In particular to place our view on the record regarding the design, effectiveness and efficiency (including cost) of the WELS Scheme provided by the third review of the WELS Act 2005, being undertaken by Allen & Clarke.
We wish to address opportunities for regulatory reform with comment on the current structure and administration of the Scheme.
We have noted over a number of years that the regulatory and financial burden imposed on industry by the WELS Scheme could be more cost effectively and efficiently organised by combining WELS with WaterMark or at least have them managed and administered by a single government agency. Initiatives such as this would be entirely consistent with the Government’s policy of building a stronger, more productive diverse economy with lower taxes, more efficient government and more competitive businesses by reducing the regulatory burden.
This could be achieved by bringing the administration of the schemes together under a single administration, provided by a government Department such as the Department of Agriculture, Water and the Environment.
The case for reform has also been supported by the following reviews and report since 2007;
Managing the Flow – Regulating Plumbing Product Quality – a 2007 House of Representatives Report strongly urged the alignment of these two schemes:
Quote “The Committee concedes that a greater integration of the two schemes would require legislative change.
However, it believes that such a course is not only desirable, but very necessary, to address industry and community confusion and frustration, to maintain industry and community confidence in the schemes and ensure the quality of the plumbing products in the Australian marketplace and homes.
Consumers and industry could clearly benefit from a closer relationship between these two worthwhile and necessary schemes.”
Dr Chris Guest’s 2010 report following the first review of the WELS Act 2005. His report made the following recommendations:
7.5 (i) A check testing program be established for white goods; and (ii) noting that compliance testing for plumbing products would be covered by ISO Type 5 certification in the event that plumbing products were transferred to the WaterMark certification body, ISO Type 5 should be reviewed for WELS compliance purposes.”
The second independent review report of the WELS Scheme, dated June 2015, also makes comment. Indeed, Recommendation 6 states:
“A unified single product registration process should be adopted for the WELS Scheme and the E3 Program (for whitegoods) and the WELS Scheme and WaterMark Scheme (for plumbing products) – comprising common documentation for registration of common products.”
In addition, the report says;
“it is clear that the current 80 per cent private (industry): 20 per cent public (government) cost-recovery split is unlikely to be equitable or appropriate given the nature and distribution of benefits provided by the Scheme.
Based on the Reviewer’s assessment of the estimated distribution of benefits (e.g., in Section 6.4) and current imposition of costs (Section 7), and consulting literature of the subject (Deloitte 2011 and Australian Government 2014b), a 50:50 cost-recovery split appears to be a more equitable cost-recovery target for the future of the WELS Scheme. This is also supported by industry stakeholders consulted as part of this Review.
Developing a common portal with a unified registration process for products covered by more than one related scheme could reduce direct and indirect costs on industry, as well as administrative costs for government, and reduce the overall regulatory burden and costs on stakeholders of all schemes.”
The value of bringing both schemes under a single administration, in the view of the PPI Group, is an imperative that can no longer be ignored by government.
The WaterMark Certification Scheme is a mandatory certification scheme for certain plumbing and drainage products to ensure that they are fit for purpose and appropriately authorised for use in plumbing or drainage installations. Responsibility for the management, oversight and administration of the WaterMark Certification Scheme rests with the Australian Building Codes Board (ABCB).