$4 Billion Lost to Consent Delays: Minister Slams Hidden Costs in Broken Building System

The newly published data shows that two-thirds of all consent applications in 2024 were subject to at least one RFI, resulting in an average delay of nearly 12 additional working days per application.

The true cost of delays in New Zealand’s building consent system has been laid bare in newly released annual data, prompting the Government to fast-track sweeping reforms to streamline the process and support the country’s trades sector.

Building and Construction Minister Chris Penk has announced that consistent national data collected for the first time in 2024 has exposed systemic inefficiencies in the building consent process—inefficiencies that are costing the construction industry time and money.

The data, gathered from Building Consent Authorities (BCAs) across the country following a ministerial directive last year, shows that while most consents appear to meet the statutory 20-working-day processing limit, this figure is misleading. Councils have been routinely "stopping the clock" on applications by issuing Requests for Information (RFIs), effectively pausing the countdown while they wait for further details from applicants.

The newly published data shows that two-thirds of all consent applications in 2024 were subject to at least one RFI, resulting in an average delay of nearly 12 additional working days per application.

“With more than 94,000 applications triggering RFIs last year, we’re looking at hundreds of thousands of lost working days across the sector,” said Minister Penk. “Officials estimate that each 12-day delay could add around $4,000 to the cost of a single dwelling. Multiplied across the entire industry, we’re talking about hundreds of millions of dollars in hidden costs.”

The delays are impacting not just developers and construction companies, but also thousands of small businesses, tradespeople, and families awaiting the completion of new homes and renovations. For many in the industry, these hidden hold-ups are a source of mounting frustration, compounded by rising material and labour costs.

“This is about more than just numbers. Every unnecessary delay means real financial stress for builders and families, and longer waits for homes to be completed. Our building consent system is not fit for purpose, and we’re committed to changing that,” Penk said.

Sweeping Reforms on the Horizon

In response to the findings, the Government is pushing ahead with what Penk describes as the most significant overhaul of the building consent system in a generation. A comprehensive reform package is expected to be finalised in the coming months, and will include:

• Streamlined Inspection Processes: The Government aims to reduce redundant and overlapping inspections by improving coordination and focusing regulatory oversight on areas of greatest risk.

• Self-Certification for Trusted Builders: Qualified and reputable builders may soon be allowed to self-certify parts of their work, easing pressure on local councils and accelerating project timelines.

• Restructuring of BCAs: Plans are underway to restructure and potentially consolidate the current network of local Building Consent Authorities to improve consistency, efficiency, and accountability.

• Rebalanced Liability Settings: The current liability framework places a heavy burden on councils, leading to overly cautious processing practices. A more balanced approach to responsibility for defective work is being considered, which could reduce bureaucratic bottlenecks.

Industry Welcomes Move, Calls for Urgency

The construction industry has welcomed the release of the data, with many saying it confirms what they have long suspected.

“This just validates what builders have been saying for years—that the 20-day target is being gamed and the actual wait time is much longer,” said one Auckland-based building contractor. “We’re glad to see the Government taking this seriously, but we also need action quickly. Every day lost is a financial hit.”

Industry groups are calling for better training and support for council staff processing consents, clearer guidelines to reduce unnecessary RFIs, and more robust digital tools to improve communication between applicants and councils.

A Turning Point for the Sector

Minister Penk said the reforms are a central part of the Government’s broader agenda to improve housing supply, reduce construction costs, and support economic growth.

“We want a consent system that supports growth, encourages innovation, and most importantly, works for the people on the ground—our builders, tradies, and homeowners. The current system is slowing us down. That’s no longer acceptable,” Penk said.

The final reform decisions are expected to be unveiled mid-year, with legislative changes likely to follow shortly after.

In the meantime, the Government has committed to continuing the publication of quarterly consent data to maintain transparency and pressure for progress.

“We now have the data. We know where the problems lie. And we’re moving swiftly to fix them,” Penk concluded.