I was due to give this speech in parliament on 8 November 2022, but government members argued that many parts of it were not relevant to body corporate legislation. Here is my speech in its entirety.
I rise to speak on the Building Units and Group Titles and Other Legislation Amendment Bill.
It’s clear from the small number of speakers on this list that this bill is non-controversial. In making basically administrative changes to the Building Units and Group Titles Act 1980 and the Mixed Use Development Act 1993, this bill is one tiny step towards reform of body corporate law in Queensland, when what we need is urgent, meaningful change.
Our housing system is in a crisis, and body corporate schemes are not immune.
At least 415,000 Queensland households live in community titles schemes, and most of these are run by a body corporate. This includes people living in duplexes, residential unit blocks and high-rise accommodation complexes.
While, in many ways, our current laws allow for flexible arrangements where people can rent or own their home while sharing common property with other occupants, there are too many issues in body corporate schemes for the government to carry on with business as usual.
And let me be clear: this bill maintains business as usual.
Instead of business as usual, Queenslanders need urgent action on:
Building management statements.
Disaster planning.
Embedded networks.
Management rights and commissions paid to body corporate managers.
The accreditation, licensing and regulation of body corporate managers.
Bullying in body corporate schemes.
Dispute resolution, including proper funding for the Office of the Commissioner for Body Corporate and Community Management.
And Queenslanders need urgent action on the fact that bodies corporate have no control over residential buildings being used as inappropriate short-stay accommodation.
Business management statements
Building management statements, or ‘BMSs’, are an obscure feature of Queensland body corporate legislation which allow developers to retain control of body corporate schemes for up to 25 years, with no transparency to prospective buyers about such arrangements.
The government needs to step in to stop developers from using BMSs to take advantage of unit owners.
BMSs are being used to circumvent and undermine the integrity of Queensland’s body corporate and community titles regime. This serious policy failure is hurting everyday Queenslanders.
Developers of mixed-use - that is, residential and commercial, buildings are using BMSs as a legal tool to retain full control of those buildings long after the residential units have been sold. They may use this control to take advantage of residents by ripping them off, locking them into long-term management contracts and potentially evading insurance rules, fire safety rules and obligations to rectify defects.
My colleague, the member for Maiwar, and I have become all-too-aware of the impact that BMSs have on everyday Queenslanders, who have come forward to tell us about terrible situations in our electorates.
There are simple reforms the government could make in order to protect Queenslanders,
- Starting with requiring all sellers to disclose the existence of a BMS to prospective buyers.
- Further, it could require any new BMSs registered under the Land Titles Act 1994 to have specific and fair rules enacting democratic voting systems.
- Thirdly, the government could create a mechanism for lot owners to rectify or terminate unfair or oppressive BMSs by application to a competent tribunal.
- Fourthly, it could expand the remit of the Commissioner for Body Corporate and Community Management to cover matters under a BMS - noting that the Commissioner’s office would need to be adequately funded to perform its functions.
- And finally, professional registration, accreditation and licensing of strata managers is required.
This government needs to reform unfair and oppressive BMSs as a matter of urgency - Queenslanders’ quality of life, and their right to feel safe at home, is at stake.
Disaster planning
South Brisbane is home to hundreds of apartment blocks that flooded in February, and are at high risk of future floods. These apartments have been approved by the Brisbane City Council, under state government planning laws, which have resulted in people, their homes, and possessions, at extreme risk of future floods. Body Corporates, owners, residents and tenants are now having to deal with the outcomes of a broken planning system that has put the profit of developers over the safety and wellbeing of residents.
After the February 2022 floods, myself and hundreds of residents and volunteers spent days cleaning mud and water out of apartment basements, clearing flooded goods, and supporting residents across West End, Kangaroo Point and East Brisbane.
Many of these apartment blocks lost power for extended periods of time. In many cases, this was because electricity infrastructure, transformers and switchboards, for big apartment blocks is often in the basement. Many body corporates across South Brisbane are now on the hook for hundreds of thousands of dollars for fixing flooded systems, and now looking at options for raising electricity infrastructure. Many of these body corporates are also now doing amazing work preparing flood plans specific for their buildings.
Why is the electricity infrastructure in the basement? From what we understand, it would be the preference of Energex to have this kind of infrastructure not in the basement, but at ground level, where it is safely accessible, and dry. But developers don’t want this. Why waste space on a groundfloor level on electricity infrastructure, when you could shove it in the basement, as cheaply as possible, while freeing up space for retail or groundfloor spaces that could make a developer more money. And Brisbane City Council, under our incredibly weak state planning laws, have approved hundreds of developments of this kind. From what I understand, Energex has no statutory authority to direct new developments to put this kind of infrastructure in accessible, or flood-proof, areas. The result is that it is residents and body corporates picking up the costs for the failures and negligence of developers, the Brisbane City Council, and the state government.
We need:
- A ban on any new builds in flood-prone areas, in places like West End, Bulimba and elsewhere
- Planning to to ensure any new apartment blocks have electricity and other key infrastructure in places that are accessible and flood-proof
- Support for body corporates in existing flood prone apartment complexes, including expanding the Resilient Homes Fund to include body corporates to flood-proof essential infrastructure, such as electricity networks and lifts.
- Mandates to inform new buyers or tenants if an apartment or home has flooded.
Embedded networks
We also need urgent action on embedded networks. Victoria has just banned them, effective from next year. Queensland needs to urgently follow suit.
The bottom line is that these networks leave customers vulnerable to higher electricity prices, and in Queensland it’s often tenants and owner-occupiers who are paying higher tariffs because of these dodgy arrangements.
Choice reported in August that half a million Australians are locked into an embedded network for their power, with reduced consumer protections.
Basically an embedded network is where the management of a body corporate, retirement village or caravan park buys electricity in bulk from a provider and then on-sells this to occupants. Under this arrangement, the whole property is serviced by the electricity provider.
One of the very few choices that energy consumers have under our system is who their retailer is, and in an embedded network they do not have this choice.
In reality, this is about huge energy corporations like Origin having cosy arrangements with developers where they provide subsidised energy infrastructure, including bulk hot water equipment, in exchange for a long-term commitment, sometimes for 15 years or more, from the body corporate. Tariffs are often higher under these arrangements.
I first became aware of these arrangements because residents came to me concerned about the high electricity rates they were being charged, much higher than usual consumer rates, because an embedded network was in place. In some cases, there were indications that other benefits were being provided to body corporates: financial payments, not just subsidised infrastructure.
For an owner-occupier to be paying these high fees with no choice is unfair. For tenants to be paying higher energy fees to subsidise cosy arrangements between huge energy companies and developers should be criminal.
Short-stay accommodation
Another major issue facing body corporates across Queensland is the impact of short-stay accommodation. Platforms like Airbnb are allowing investors to pull houses out of the long-term market, to make huge amounts of money from visiting tourists. In the middle of a housing crisis, this should be banned.
But the impact on body corporates and other residents is also extreme - noise, issues around safety and security, and having to act as ad hoc building managers for visiting tourists who are lost, locked out, can’t use appliances or need other assistance. These buildings were never built to be hotels. The tenants and owner-occupiers who live there, never intended to live in a hotel. And yet we’ve heard dozens of stories from body corporates struggling to restrict Airbnb, or enact and enforce bylaws. While the BCC has recently moved to double rates for people putting homes on Airbnb, in many cases BCC has been slow to enforce their own planning rules, and the state government are doing nothing other than a research project.
The review of Queensland’s property laws has been going for almost a decade, under two different governments. We don’t need yet another consultation process to tell us that our body corporate laws need fixing. We need the government to take action, and make meaningful steps towards fixing the features of community titles legislation that are making life harder for Queenslanders.