| We recommend that Auckland Council bring forward the introduction of an electronic lodgement system for building consent applications. |
Processing building consent applications
Processing workflow
2.11
After an application is lodged, a team leader allocates the building consent application to a processing officer based on:
- the assessed risk and complexity of the consent; and
- the workload of each processing officer.
2.12
Auckland Council requires that the relevant fees and charges be paid before the application is accepted, unless the customer is an account customer. Account customers are those who have met credit and transaction level eligibility requirements.
2.13
As Figure 1 shows, building consent applications are grouped into six categories, based on how much risk they pose. Less experienced processing officers are allocated more Residential 1 category applications and experienced officers are allocated Residential 3 category and commercial building consent applications.
Figure 1
Auckland Council's risk categories for building consent applications
| Category | |
|---|---|
| Greatest complexity or risk | Commercial 3 |
| Commercial 2 | |
| Commercial 1 | |
| Residential 3 | |
| Residential 2 | |
| Least complexity or risk | Residential 1 |
2.14
The processing officer becomes the contact person during the consent process.
2.15
The consent application might be passed to specialist staff (such as drainage engineers) for technical advice. Because two hard copies of the application are received, some processing work can be carried out in parallel.
2.16
About 70% of consent applications need further information before they can be fully processed. This is because of problems with the quality of information lodged. This is known as a Request for Further Information (RFI). RFIs are sent either by post, by email, or by a telephone conversation, and are followed up periodically. The statutory clock is stopped until the information is supplied (see Figure 2).
Figure 2
The statutory clock and how the Request for Further Information process works
| The Building Act 2004 says that local authorities must process applications for building consents within 20 working days. If there is a Request for Further Information during consent processing, the statutory clock is stopped. It is not restarted until all the requested information has been received and checked. RFIs must clearly outline the problems and, where possible, refer the matters to the relevant section of the Building Code. Auckland Council does not accept information that is provided piecemeal. Applicants have 20 working days to respond to a Request for Further Information. Auckland Council's internal policy is to give two reminders during a three-month period, with a telephone call preceding the second reminder. If the information is not provided within 60 working days, the application is refused. |
2.17
Some customers can check the status of their consent application on Auckland Council's website.4
Number of consents issued and in progress
2.18
In 2013/14, Auckland Council issued 17,300 consents, up from 16,700 in 2012/13.
2.19
As Figure 3 shows, building alterations and renovations make up 73% of consents granted, new residences 25%, and new commercial buildings 2%.
Figure 3
Type of building consents issued by Auckland Council, 2013/14
2.20
Auckland Council describes consent applications being processed and those "on hold" as being "work in progress". At any time, many lodged consent applications are work in progress. At the end of June 2014, 2200 consent applications were work in progress, of which 1500 were on hold. Earlier in 2014, the number of applications that were work in progress reached nearly 3000. The equivalent figure in late 2012/early 2013 was nearer 3500.
Timeliness
2.21
Under section 48 of the Act, a building consent authority must, within the time limit, either grant or reject the consent application. The time limit is 20 working days after receipt of the application (10 working days where there has been a national multiple use approval).5
2.22
During 2013/14, Auckland Council processed 98.5% of consent applications within the statutory time limit, slightly better than in 2012/13. Auckland Council's "target line" is 95%. The average processing time was 9-10 working days.
2.23
We compared how well Auckland Council and some other urban local authorities met the statutory time limit (see Figure 4).
Figure 4
Percentage of building consent applications processed by selected local authorities within the time required by statute, 2012/13 and 2013/14
Source: The councils' annual reports.
2.24
Auckland Council uses a more compelling measure internally – consents granted within 40 working days of lodgement. This measures the total elapsed time, including the time to receive further information – that is, the true time elapsed. Using this measure, about 80% of consents are issued within 40 working days.
Consent processing productivity
2.25
At the time of our audit, Building Control had 84 building consent processing officers and a further 13 vacancies. Processing officers process an average of 0.85 building consent applications (of all types) a day.
2.26
Auckland Council monitors the productivity of each receiving office and each staff member.
Quality assurance audits
2.27
Every month, quality assurance audits are carried out in each office. The results of the audits are analysed three times a year. The analysis for the four months from January to April 2014 shows that, for the 19 potential specific audit tests for each audit sample, results fell below 90% compliance standard for only two audit tests. The shortcomings in those two tests were about potential non-compliance not being identified.
2.28
All tests showed that the statutory clock was stopped appropriately when needed.
2.29
Recently, Auckland Council carried out an internal audit looking at the reasons for delays in granting consents. Common reasons were:
- "on hold" process not followed, such as the clock not being stopped when it should have been, so the processing time appeared to be longer;
- staffing problems (in only one office); and
- filing or system errors.
2.30
A more significant finding was that only 38% of the consent applications that went over time had reasons for the time overrun recorded.
Our observations about the processing of building consent applications
Timeliness
2.31
In 2013/14, Auckland Council improved how often it met the statutory time frame for issuing consents and was above its 95% target. It is difficult for a building consent authority to comply completely with the 20-working day time limit for any prolonged period. This is especially so when there are large and complex commercial developments. When we consider that Auckland Council issued 17,000 consents in 2013/14, a factor of 1% over time amounts to about 170 consents a year.
2.32
It appears that Auckland Council better met statutory time frames for granting consents in 2014 than did other large local authorities.
2.33
However, we recommend that Auckland Council's target be raised to at least 98%, with graduated increases in future years.6 Specific targets should also be set for residential and commercial consent time frames.
2.34
We consider that the measure of consents granted within 40 working days is most appropriate. The architectural firms we spoke to work on the assumption of a six-week to eight-week turnaround. Although Auckland Council has recorded that, on average, 80% of consents are granted within 40 days, this appears not to be a target. We consider a target should be set and that more exacting targets should be set for future years. Auckland Council's intended projects to improve efficiency can then be measured against these targets.
Processing workflow
2.35
We observed that relying heavily on paper-based processing limits how efficiently Auckland Council can process consent applications. Processing consent applications online would:
- increase the speed of lodging applications;
- bring savings to the applicant in time and cost (such as printing and posting costs);
- bring savings to Auckland Council by not having to scan application documents;
- offer the possibility of doing more processing tasks in parallel; and
- reduce clutter and storage requirements.
Requests for Information
2.36
Staff at the architectural firms we spoke to criticised the RFI process and said that, more often than not, the clock was stopped towards the end of the statutory period. They suggested that a late RFI, with the statutory time limit looming, gave Auckland Council more breathing space. We asked Auckland Council whether it had any data that showed the relative distribution of RFIs during the 20-day period. Unfortunately, there appears to be none. Auckland Council staff told us that they believe that RFIs were usually sent out soon after the start of the statutory period.
2.37
We also noted that Building Control staff have said that, to speed up the RFI process, staff should use email more, including copying in owners when sending emails (rather than just the builder or architect). Auckland Council's internal policy encourages processing staff to telephone the applicant to explain any problems. We consider that telephone calls supported by email messages sent to all involved could result in more timely responses from applicants.
Processing productivity
2.38
In 2014, an MBIE survey of 48 building consent authorities found that 79% of authorities spend five hours or less assessing a simple residential consent. Four in five authorities take 11 hours or longer to assess a complex commercial consent application. Auckland Council's performance looks to be in line with this, but it is difficult to accurately compare because the MBIE survey categorised consents into four types, and Auckland Council has six types of consents.
2.39
Overall, we recommend that Auckland Council find ways to reduce the time it takes to process building consent applications.
| Recommendation 2 |
|---|
We recommend that Auckland Council reduce the average time it takes to process building consent applications by:
|
Building inspections
Inspection workflow
2.40
At various stages during construction, builders need to arrange inspections to ensure that their work complies with the conditions of the building consent. Demand drives inspections, with builders telephoning Auckland Council to book inspections. There is a mid-afternoon cut-off each day for booking. Most inspections are done the next day, although final inspections need three days' advance booking.
2.41
Each afternoon, after the telephone booking cut-off, Auckland Council allocates all the inspections required for the next day to individual inspectors.
2.42
Each morning, inspectors go to their base offices to get their assigned inspections. When necessary, inspectors in one area may be assigned to work in other areas where there is high demand.
2.43
Auckland Council's website outlines and describes the types of inspections that might be necessary.
2.44
Until late 2014, inspection documents were in hard copy. In 2015, Auckland Council introduced electronic tablets for recording inspections.
Number of inspections
2.45
In 2013/14, about 148,000 inspections were carried out on building work. This compares with 137,000 inspections in 2012/13, an increase of 8%. More than half of the inspections were of building alterations and renovations. Most of the remainder were of new residential buildings (see Figure 5).
Figure 5
Inspection types as percentage of total number of inspections, 2013/14
Inspection productivity
2.46
Each new residential building consent application leads to an average of 12 inspections. Each new commercial building consent application leads to an average of 14 inspections. There is an average of 5.7 inspections for each alteration or renovation.
2.47
The 2014 MBIE national survey stated that the average number of local authority inspections was eight for a simple residential consent and 11.5 for a complex residential consent. The MBIE survey did not have an "alterations and renovations" category, so this cannot be directly compared.
2.48
At the time of our audit, there were 88 inspectors in Auckland, with job vacancies for a further 12 inspectors. Until recently, Auckland Council has assumed that inspectors would do an average of 6.7 inspections a day. Auckland Council also monitors productivity by office and staff member.
Inspection quality assurance audits
2.49
Every month, inspection quality assurance audits are carried out – 87 audits were carried out in the four months from January to April 2014. Auckland Council's analysis of this period shows that, for the seven specific audit tests for each audit sample, all results were above the 90% compliance threshold.
Our observations about building inspections
Number of inspections
2.50
The number of inspections carried out each month increased steadily in 2012/13 and 2013/14. The projected inspection numbers are forecast to increase further from July 2014 because of inspections arising from Special Housing Area building consenting and construction.
Inspection workflow
2.51
At first glance, Auckland Council's ways of booking, allocating, and recording building consent inspections appear to be outdated. Building Control relies on builders to telephone in. There is a compressed time in which to allocate inspections and paper recording of inspections. However, the MBIE survey shows that, nationwide, 97% of inspections are booked by telephone. Also, booking by telephone remains the most practical way for builders on the job to let Auckland Council know when they want an inspection. Recently, Auckland Council has set up a "builder app" for booking inspections.
2.52
Auckland Council is introducing a major improvement to recording inspections. Inspectors will use electronic tablets to record inspections. This will instantly update the building consent file. The tablets were due to be introduced in June 2014 and fully in use by December 2014 but, because of IT problems, the introduction was delayed until January 2015.
Productivity of inspectors
2.53
Auckland Council expects, and we agree, that introducing the electronic tablets for inspectors to record inspections will allow officers to carry out a further three inspections each a week. This will take the daily average from 6.7 inspections to 7.3 inspections for each officer. Much of the productivity gain will be that inspectors no longer have to start each day at their base office. If the next-day allocations are emailed to the inspectors, they can go directly to inspection sites. This will save time and reduce vehicle running costs.
2.54
Auckland Council also has initiatives to reduce the number of inspections for some types of residential buildings (see Part 8).
Quality assurance
2.55
Staff at the architectural and building firms were generally complimentary of the inspection regime and felt that the inspectors were helpful and practical in their approach. However, they noted:
- instances where inspectors were not familiar with new building products;
- that the booking of inspections for either a morning or afternoon inspection window was too broad – they said that the slots should be narrowed to 1-2 hours so that builders – especially those responsible for many sites – could use time more efficiently; and
- that the number of inspections needed, especially for simple residential dwellings, was expected to reduce.
Code compliance certificates
Applications for code compliance certificates
2.56
Under section 92 of the Act, an owner must apply to a building consent authority for a code compliance certificate after all building work to be carried out under a building consent granted to that owner is completed. The application must be lodged as soon as practicable after the building work is completed and in the prescribed form.
2.57
Under section 93 of the Act, a building consent authority must decide whether to issue a code compliance certificate for building work within 20 working days of the date of application or, if no application is made, the expiry of two years after the date on which the building consent for the building work was granted. There is provision in the Act for a further period if this is mutually agreed.
2.58
Auckland Council has a dedicated team at its central office to process code compliance certificate applications.
Number of code compliance certificates
2.59
In the year to June 2014, 15,700 code compliance certificates were issued. The number of code compliance certificates issued varies markedly from month to month, because it is driven by demand. Often, people apply for a code compliance certificate only when they sell a property.
Meeting the statutory time limits
2.60
Auckland Council processed 98.5% of code compliance certificates in 2013/14 within 20 working days. Its "target line" is 95%.
2.61
The 2014 MBIE survey of local authorities shows that 80% of "residential simple" code compliance certificates are issued within 10 working days, and 90% are issued within 20 working days.
Quality assurance audits of code compliance certificates
2.62
Every month, quality assurance audits are carried out on code compliance certificates issued. Seventy-six of these audits were carried out on work completed between February and April 2014. The results show that Auckland Council's compliance with the correct procedure for requesting RFIs and the recording of information identifying the "Licensed Building Practitioner" fell below the 90% threshold.
2.63
Recently, Auckland Council carried out an internal audit of the reasons for delays in issuing code compliance certificates. Common reasons for the delays included not following the correct process for "on hold" applications and file or system errors. A more significant finding was that only 31% of the certificate processing that took longer than the designated time had reasons recorded for the overrun.
Our observations about the processing of code compliance certificate applications
2.64
Although processing applications for code compliance certificates can be done at any time, it is more straightforward if done immediately after the final inspection. The greatest push for code compliance certificates comes from lending institutions and insurers. Banks will not approve mortgages and insurers will not insure a building until they have seen the code compliance certificate.
2.65
The architectural and building firms we spoke to queried the extent of paperwork required for a code compliance certificate to be issued. At one building firm, a staff member worked almost full time preparing and submitting documents for code compliance certificate applications. Staff at firms criticised inconsistent interpreting requirements – particularly the extent of "producer statements" needed.
2.66
There appears to be scope for electronic scanning and lodgement of code compliance certificate information, which would make the process more efficient.
2.67
Most building consent applications result in a timely code compliance certificate. Where no code compliance certificate has been issued 24 months after the issue of the building consent, Auckland Council then decides whether or not to issue the code compliance certificate. This decision is made even if the applicant has not applied for the certificate. The longer the time elapsed between a consent being issued and an application for a certificate, the more difficult it is for Auckland Council to progress an application. To enable better estimation of future resource requirements, Auckland Council should monitor the number of consents that are more than two-years old where no code compliance certificate has been issued.
Management reporting on Building Control's performance
2.68
Here, we outline the main features of internal reporting of "frontline" performance to Building Control managers.
2.69
We focused on how Building Control reported on application lodgements, the processing of building consent applications, inspections, and code compliance certificates. However, we noted that Building Control's reporting included all the work that it is responsible for.
2.70
Our audit focused on the nature of the output reports. We did not seek to verify the accuracy of underlying information or the systems used to collate data.
Gathering data
2.71
Building Control keeps comprehensive statistics for each of its work streams. Data is collected daily and covers:
- the number and value of consent applications lodged and rejected;
- the number of consent "pre-application" meetings;
- the number of consent applications processed:
- within and over the statutory 20 days;
- within 40 working days;
- "on hold" and work in progress;
- the estimated building value of issued and invoiced consents;
- the number of inspections and site visits; and
- the number of code compliance certificates lodged and completed within and over the 20-working-day limit.
2.72
Building Control gathers data from each area office as well as the in-house business unit, Manukau Building Consultants.
2.73
The data is also analysed, where relevant, in residential and commercial building categories.
Management reports
2.74
Several regular reports are produced using the data, including:
- weekly performance reports on consent applications (lodged, processed, and on hold), inspections, and code compliance certificates – these are analysed by area office;
- a monthly performance report – this also includes Land Information memorandums, swimming pool inspections, request for services, and certificates of acceptance; and
- monthly "dashboard" reporting – this is an A3 page summarising financial results, "customer outcomes" (throughput numbers), "processes and activities", and "highlights and challenges".
2.75
A "live" risk register is also kept. It records main risks for each item, key mitigation strategies, and the residual risk.
Timeliness of reports
2.76
The monthly reports are available three working days after the end of the calendar month.
Audience for the reports
2.77
The monthly reports are sent to the Chief Operating Officer, the General Manager – Building Control, and the functional managers reporting to the General Manager – Building Control.
2.78
Fortnightly meetings of the Building Control management team discuss the weekly and monthly reports. The meetings also discuss:
- updates to policies and procedures;
- the outcome of technical, compliance, and competency assessment audits;
- risks;
- health and safety;
- human resource matters; and
- updates on new initiatives.
Our observations about management reports
2.79
The management reports are succinct, easy to read, and make extensive use of graphs, colour, and trend indicators. The reports are made available in a timely fashion.
2.80
The monthly performance dashboard includes a lot of information on an A3 page but remains easy to read. The information is presented in quadrants. One quadrant is termed "highlights and challenges". This gives succinct updates of the month's highlights and challenges and the status of transformation initiatives and efficiency-saving initiatives.
2.81
It appears that the management reporting informs Building Control managers of activity, performance against targets, and aspects requiring attention.
2.82
Despite our positive view of how management reports are presented, we consider that Auckland Council could make improvements, including:
- distinguishing better between reporting information about "throughput" or processing numbers compared to reporting information measuring performance;
- introducing more stringent targets to progressively reduce the average time taken to process building consent applications;
- introducing more stringent targets to progressively increase the percentage of building consent applications completed within 40 working days;
- introducing a target to reduce the work in progress "pipeline" – consents on hold or being processed;
- providing information about waiting times for inspections, such as what percentage of inspection requests meet the target of next-day inspections; and
- monitoring the number of consents that are more than two years old so that future resource requirements can be estimated.
2: Special Housing Areas are areas where fast-track development of affordable housing can take place. Special Housing Areas are a tool provided for in Auckland Council's agreement with the Government, the Auckland Housing Accord, and accompanying Housing Accords and Special Housing Areas legislation, aimed at boosting Auckland's housing supply.
3: Percentages are rounded to the nearest whole percent.
4: The former Auckland City Council and North Shore City Council had tracking systems, which are still used by some receiving offices. The other former local authorities did not.
5: Section 30A of the Act states that: "A national multiple-use approval establishes that the plans and specifications to which it relates comply with the building code." A national multiple-use approval does not confer the right to carry out building work that requires a building consent.
6: Auckland Council is currently achieving 98%. It would be inappropriate to allow standards to fall from current achievements.