Chapter 19: Land-use planning and building regulation
19.1 Land-use planning regimes and building regulations govern how and where homes, businesses and infrastructure are built. They influence the exposure and vulnerability of structures and communities to natural hazards. They can also be used to mitigate risk and improve resilience.
19.2 Land-use planning decisions and exposure to risk are inextricably linked. Existing, or ‘legacy’, risk needs to be identified and communicated, and proportionate action taken to reduce risk. Clear risk information supports individuals, communities, and governments to take informed action to manage those risks. Governments should work together to address legacy risk.
19.3 The likelihood of increases in the severity and frequency of natural hazards should be taken into account in land-use planning and building decisions. These decisions should be informed by the best available data on current and future risk.
19.4 The effectiveness of some standards intended to mitigate natural hazard risk is currently unclear and should be assessed to ensure that resources spent on mitigation efforts are effective and proportionate. Consideration should be given to the costs and benefits of amending the National Construction Code to add the resilience of buildings to natural hazards as an objective, in addition to the protection of life.
How and where we build and the impact of natural hazards
19.5 Australia’s long history of natural hazards and their resulting disasters have highlighted the extent to which communities and assets are exposed and vulnerable. Over 3,100 houses were destroyed and more than 100 Local Government Areas were impacted by the 2019‑2020 bushfires.  In the 2010-2011 Queensland floods, around 28,000 houses needed to be rebuilt, and many more were damaged. 
19.6 How towns and cities are planned and the manner in which homes and infrastructure are built have long lasting ramifications.  Relevant to natural hazards, these decisions influence the exposure and vulnerability of communities and assets. Good land-use planning and building decisions can mitigate risk and improve resilience.
Land-use planning influences exposure
19.7 Land-use planning is a shared responsibility of state, territory and local governments. State and territory governments have primary responsibility for land-use planning regulation, but many relevant functions and responsibilities can be, and often are, delegated to local governments. Local governments are responsible for developing and applying local planning schemes, including by making development approval decisions. The exceptions are the ACT and the NT, which have full responsibility for the land-use planning process. 
19.8 Broadly, land-use planning governs how land can be used and developed. As such, it affects the exposure of communities to natural hazards. ‘Land-use planning’ includes, but is not limited to:
- Zoning – the process by which governments classify or ‘zone’ what a land area can be used for. For example, a zone can determine if residential buildings can be located in a given area and to what level of density.
- Urban safety – including overlays and other development restrictions that relate to what development can occur in an area and the standards that must be met for new developments, in relation to how this influences the safety of the inhabitants of this environment.
- Development approval – the process by which a decision maker approves whether a proposed development can occur. For example, where a local council may approve a new housing subdivision.
19.9 Land-use planning decisions take into account a wide range of objectives including cost, amenity, and specific community desires.  We focus on the connections between land-use planning and managing natural disasters.
Building regulations influence vulnerability
19.10 Building regulations determine how built assets are designed and constructed and so affect the vulnerability of built assets to natural disasters. ‘Building regulations’ in this report encompasses both building standards and the instruments which govern the use of these standards. 
19.11 Laws regulating construction in each state and territory are based on the National Construction Code (the Code). The development and maintenance of the Code is the responsibility of the Australian Building Codes Board (ABCB), a joint initiative of all governments. The Code prescribes the minimum necessary requirements for safety and health, amenity and accessibility, and sustainability in the design, construction, performance and liveability of new buildings – and new building work in existing buildings – throughout Australia. 
19.12 The Code is given effect by separate legislation in each state and territory. While the Code seeks to achieve a nationally consistent building safety standard, the implementing legislation in the states and territories adopt the Code subject to various restrictions and amendments. The Code does not, therefore, operate fully consistently across jurisdictions. 
19.13 In setting out building requirements, the Code references numerous standards that can meet its performance-based requirements. These standards can be written by the ABCB or by non-government institutions, such as Standards Australia.  Some standards are specifically aimed at reducing risk from natural disasters, such as:
- · Australian Standard (AS) 3959 - Construction of buildings in bushfire-prone areas. AS 3959 prescribes building and engineering standards to which homes should be constructed, to be safe under different levels of bushfire risk (Bushfire Attack Level, or BAL),  and
- the steel framed construction in bushfire areas National Association of Steel Framed Housing standard. 
Existing risk to the built environment
19.14 Risk from natural hazards to lives and property is influenced by past decisions such as how and where communities, businesses, infrastructure and homes were built. While the consequences may only be felt decades later, this risk is inherited by those who are responsible for the built environment today. This existing risk is often referred to as ‘legacy risk’.
19.15 We heard that natural hazard risks to existing structures or communities are significant, yet apparently are not sufficiently addressed in most land-use planning regimes.  The Property Council of Australia told us that ‘inappropriate building design and construction in the past has been widespread, leading to a built environment susceptible to damage’. 
19.16 Upon purchase, the buyer of a property assumes any additional natural hazard risk created during construction.  But buyers may be unaware of the risk they are assuming and the costs of this risk.  Mr Mark Crosweller AFSM, former Director‑General of Emergency Management Australia, gave the example of parts of Wagga Wagga, where residents face flood risk due to institutional decisions that were not within residents’ control. 
19.17 When risk is identified and communicated, and incentives to reduce risk exist, individual businesses and communities gain the knowledge and impetus necessary to tackle the risks for which they are responsible.
Identifying natural hazard risk
19.18 The first step to reduce natural disaster risks to existing homes and communities is to identify the extent to which they are exposed and vulnerable. The National Disaster Risk Reduction Framework, endorsed by Australian, state and territory governments in 2020,  listed the following priority:
Disaster risk information is freely disclosed [and] it is our collective responsibility to efficiently equip decision-makers in all sectors with the information and capabilities they need to make decisions that reduce disaster risk. 
19.19 Cross Dependency Initiative (XDI), a business specialising in risk analysis, has modelled and analysed natural hazard risks. XDI estimates that over 380,000 properties are currently exposed to ‘high natural hazard risk’ and this may grow to 735,000 by 2100 – this is in the absence of any new houses being built, due to an increasing frequency and severity of hazards.  See Figure 72.
Note: Blue and green means less than 1% of all properties in an area are exposed to high risk as XDI has defined it, while orange and red mean proportionally more properties (where red, up to half) in an area are exposed to high risk.
Figure 72: Predicted distribution of exposure to high natural hazard risk in 2100. 
19.20 The Insurance Council of Australia (ICA) noted that in the 2019‑2020 fire season, 99% of buildings destroyed were within 500m of bushland, and 74% of buildings lost were constructed prior to the introduction of building standard AS 3959.  Related work from the Bushfire Building Council estimates that:
90% of buildings in bushfire prone areas in Australia have not been built to bushfire planning and construction regulations because they were built prior to regulation being applied. 
Data to identify risk accurately
19.21 Estimates of exposure draw on available data on the distribution of hazards and location of communities, businesses and infrastructure. 
19.22 Vulnerability assessments consider the design and construction of buildings and infrastructure and the capacity and resilience of communities. 
19.23 Identifying and addressing legacy risk requires exposure and vulnerability data that are accurate, useful and able to be used to clearly communicate risk to households.  Comparability and consistency of risk data at a national level has also been raised as desirable,  potentially to deliver efficiencies, avoid duplication, and improve understanding.  Experts, business groups, and the insurance industry have told us of gaps in exposure and vulnerability data,  which can present a barrier to informed decision making. 
19.24 We heard calls from governments, government institutions, and the private sector for this information to be made publicly available, to maximise its benefits and to improve accountability.  The Australian Government said that:
The Commonwealth supports making information for hazard risk and vulnerability information as open and publicly available as possible, noting privacy, commerciality and contractual issues may need to be resolved in order to do so for much of this data. The Commonwealth considers it important end-users, including citizens and local community groups, are supported in understanding and interpreting the natural hazard information and data, and ways to manage natural disaster exposure and risks. 
19.25 On the other hand, privacy and market impact considerations suggest possible adverse consequences of detailed risk exposure and vulnerability information.  For example, revealing the risk profile of properties could potentially affect their value, and could expose state, territory and local governments to liability.  Data identifying exposure and vulnerability may also be costly if too detailed or, if not detailed enough, of limited value.  These concerns need to be carefully weighed in determining strategies to address legacy risk, but should not preclude strategies being developed.
19.26 When individuals, businesses, and governments have access to good information on risk, they can make informed decisions to manage this risk. Strategies with measurable goals and targets are acknowledged as a way to improve accountability for actions,  and can also serve to promote coordination. For example, the Queensland Inspector-General Emergency Management (IGEM) has established a Standard for Disaster Management in Queensland to give the community and entities a greater understanding of which outcomes to pursue and whether risk management is achieving these outcomes.  The Victorian IGEM also uses risk reduction targets to monitor progress,  and noted that for a shared responsibility for risk management to be most successful, ‘performance targets, and appropriate outcome measures must be clear and comprehensible to communities’. 
19.27 States, territories and others including insurers, business groups and expert bodies expressed broad support for Australian, state and territory governments to work together to agree a national approach to addressing ‘legacy risk’.  WA in particular said that an agreed national approach is needed to address legacy risk in relation to a number of areas.  Some bodies, such as the ICA and the Australian Local Governments Association expressed interest in being involved in any process to agree a national approach.  NSW said it would not support an approach that undermined state responsibilities in this space.  We agree with this sentiment.
19.28 States and territory governments should be responsible and accountable for addressing legacy risk. The Australian Government should work with states and territories to address risk where it is efficient and effective to do so.
Communicating natural hazard risk
19.29 In addition to information availability, the communication of clear risk information can enable purchasers, prospective occupants, and builders to make more informed decisions about where to buy and/or live, how to design and build structures and how to manage land around these structures. State and territory governments should work together, with the Australian Government as appropriate, to improve the communication of clear, comparable, and understandable risk information.
19.30 Risk information is most useful when it is communicated to people when they can use it to make important decisions. Decisions like buying a house, making a property more resilient, or taking out insurance can be points at which to consider better communicating risk. For example, in real estate sales, this could be achieved by property or rates notices issued by local governments, or in insurance policies and renewal notices. Each different form of communication need not require a new assessment of risk.
19.31 Some states already have programs in place to notify home buyers of their natural hazard risks when a home is purchased, but applicable schemes vary considerably. 
19.32 A rating system or a similar mechanism could be considered as a way to communicate risks.  We note that in October 2020, Emergency Management Australia was considering a proposal from the Bushfire Building Council for a ‘star rating’ aimed to achieve this. 
19.33 We also note that it would be desirable if communication of risk was linked to information on obligations and options for risk management. In this way, it may also assist people, businesses and governments to comply with measures intended to reduce risk. We heard that letting compliance slip can lead to increased risk and degrade over time the value of actions taken to reduce risk.  See Figure 73.
Figure 73: Example of a house built to be resilient to natural hazards becoming less so due to a lack of maintenance and compliance with protective measures 
19.34 The Queensland Government questioned whether there is a need to directly communicate risk to people when they can access government websites that already host this information.  The answer is simple: many people do not.  However, the person who goes out of their way to understand their risk and the person who does nothing face the same risk. Further, there may be differences in the extent to which different people can understand risk, even where some information may be available.
19.35 Concerns may arise in respect of privacy and market impacts of the disclosure of risk information. These may be affected by the frequency with which information is updated and where it is applied.
19.36 In addition, if nationally consistent measures to communicate risk are to be developed, nationally consistent definitions of risk will be needed.  Developing nationally consistent mechanisms to communicate risk may avoid future issues such as the confusion that could arise if two states have a very similar mechanism, such as a star rating, which communicate different information in each jurisdiction. It may also reduce duplication of development between jurisdictions. As such, national consistency is desirable if it is efficient and of overall benefit.
19.37 However, when risk is not mitigated, perhaps because the risk is unknown to the affected individual, the costs are borne not only by that individual but also by governments and others in the community.  Peak bodies, consumer groups, and risk analysis businesses have each pressed the need for improvements to the communication of natural hazard risk.  Natural hazard risk information communicated to households should include information, to a useful and practical level of detail, on expected exposure and vulnerability of a property within a designated ‘hazard prone’ area. We discussed exposure and vulnerability data in Chapter 4: Supporting better decisions.
19.38 Economic studies note that ‘behavioural nudges’ can be effective in influencing people to take positive actions to improve factors within their control and for which they are responsible. 
19.39 Previous inquires have also recommended better direct communication of risk.  Stakeholders broadly support a mechanism to communicate risk, with most states supporting in principle and noting they would like to be closely involved in any development process.  We agree that the development process should be collaborative.
Recommendation 19.1 Communication of natural hazard risk information to individuals
State and territory governments should:
- each have a process or mechanism in place to communicate natural hazard risk information to households (including prospective purchasers) in ‘hazard prone’ areas, and
- work together, and with the Australian Government where appropriate, to explore the development of a national mechanism to do the same.
Incentivising proportionate action to reduce risk
19.40 Mitigation actions in the built environment can occur on many scales, from big government-funded mitigation such as the construction of flood levees, to individual‑level mitigation that a household or business can undertake, such as upgrading a roof to be cyclone-resilient or installing sprinkler systems to protect against ember attack. Incentives for people to take proportionate and cost-effective mitigation action to reduce risk should be encouraged.
19.41 Depending on the hazard, the appropriate scale of mitigation can vary. For example, a flood levee can be more cost-effective than requiring every house in an area being rebuilt to be raised above expected flood-levels.
19.42 In other inquires and in a number of submissions from private sector bodies, state and local governments, and emergency responders we heard a desire for greater investment in mitigation.  We also heard that mitigation in many cases can be a cost-effective means of managing risk.  The CSIRO contended:
A $1 investment in climate adaptation or disaster risk reduction saves between $2 and $11 in post-disaster recovery and reconstruction. 
Incentives can come from the public sector, private sector, or both
19.43 We note that the ICA already works with governments to identify more extensive mitigation projects and their likely insurance savings, through programs such as the Mitigation Priorities Project and the Mitigation Valuation Service.  Governments and industry should continue to work together to identify effective large-scale mitigation projects. In this chapter, we focus on how individuals, supported by government and business, can be encouraged to undertake actions to mitigate risk and increase resilience to natural hazards.
Figure 74: Flooding in February 2020 in Jandowae, Queensland 
19.44 For some existing homes and structures, retrofitting and other individual-level mitigation options can reduce a structure’s vulnerability to natural hazards, and help protect the safety of people.  These actions may include:
- upgrading a property and relevant features (such as water tanks, sprinkler systems, and building materials) to a higher standard of resilience
- clearing of vegetation within a certain area of a building,  and
- the construction of hazard-resistant shelters.
19.45 It is important that incentives and measures are practical and cost-effective. One way to achieve this is to have standards for specific mitigation actions, which have been evaluated to see if they achieve their objectives and pass a cost-benefit analysis.  Two examples raised are:
- AS 5414:2014: Bushfire water spray systems – this standard sets out the requirements for building a bushfire sprinkler system,  and
- the Performance Standard for The Design and Construction of Private Bushfire Shelters  – the ABCB notes that it is currently developing quantified NCC performance requirements to replace the current NCC requirements for private bushfire shelters. 
19.46 We heard a number of calls for better incentives to reduce the risk to existing properties.  However, upgrading homes to comply with higher standards can be cost-prohibitive or, in some cases, impossible.  This is an important consideration when incentivising action.
19.47 Legislation can provide for required mitigation. However, it can be impractical, inappropriate and costly to regulate to compel people to upgrade or retrofit buildings.
19.48 States and territories presently do not require upgrading or retrofitting of existing homes to address natural hazards.  NSW, Victoria and SA, in some cases, require homes to be upgraded to a higher building standard for significant building modifications. The thresholds for activation of higher standards vary by state, and can also vary by local government area. 
19.49 Insurers and consumer groups have called for governments to directly subsidise mitigation to encourage people to take action.  The Australian Competition and Consumer Commission (ACCC) noted that direct subsidies for mitigation can be relatively efficient compared to other subsidies such as subsidising insurance premiums for households. 
19.50 Direct subsidies for mitigation were offered in Queensland following the 2011 floods. Households in the Lockyer Valley were incentivised through a voluntary land-swap program to leave the flood plain.  The Household Resilience Program subsidised households to retrofit their roofs in cyclone-prone areas. 
19.51 States, territories and local governments should consider if, where, and how it is appropriate for them to create incentives for natural disaster mitigation.
The insurance industry can encourage mitigation
19.52 Insurers can encourage mitigation actions through lower insurance premiums. If insurance prices risk, lowering risk should lower premium costs.  This in turn should lead to a virtuous cycle of improved insurance affordability and effectiveness – which, as seen in our discussion on the role of insurance in Chapter 20: Insurance, is in the interests of governments, insurers and individuals.
19.53 Mitigation activities which are recognised by insurers can improve insurance affordability and effectiveness. A government-funded flood levee in Roma, Queensland was recognised,  and some insurers recognised the Household Resilience Program mitigation upgrades targeting cyclone resilience in Queensland.  Under this program, the roofs of almost 2,000 homes were upgraded using government grants. The ICA noted that the upgraded homes were 63% less likely to suffer a total-loss, and insurers decreased premiums for these retrofitted homes by an average of around 10%. 
19.54 Nonetheless, despite the recognised value of mitigation, individual-level mitigation is not uniformly encouraged by insurers. The Productivity Commission and ACCC noted that individual-level mitigation actions to reduce risk are rarely recognised in premiums, and that this is an area for improvement in insurance pricing. 
19.55 Some insurers contended this is due to poor information on how mitigation activities affect risk, which results in insurers being unable to reflect lowered risk through lowered premium prices. 
19.56 To step through the problem of recognising individual-level mitigation and our proposed recommendation to help solve it:
- It is presently difficult for insurers to recognise where individual-level mitigation will reduce risk. It is also difficult for households and businesses to know which mitigation options will be most cost-effective.
- As the cost of insurance premiums reflects risk, when risk is reduced, the cost of premiums should reduce. By developing common guidance on mitigation actions that the insurance industry has recognised as lowering risk:
- insurers gain access to an easier way to evaluate where individual-level mitigation lowers risk, and
- consumers can more easily understand what options are available and the financial and risk-reduction benefits of a given option.
- Through this combination, barriers to individual-level mitigation, and barriers to insurers recognising this mitigation, should decrease. As such, financial incentives to mitigate should increase, enabling a virtuous cycle that benefits both insurers and consumers. See Figure 75.
Figure 75: Cycle of insurer-recognised mitigation with financial incentives
19.57 Insurers also noted the cumulative effect of government subsidies for insurer-recognised individual-level mitigation, which can incentivise people to take action where they may not have taken action as a result of insurance-based incentives alone, and noted their concern that insurance-based incentives in isolation may not be sufficient to achieve broader community resilience. 
19.58 Similar mechanisms have been recommended by the ACCC and the Final Report of the NSW Bushfire Inquiry. 
19.59 Insurers, consumers groups, and governments universally support the development of mitigation guidance,  with states expressing an interest in close involvement in development and implementation.
Recommendation 19.2 Guidance for insurer-recognised retrofitting and mitigation
The insurance industry, as represented by the Insurance Council of Australia, working with state and territory governments and other relevant stakeholders, should produce and communicate to consumers clear guidance on individual-level natural hazard risk mitigation actions insurers will recognise in setting insurance premiums.
Future land-use planning decisions
The role of data in land-use planning
19.60 Good land-use planning decisions can mitigate future risks. Decisions about new developments should be based on the best information available on current and future risks. In addition, development in high-risk areas should be avoided unless risk can be clearly communicated and cost-effectively managed. Where new structures are built in high-risk areas, they should be sufficiently resilient for their expected lifespan.
19.61 While we heard that land-use planning regimes have improved recently in relation to managing natural hazard risk,  we also heard calls from peak bodies, insurers, local governments, and emergency response organisations, for further strengthening of land-use planning regimes. 
19.62 Currently, all states permit homes to be built in bushfire and flood prone areas, and the degree to which planning or building standards act to mitigate risk varies across jurisdictions.  Industry groups, local governments, and insurers expressed concern about development continuing to occur in high-risk areas.  Former Commissioner of the Queensland Fire and Emergency Services, Lee Johnson, said that land-use planning ‘is an area of great weakness in the whole system of dealing with the risk of bushfire in Australia,’  and the ICA pointed out:
Although land-use planning has improved in respect to reducing disaster risk … there is still clear evidence of recent planning decisions placing communities at a known and obvious risk of disaster. For example, development in the suburb of Idalia in Townsville is only partially completed, yet it was significantly inundated by flood in February 2019. 
19.63 Good data and information, including hazard mapping, are critical to the effectiveness of land-use planning regimes and building regulations. We heard that there is significant scope for this information to be improved.  We heard from insurers, local governments, peak bodies and experts that some natural hazard risk assessments, including hazard mapping, lack sufficient detail and are apparently not sufficiently integrated into land-use planning schemes.  This can lead to poorly informed land-use planning decisions that increase risks.
19.64 We note that different assets have different considerations in relation to how much risk they can acceptably be exposed to, depending on use, economic-life and other factors. The degree of acceptable risk also depends on asset class – acceptable risk will likely differ between an industrial property and a residential one.
19.65 People may choose to live or build in a high-risk area for multiple reasons, but a decision to take on risk should be an informed decision.
19.66 Since 2002, a number of major inquiries have suggested better integration of risk data into land-use planning regimes.  The 2004 National Inquiry on Bushfire Mitigation and Management, said that, to reduce natural hazard risk from bushfires:
Planning processes [should] ensure that built assets are not placed in areas of high fire risk and that structures meet standards of construction that reduce their vulnerability. 
19.67 All states and territories accept the principle that consideration of risk should be a mandatory requirement in land-use planning decisions, with the exception of NSW, which did not comment but accepted a similar recommendation in the recent NSW Independent Bushfire Inquiry. 
19.68 Land-use planning decisions should consider natural disaster risk. However, in doing so, it is necessary to draw on the best available information. Improved capabilities in data, information, and the tools and services that rely on data and information – as discussed in Chapter 4: Supporting better decisions – should be integrated into land‑use planning regimes.
Recommendation 19.3 Mandatory consideration of natural disaster risk in land-use planning decisions
State, territory and local governments should be required to consider present and future natural disaster risk when making land-use planning decisions for new developments.
The effectiveness of building standards
19.69 Building regulation can also mitigate future risk. The effectiveness of building standards relies on good data and information.
19.70 There is scope to improve the quality and availability of data and information used in these regulations. As better data becomes available, relevant standards should be reviewed in light of those data to ensure that the standard continues to be as effective as possible to mitigate that risk.
19.71 Consideration should be given to whether the present objectives of the Code, including to protect life, (and the corresponding standards used to achieve objectives in the Code) should be extended to protect property as well.
Analysing building standards to confirm their effectiveness
19.72 According to the Australian Business Roundtable for Disaster Resilience & Safer Communities, ‘it is not possible to accurately assess the effectiveness of enhanced bushfire protection measures in reducing estimated annual damage costs’. 
19.73 While a CSIRO study noted that it is likely that AS 3959 - Construction of buildings in bushfire-prone areas reduces losses due to fire,  we also heard that data limitations make it difficult to undertake a robust cost-benefit analysis to assess whether the benefits outweigh the additional cost of building to AS 3959.  We also heard that aspects of fire behaviour such as ember attack and the proximity of other houses are apparently not adequately addressed in the current standards. 
19.74 While the evidence we heard primarily relates to AS 3959, the principles we discuss in this section can also relate to all relevant building standards. These include structural design standards for other hazards such as AS 1170.2 Wind; AS 1170.3 Snow and ice; AS 1170.4-2007 Earthquake. 
19.75 The period following a natural disaster provides a brief window to collect data to assess which aspects of buildings made them more or less likely to be damaged or destroyed.  Although some bodies such as Risk Frontiers have used existing data to reveal key issues at a high level,  we heard of a desire for improved impact data,  which we addressed in Chapter 4: Supporting better decisions. For instance, CSIRO has suggested that the creation of a national register of planning and building regulation controls that are, or have been, implemented to manage risk as it is essential to estimating vulnerability and eventual performance of built assets.  Currently this information is not aggregated at a state or territory level,  must be requested from individual local governments, and assessments are often too time and resource intensive to perform.  According to Mr Stingemore, Standards Australia:
…the better the data that we have available to us, the better our technical committees are able to set levels within a particular standard … [but] all we really have today are anecdotes and statements available to us that things either did perform well or they did not perform well. 
19.76 The effectiveness of relevant building standards to manage natural hazard risk should be reviewed using the best available data, and better data should be commissioned if current data are inadequate.
Currency of data used in standards
19.77 The ways that data are used in applying building regulations should also be improved.
19.78 In some places the fire danger information used to calculate the Bushfire Attack Levels (BALs) for the purposes of AS 3959 is out of date and does not accurately quantify expected risk.  For example, in the latest 2018 version of AS 3959 BAL the Forest Fire Danger Index (FFDI) values used are from 2009 rather than more contemporary values or a future-looking FFDI for the life of a structure. 
19.79 In some cases a single fire danger index is applied across a broad area, regardless of differences in vegetation and topography. For example, Queensland has an FFDI of 40 for the whole state,  when we were told it should apparently be between 80 and 130. 
19.80 Additionally, there are cases where the fire danger index is very different immediately either side of state boundaries, even where vegetation and topography does not differ, such as where Queensland uses an FFDI of 40 and northern NSW uses an FFDI of 80. 
19.81 In March 2020, the Council of Australian Governments directed the Building Ministers Forum (BMF) intergovernmental body to consider how the Code could be updated to enhance climate and disaster resilience.  The ABCB has informed us that a process is currently underway with CSIRO and others to consider how to better account for future climate risks. 
19.82 The data used in relevant building standards that manage natural hazard risk should be updated to reflect the best data available, and use data projections if these projections are relevant and can be given with confidence.
The aims of the National Construction Code
19.83 The Code presently aims to protect life, but not property.  Mr Sullivan, Insurance Council of Australia, noted that the aims of the Code include safety, but ‘it doesn’t stipulate a performance outcome for protecting the property, except to the extent that property protection would save life’. 
19.84 This may mean that, in some cases, proportionate and cost-effective options to protect a house are overlooked because they do not also function to protect life. The ICA gives the following example:
Strata buildings are designed to withstand high windspeeds to ensure they don’t collapse. However, window and door flashings are not designed to withstand water ingress under high windspeed. As a result, strata buildings in Australia are highly vulnerable to extensive water damage during storms. 
19.85 Another example is noted by the ABCB, which in 2016 considered a study by Risk Frontiers that found that increasing the resilience of roof tiles to hailstorms was likely to have positive economic benefits.  However, the ABCB decided not to pursue updating the criteria for roof tile resilience, because:
It would be difficult to justify any increase in NCC stringency based on the ABCB’s mission (the primary focus of which is not property protection) … as the risk to life safety is negligible. 
19.86 To address these types of issues, the ICA recommended that the Code be updated to include protection of property as an explicit objective in addition to protection of life.  We agree that such an update should be considered. While protecting life should be the top priority, loss of and damage to property caused by natural disasters inflicts a heavy burden on individuals and communities.
19.87 Where the National Construction Code can be expanded in a proven, cost-effective way to improve the ability of a structure to withstand damage and destruction of property from natural hazards, it should be.
19.88 Underneath the Code, should an update occur, the standards that achieve this objective would also likely need to be updated to protect property from damage and destruction, as well as to protect life.
Review of the National Construction Code
19.89 Building more resilient houses comes at a cost, and changing the standards may add to this cost.  Increased costs can be problematic for people who rebuild following a natural disaster. A community group noted:
The additional cost of compliance with existing standards in high bushfire risk areas is reported to be in the range of 25-30% of the normal building cost. If these standards are tightened further, the costs will be prohibitive. 
19.90 All changes to regulate resilience should be proportionate and proven to be cost‑effective. We note that both Australian Standards and the Code are already subject to cost-benefit analyses.  AS 3959 and the Code are also subject to regular reviews.  We commend these initiatives, as they provide reassurance that any additional costs imposed are subject to value analysis, and the standards and code see updates regularly. As we (and Standards Australia and the ABCB) have noted, with better data and information these processes can be further improved. 
19.91 Previous inquires have expressed similar views.  In 2019, the ACCC said the ABCB should ‘expressly consider measures that better protect the interiors and contents of residential buildings from damage caused by natural hazard risk’. 
19.92 States, territories and peak bodies supported the evaluation of the standard’s effectiveness in supporting property survival in a bushfire, suggesting the ABCB conduct this work.  Some states also note the relevance of existing intergovernmental agreements and the BMF  – to this end, the BMF should also consider this recommendation in its ongoing work.
Recommendation 19.4 National Construction Code
The Australian Building Codes Board, working with other bodies as appropriate, should:
- assess the extent to which AS 3959:2018 Construction of buildings in bushfire-prone areas, and other relevant building standards, are effective in reducing risk from natural hazards to lives and property, and
- conduct an evaluation as to whether the National Construction Code should be amended to specifically include, as an objective of the code, making buildings more resilient to natural hazards.
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