Opinion to HIA based on estimates, assumptions and unverified data

The SafetyAtWorkBlog inbox this afternoon received a document entitled “The Work Health Safety Bill – Review and Economic Impact Estimates” by consulting firm, Hudson Howells.  SafetyAtWorkBlog has been advised that this report was recently prepared at short notice on behalf of the Housing Industry Association (HIA).  It may be one of the documents seen by at least one South Australian Parliamentarian in the  recent debate on OHS harmonisation, as reported in a blog article earlier today.

The document provides some background to the HIA’s claims that the costs of domestic housing may increase by around $A20,000 per dwelling due to the introduction of harmonised workplace health and safety laws in South Australia.

The report states that

“The costs associated with implementing the WHS Bill as an additional $20,690 per single storey dwelling and $29,335 per double storey dwellings (based on estimates provided by HIA SA). Quantity Surveyor, Rider Levett Bucknall, has confirmed these estimates in a report to the HIA with their own estimates being $20,088 and $28,450 respectively”.

These figures are based, according to the report, on an August 2009  evaluation by Hudson Howells of

“the economic cost impacts of incorporating the National OH&S Construction Standard (NOHSC Standard) into the Occupational Health, Safety and Welfare Regulations 1995 (SA).”

It must be noted that the figures above are “based on estimates provided by HIA SA”  and resemble the figures that Independent MP Ann Bressington has described in Parliament as

“..not an accurate reflection of the real costs..”

The amount of information that HIA, the client, has provided to Hudson Howells seems extraordinary.  The equivocating and conditional language in Hudson Howells’ report is highlighted below:

“The findings in this report are estimates only based on a range of assumptions and estimated costs supplied by the Housing Industry Association which have not been verified by Hudson Howells.

Information supplied by Bradbrook Lawyers and EMA Legal – The Work Health and Safety Bill – Changes to occupational Health and Safety Laws – have also been used to assess the potential economic impacts of the Bill.

It is stressed that this report is a preliminary assessment identifying the impact of the WHS Bill on key economic factors and that no primary consultation has been undertaken. Additionally, no detailed economic modelling has been undertaken. The findings are therefore preliminary estimates based on a range of assumptions, estimated costs provided by the Housing Industry Association (HIA) as independently verified by quantity surveyor firm Rider Levett Bucknall, and publicly available data.” (links added)

This document provides opinions based on extremely limited data, much of which seems to have been provided by the client.

The Housing Industry Association’s claims of cost increases on domestic housing have appeared frequently in the South Australian media since at least August 2008 and have been taken by some politicians as part of the need to delay the implementation of harmonised workplace health and safety laws.

The information provided in the Hudson Howell report casts further doubt on the veracity of the HIA’s cost claims.  Hudson Howell’s opinion may be valid but it is based on a large number of assumptions and unverified estimates, and seems to have been prepared under a tight timeline, according to other comments in the report.

Occupational safety and health legislation and policy deserves to be formulated on sound evidence, not marketing surveys or opinions based on information provided by the client.

The HIA is doing no one any favours by refusing to release the data on which it makes its harmonisation cost claim.  But if the original data emerges from a report similar to what the HIA sought from Hudson Howells, the avoidance of releasing the document is understandable because otherwise the HIA’s embarrassment would be unbearable.

Kevin Jones

reservoir, victoria, australia
Categories business, economics, evidence, government, law, lawyers, OHS, politics, safetyTags , , ,

11 thoughts on “Opinion to HIA based on estimates, assumptions and unverified data”

  1. Andrea, you are right. I have received similar comments from other readers and apologise for attributing some Hansard quotes to the wrong speaker. The article above has been corrected.

  2. It will be interesting to read the Hansard on oomments and how the votes actually went in the legislative council.

    I was informed Ann Bressington voted against the bill and also voted to defer.

    Based on what I am reading here, that doesn’t really add up either given her objections to the validity of the HIA report’s estimates.

    Why would she support the Libs in blocking the Bill if she believed the numbers were misleading the housing cost increases?

  3. Great work Kevin I think you are however a little too polite in your treatment of the bottom line impact of this. Unless the HIA have any more information up their sleeve my own opinion is that the HIA document is about as valid as the Federal Oppositions so called “audit” of its election costings – which treasury said had an $11 billion hole.

    The Age today reported that the accountants who had costed the Oppositions policies had breached professional standards because they relied on figures and assumptions provided by the Opposition without questioning them – see:

    http://www.theage.com.au/national/lib-policy-costings-exposed-by-ruling-20111130-1o773.html

    Here the consultant did clearly and heavily qualify the HIA report – and that is obviously why it has not been publicly released.

  4. HIA members in SA must have their staff still working in thongs and a singlet for it to cost an extra $20K to build a house! Get real HIA, put forward a reasonable argument and people may take you seriously.

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