Rotting homes bill tipped to hit $11b

The cost of leaky building repairs could be $11.5 billion, not the previously estimated $3.6 billion, according to Rodney Mayor Penny Webster.

She was one of six mayors who met Building and Construction Minister Maurice Williamson this week to talk about resolving the rotting homes disaster and said costs could be much more than previously estimated.

Mrs Webster says the reported costs were horrifying and would have a huge and unfair impact on Rodney ratepayers if the district was merged into the new Super City.

Rodney ratepayers could be lumped with paying for the cost of leaky homes in the metro Auckland region if the region was subsumed into the Super City, she said.

Rodney has one of New Zealand's largest leaky buildings - the 12-level Nautilus tower which dominates Orewa's skyline and where cladding problems are expected to result in a $19 million repair job.

The 41-unit Oyster Cove apartment complex at Gulf Harbour was also the subject of a huge claim and is also in Rodney district.

The Department of Building and Housing's technical review of Rodney's building control operations three years ago found it lacking in 18 separate categories.

These included not meeting legal time frames for processing building consents; not complying with the Building Code; poor staffing levels; training deficiencies, particularly in the technical building control area; policy gaps and issues with computer systems. The department made a string of recommendations needed to upgrade Rodney, which oversees building work worth $400 million annually.

Mrs Webster said yesterday that a review of leaky buildings had found that the national bill was likely to top $11.5 billion, with the vast majority of this cost expected in the metro Auckland area.

Mr Williamson met six metro city mayors on Monday to discuss options on the costs of leaky homes.

"I am not denying we have some leaky home issues in Rodney. However, we are dealing with these and resolving these cases as best and as fair as we can for our local community," Mrs Webster said.

"What concerns me is that if we are all merged into one council, Rodney ratepayers will end up having to pay for problems in metro Auckland, where the scale and size of the leaky home issue is so much larger and therefore will be much costlier to resolve."

Mr Williamson received a report on the size of the leaky building disaster some weeks ago but is refusing to release its findings.

A major investigation into the scale of the disaster was managed by consultants PricewaterhouseCoopers and experts met at that firm's Wellington office.

Mr Williamson plans to release a scheme for all new houses to have warranties to guard against weather-tightness issues.

Labour MP Phil Twyford has also raised fears the new Super City would abandon leaky-house victims and escape claims worth millions of dollars.

But Local Government Minister Rodney Hide has flatly rejected this and says the new council will take on all the old councils' liabilities as well as assets.

THE BIG WET

Active leaky building claims:
* Auckland: 1832
* North Shore: 455
* Rodney: 91
* Manakau: 123
* Waitakere: 348

Source: Department of Building and Housing, figures to August 2, 2009