Ms PATTEN (Northern Metropolitan) — I would like to just briefly speak to the Building Amendment (Enforcement and Other Measures) Bill 2016.
An honourable member — Briefly.
Ms PATTEN — I know; it is a big bill, and I have got 45 minutes to speak on this rather large bill, so shall I start with ‘At the preliminary point’?
Honourable members interjecting.
Ms PATTEN — No, I will not, Mr Dalidakis and Mr Melhem. I am going to confine my remarks on the bill specifically to proposed section 16B, which as we know arose largely from the illegal demolition — and the tragic demolition — of the Corkman pub in Carlton.
An honourable member — The wanton destruction.
Ms PATTEN — The wanton destruction. And I think we all expressed our regret over that absolute wanton destruction of a fine watering hole that has many great memories for many of us. All of us would have received emails and letters of outrage about that demolition because of the quite obviously significant heritage value of that hotel. People were furious that the developers were able to buy the site and get legal advice that the fines would be $388 000, and the developers effectively factored those fines into their business plan as part of a cost of business.
An honourable member — Outrageous.
Ms PATTEN — It is outrageous. So there do need to be effective and strong penalties to discourage this type of unscrupulous activity. New section 16B is meant to do that, but I am concerned that some parts of this section may have missed the mark, and critically, because their advice on the Corkman was that $388 000 was okay, they could consume that and they factored that in as a cost of business. Now the maximum fine is $466 000, so I actually think we could probably have increased the financial deterrent in this section for a body corporate. I appreciate that it is now an indictable offence — I will mention that in a minute — and that also is one of my concerns about this, but if you are building a multistorey apartment block with a value uplift of tens of millions of dollars, factoring in $466 000 — —
Mr Davis — It is not much.
Ms PATTEN — It is not much, Mr Davis. It is still a cost of business. We looked at the Corkman, and they were only going to make $4.7 million, and with a fine of $388 000, or even with the new fine, it is still only a 9 per cent variance on that, so there was some good money to be made by ignoring this.
The other concern with the section relates to concerns that the Housing Industry Association has raised with me and no doubt with many of you, and I apologise for missing some of the contributions here. They have indicated that the language of the section is too wide and could lead to small builders being charged with an indictable offence for minor infractions — so building a pergola slightly outside what the building permit allows, prior to a building permit being approved laying a slab that is 2 metres too wide or other minor infractions. But even if they are only fined a small amount, having an indictable offence on your record is very serious. It will affect your ability to travel, it will affect your ability to seek further employment and a whole range of things.
I was somewhat concerned, and I did have conversations about this with my colleague Ms Dunn last night and she did not allay my concerns. Zealous local governments who are furious, who may have refused a development only to have VCAT overturn that decision — zealous councils may not have liked a particular builder or a particular site — could take action under this new section, section 16B. And I appreciate that that is not — —
Ms Dunn — On a point of order, Acting President, I am just concerned that the conversation that we might have had as an aside might have been taken out of context and with the potential that it has not been properly represented. I am not suggesting that it is an enormous slur or deliberate by any stretch, but I am just concerned that it might have been taken out of context in terms of what I was saying.
Ms PATTEN — I would be fine to strike it.
The ACTING PRESIDENT (Mr Morris) — Order! Thank you, Ms Dunn. I think I might take that as a point of clarification rather than a point of order at this point.
Ms PATTEN — Thank you, Acting President. So I raised these concerns with government, and I would have to say to the government’s credit they appreciated those concerns and have agreed to write to all local councils to tell them to direct all potential prosecutions under section 16B to the Victorian Building Authority. I am quite satisfied that that will provide a measure of assurance and a measure of security for what may have been seen as a vexatious charge, not that there may have been one. However, I think this provision could be strengthened with that requirement written into law, and I believe that the government should consider doing that in the future.
I would also consider increasing some of the penalties. If the owner of the Corkman Hotel thought $388 000 was the cost of doing business, how many may think $466 000 is the cost of doing business? I appreciate that we could send them to jail, but I also appreciate that under corporate structures that is very often difficult and is rare. We need strong legislation to protect our cultural heritage, but that needs to be directed at the problem, and the problem is unscrupulous developers. To hit them where it hurts, you need to target the money, and the penalties we have are not enough. I have raised this with my crossbench colleagues, who largely agree, but I am happy that the government has signalled their willingness to consider further changes.
