Building products certifier CertMark allowed to carry on despite failing reviews
Newly released documents show the country's leading building products certifier failed reviews repeatedly for years but officials let it carry on largely unfettered.
CertMark, of Queensland, went on to issue twice as many New Zealand CodeMarks as any other certifier, many of them during the periods it was under investigation.
Government officials say in internal briefings that certifications have been issued that should not have been, and that "poor certificates have the potential to compromise the safety and durability of buildings".
The Ministry of Business, Innovation and Employment's (MBIE) own files show it regularly expressed alarm at the quality of CertMark's work since 2014, but at the same time was advising the public and local councils the company's work could be relied on.
CertMark abruptly pulled out of the scheme in New Zealand in July, leaving in the lurch scores of companies that collectively paid millions of dollars for certificates, but now are being told by the ministry to find a new certifier.
This is revealed in emails, documents and inquiries into the CodeMark scheme that RNZ has obtained through the Official Information Act and other means.
The scheme is touted as providing gold-standard certification that cannot be challenged by councils during building consenting.
Private companies that certify products are only meant to be allowed into and remain in CodeMark if they pass rigorous checks.
Last year the MBIE finally suspended a half-dozen of CertMark's safety-critical certificates that applied to aluminium composite panels amid fierce scrutiny of the panels worldwide following the fatal 2017 Grenfell Tower fire in London.
This disrupted the building industry, including costing the SkyCity International Convention Centre in Auckland $25m to replace its panels.
There was no requirement to tell the industry about its concerns up till those suspensions, the ministry told RNZ.
The ministry has repeatedly told the public that having fully reliable building product assurance programmes is a top priority of the government's largest overhaul of building regulations in 15 years.
RNZ inquiries also show a catalogue of complaints and accusations against CertMark from half a dozen companies in Australia and New Zealand, since 2011.
2005 - CodeMark product certification scheme begins
2011 - CertMark is accredited to issue CodeMarks in New Zealand and Australia. Companies begin to complain to regulators about CertMark.
2013 - "CertMark had issued ... certificates outside both their geographic and technical scope ... CertMark has withdrawn ... certificates issued within China" - The ministry's CodeMark administrator, the independent Joint Accreditation System of Australia and New Zealand (JAS-ANZ).
CertMark issues 16 certifications in New Zealand in 2013
2014 - "These two certificates ... suggest significant issues with the quality of CertMark's process" - internal ministry document, ordering a full review
12 certifications issued by CertMark in NZ
2015 - "Serious shortcomings", "evident errors in CodeMark certificates", "obvious disparity between [CertMark] certificates and other(s)" - internal JAS-ANZ review findings
15 certifications issued by CertMark in NZ
2016 - Extra surveillance imposed on CertMark for one year
2 certifications issued by CertMark in NZ
2017 - "In 2017 the forensic audit ... in 2018 other technical reviews ... established that some [CertMark] certificates should not have been issued" - JAS-ANZ statement to RNZ
10 certifications issued by CertMark in NZ
2018 - "MBIE has serious and ongoing concerns about the ability of CertMark to make robust and technically correct certification decisions" - internal ministry document
10 certifications issued by CertMark in NZ
June 2019 - "There are certificates with significant technical errors demonstrating a lack of understanding of the Building Code" - internal ministry document referring to CertMark and a revoked certifier, Beal
October 2019 - "The withdrawal of CertMark [from New Zealand CodeMark in July] is an example of the scheme functioning as it is intended" - ministry statement to RNZ
Zero certifications issued by CertMark in NZ in 2019
Between May 2014, when the ministry raised the alarm, and July 2018, when the ministry exercised its suspension powers for the first time ever, CertMark issued about 40 certifications - far more than any other certifier - out of its total of about 70 New Zealand CodeMarks issued from 2011-2019, covering large volumes of products.
The ministry did not disclose these reviews or concerns to the industry or public "as no product certificates were suspended or revoked" before mid-2018, the ministry told RNZ in a statement.
It did not tell its partner in CodeMark, the Australian Building Codes Board, about the 2014-15 review because this was "under the New Zealand scheme", it said.
The ministry challenged the findings of its own 2017-18 audits of CertMark.
It accused the independent auditor it appointed of exceeding his brief, but a review upheld his findings. This delayed the suspension of the aluminium composite panel certificates for eight months.
A scathing independent review of the whole CodeMark scheme was done in 2017, but the ministry withheld it for a year until RNZ forced its release in mid-2018.
CodeMark is run by the ministry's Building System Performance unit, which was its worst-performing unit for the five years after the Christchurch earthquake. Its restructure in 2017 was hampered by staff shortages.
This unit is currently entrusted with the government's largest overhaul of building regulations since 2004.
Building products that have CodeMark may be fine - what is at question is the proof that they safe and durable, the controls around installing them safely, and the fact that CodeMark is trusted with being robust enough to override other routine checks.
The documents released to RNZ show CertMark was at its busiest, issuing 24 certifications for New Zealand products, during the very time it was being investigated in 2014-15. This inquiry found the "serious shortcomings" and "failures" that had caused unspecified problems for clients, JAS-ANZ said.
Just a year before, in 2013, JAS-ANZ had told a complainant that CertMark was "competent".
A full review later found 23 faults and "systemic issues" with CertMark's certificates, including leaving out key performance clauses, claiming compliance with irrelevant clauses, and being out of date. Three other certifiers were reviewed and had between one and four faults in their certificates.
But by late 2015 the Australian company had been placed under extra surveillance for 12 months.
CertMark's lawyer sent a long letter to the ministry in December 2015 complaining that ministry actions were damaging its business.
But its rate of certifications picked up again in 2017 and 2018. This was despite the forensic audit and technical reviews that eventually, two years on, led to CertMark itself being suspended in mid-2019.
In 2016, a fire engineer, who was also an auditor for the ministry, had warned officials that CodeMark certificates had untested fire performance clauses that created a "significant credibility deficit".
The industry viewed them as "not worth the paper they're written on", the engineer Dr Tony Enright said.
This was shortly after the Lacrosse apartments fire in Melbourne in 2014, and a year before the fatal Grenfell Tower fire in London; both high-rises were clad in a highly combustible type of aluminium composite panel.
Amid the extra scrutiny worldwide after Grenfell, CertMark's certificates for less-combustible types of aluminium composite panels were eventually suspended, revoked or withdrawn on both sides of the Tasman for failing to back up fire resistance claims, errors and lack of technical understanding.
It was the first time the ministry had ever used these powers.
The ministry's manager of CodeMark for most of this period, John Gardiner, told RNZ he had little recollection of his dealings with CertMark because it was a "turbulent" time.
Attention was "probably" being paid to CertMark after the 2015 inquiry but he could not recall "whether the quality of them improved, declined or stayed the same", or recall if he had seen the full review of the certifications, Gardiner, who now works as a private building consultant in New Zealand and Australia, said.
Asked if he was responsible for allowing poor certification to take place for years, Gardiner at first said yes, then no: "Are you putting it on to me personally? I was the manager of the New Zealand part of the scheme, [so] yes ... ah … no," he said.
CertMark was suspended by CodeMark Australia in July 2019 and reinstated by JAS-ANZ this month. RNZ has asked JAS-ANZ to clarify its [https://www.jas-anz.org/accredited-bodies/filter online statement about why it lifted the suspension
CertMark still offers other types of building appraisal in New Zealand, and has expressed the intention to return to issuing CodeMark here too. It has just appointed a national compliance director for New Zealand and Australia.
CertMark has not responded to RNZ's approaches for comment.
In June, internal files show the ministry said of CertMark's work, and that of a second certifier, Beal of Wellington, that "certificates are being issued where they should not be".
But it has told RNZ it was now satisfied the majority of CertMark's 63 CodeMarks "are correct" and only a few needed more checking.
Documents show it has told CertMark clients who must get an annual audit that their CodeMark will lapse unless they engage a new certifier, who effectively must start over with assessing their building products.
There are only four certifiers left after CertMark's withdrawal, Beal being revoked for failures and state-owned AsureQuality halting any new certifications.
The ministry's public statement, that CertMark's withdrawal showed the scheme was functioning as intended, contrasts with its closed-door briefing in June.
This listed 10 major CodeMark failings including having "no monitoring and reporting arrangements" with certifiers, it taking "an excessive amount of time" to fix problems and certifiers lacking capacity and capability.
The ministry's public statement also said it had seen "no evidence to suggest there are any issues with CodeMark products installed in homes and buildings ... Issues with the technical detail of the certificate in no way indicate that the product is not performing as it is expected to for its intended use".
But in August 2018, the ministry urged JAS-ANZ to speed up sanctions against CertMark and Beal, saying: "Issues with the performance and capability of a [certifier] and its product certificates can result in potential issues with a product's compliance with the New Zealand Building Code and the compliance of the building work in which the product is being used. This is a serious matter ... to be addressed at the earliest opportunity."
A Cabinet paper shows the government wants the ministry to get stronger investigative powers but there is scepticism in the industry that this would work given the ministry's track record.
This article was originally published on RNZ and re-published with permission.
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