CANBERRA’S bitter winter and even more bitter electricity costs are making everyone painfully aware of the need for greater energy efficiency in the home. It will be reinforced come the extremes of summer when the air-conditioner beckons.
Leave aside the great moral imperative of global warming, the higher cost of energy is doing its work.
It has been 14 years since the ACT, at the behest of the Greens, became the first Australian jurisdiction to introduce compulsory energy efficiency ratings before any dwelling (old or new) could be put on the market.
The cost, of course, was borne by the parties, ultimately buyers who were already carrying massive stamp duties and other costs.
The ratings had dubious justification in 1999, but by now are surely well past their use-by date. Only the most recalcitrant moron is unaware of the value of energy-efficient housing and the means to achieve it – face north, double glazing, good insulation, no leaks around doors and so on.
Why should property buyers be required to pay for a certified energy efficiency rater to give their prospective purchase the once over for the bleeding obvious?
The ratings cost as much as $350 and are an utter waste of money.
ACT Treasurer Andrew Barr is now a year into his plan to reduce stamp duty by replacing it with higher rates. His aim is to reduce transaction costs so that it is easier for people to move into smaller or larger dwellings or to different areas as their circumstances change.
It is a laudable aim that will help more efficient allocation of resources, as the economists say. Or as ordinary people say, why move to a bigger dwelling and pay the government $60,000 in stamp duty. Better to build an extension. Or better to put up with rattling round in a too-large dwelling than pay the Government $50,000 to downsize.
Barr could improve on his laudable aim by getting rid of the EER.
The EER does not in fact save any energy. To the contrary it expends it. All those certifiers driving to and from the 12,000 dwellings a year that are sold in the ACT. All that paper consuming all of those trees. Not to mention the polluting ink.
No-one is required to act on the reports. Indeed, real estate agents will tell you that very few dwellings are sold because of a good EER. Rather they are sold because of proximity to schools, grandma or shops, or because of the number of bedrooms or the gorgeous tiles in the bathroom.
The real driver for people to change to LED lighting and put more insulation in the roof and walls is the cost of electricity, not the say so of a man in a white coat handing out a compulsory EER report.
Now the sole Greens MLA has in effect joined the Government, the Greens have less sway to hold out on single-issues. Also the Liberals oppose EERs. So now is the time to act. Alas, in the ensuing 14 years a whole industry of energy efficiency certifiers has grown up, adding a great lump of profitable inefficiency in the property business.
They will whinge unmercilessly at the prospect, no doubt crying, “Jobs will be lost.” But let’s not listen. The jobs are non-jobs.
And while Barr is at it, he could do another thing to help property buyers – or in political parlance, struggling first-home buyers.
A quirk of the law has resulted in conveyancing lawyers advising buyers to take out insurance on the house as soon as they exchange contracts, not at final settlement. At common law the risk passes to the buyer on exchange and a seller could theoretically force a buyer to go ahead with the purchase, even if the house has burned down.
They also advise sellers to keep their insurance until final settlement just in case.
The advice is sound. The law is the ass.
The result is that insurance companies take an unjustified windfall of double insured houses.
About 12,000 houses are sold each year with about a month between exchange and settlement. Almost $1 million a year. Surely that money would be better in the hands of struggling home buyers than bloated insurance companies?
A simple law could say the seller carries the risk till settlement.
Over to you Mr Barr.
DOT DOT DOT
A few columns ago I mentioned Magna Carta. The 1215 pact between the Crown and the barons lives on as part of the common law, though much amended and changed.
In modern times it is more a pact between the Executive Government and the people. Essentially, it seeks to enhance justice and curb the use of arbitrary power.
Part of the pact is to provide a system of justice.
Article 40 says: “To none shall we sell, to no one shall we deny or delay right or justice.”
The report this week of the lamentable delays in the ACT Supreme Court suggests that the ACT Executive is failing in this pact.
If I sell you a car and you claim that it is defective and want your money back the state will not allow you to send around a few of your more disreputable mates to beat me up to extract the money. It makes you go to court.
So it is incumbent on the state to provide courts and judges to do the job.
Parts of the legal profession and Chief Justice Terence Higgins suggest that the appointment of another judge will solve the problem.
The government and other parts of the profession think not. The workload and case management in other jurisdictions, especially NSW, tends to support this stance.
Ultimately Magna Carta assigns the onus – the state has to provide an effective judicial system, after all it makes the judicial appointments.
The best way for the Government to prove its point will be to make a wise choice of the next chief justice – not only a good lawyer, but also a good manager who will make the whole court efficient and effective.
CRISPIN HULL
This article first appeared in The Canberra Times on 3 August 2013.