Show essential services shonks the exit door


With all the various horror stories of what goes wrong when an apartment catches fire, you would never want to skimp on safety.

But what if you were paying over the odds for safety inspections that were followed by upgrades that you didn’t really need but were  recommended by the same people who did the inspection? Oh, and the inspection was compulsory.

A year ago this column exposed the scandal of “embedded networks” – where an infrastructure supplier would do a deal with the developer of a new building to install their equipment for free, provided the developer agreed to dupe the purchasers of their apartments into signing up for an extended and inflated maintenance contract.

Is ”dupe” too strong?  Ask the strata managers who are pressured into selling the idea to naïve strata newbies.

Recently, we were told about another way of extracting money from apartment owners, that also may not always be entirely honest.

This potential scam comes under the general heading of “essential services”, which is big business, if the number of companies that have those two words in their title is anything to go by.

Basically, apartment blocks across Australia are legally obliged to have fire safety checks carried out on a regular basis.  And let’s face it, this is a good thing because a lot of blocks wouldn’t bother if they didn’t have to, and we can guess where that would lead.

However, as one Melbourne-based reader of the Flat Chat website has reported, this can get very murky when the “essential services” company performing the inspections is also the entity that fixes any faults that are found.

Now, to be fair, most essential services providers are honest and fair.

But then there are others, like the one cited by our Flatchatter, that charges $2000 for changing batteries worth $500 for the back-up fire pumps, a process that takes less than 15 minutes.

Is this a one-off? I’d love to be able to say yes but years ago I was told about a three-year-old building that had a state-of-the-art emergency water pumping system which had one fatal flaw – it wasn’t attached to any water supply.

What makes this even more remarkable was the at the system had been checked and tagged as fully functioning four times every year for three years – a total of 12 inspections – and no one had noticed there was no water in the pipes.

Essential services are for a building what dental check-ups are for people.  You might think everything is fine but if the dentists says you need three fillings and crown, who are you to argue?

So when the fire safety inspection company says you need to replace some emergency lighting, who on your strata committee is qualified to question the advice or even quibble about the cost.

Our Flatchatter has suggested that the company doing the inspection should never be the business that fixes the faults they discover. But how long would it be before the “frenemies” in the essential services business started scratching each other’s backs.

To be certain you are getting the best advice you need to find the good operators and the easiest way to do that is to get reliable opinions from other apartment owners who have managed to sort the honest wheat from the exploitative chaff.

Which is just another reason why we should support and join organisations like the Owners Corporation Network (OCN) in NSW. the Unit Owners Association of Queensland (UOAQ), and We Live Here in Victoria.

A version of this column first appeared in the Australian Financial Review.

3 Replies to “Show essential services shonks the exit door”

  1. keimoo45 says:

    Hi Jimmy
    I read your Financial Review article a few weeks ago and immediately recognised our ES providers! The agreement was negotiated with this company two years ago by the developer and its appointed OC manager. I am the Chair and sole rep of our 6-apt block. I am currently challenging the provider over their shoddy inspection process where the same issues are logged month after month without any feedback to our manager or us. The upshot is the Fire Inspection Panel batteries ran “out of date” 12 months ago and they have just presented us with their unsolicited quote for new batteries. I have tried to explain to our manager that they, as prime contractor, will suffer through lousy work by suppliers like this one.

    I’ll keep you posted on any success I have!

  2. nixjet says:

    I’m on the SC of a small older block in Sydney. We had been using the same company for our AFSS for years. They weren’t overly expensive but were reluctant to answer questions when we queried a few items of overservicing. We still got our AFSS every year with no major issues. However because of the lack of customer focus and unanswered questions we changed companies.
    The new company completed a full inspection and presented a report making sweeping recommendations and advising a number of critical breaches despite the records of the previous company stating otherwise.
    The quoted works were substantial.
    The new company wasn’t interested in the work of the previous company despite records of works being completed and simply told us that this was their interpretation of the regulations, that they were obliged to inform council of the breaches, here’s a quote and you have 30 days to complete otherwise you’ll be in breach.
    We were further advised we were free to contract their recommended works to other providers but we would still need to pay for a reinspection and their interpretation of the work required under the standards could be different to others. They then had the tenacity to say that they would give no guarantee that council would accept their work against the schedule held by council and that further works may be required depending on how the standards are interpreted.
    This just doesn’t seem right.
    I feel we are being blackmailed into compliance over a creative interpretation of a standard to force a retrofit of a fire safety system that might be nice to have but is certainly not a requirement , wasn’t required when the building was built, or when the strata was set up or in subsequent annual fire inspections . It’s only been since the new company took over that we have gone from several years of full compliance to serious-breach-city and a program of fire safety works which will require a special levy to pay for and months of work.
    The model where the certifier is essentially determining the interpretation of the standard, quoting for the work, excluding others from completing the work, then certifying their own work before handing over the precious AFSS is deeply floored. I have also found the strata management company to be quite willing to just accept whatever quotes come through without scrutinising what’s been done and not be concerned over how a building can go from years of compliance with no major problems to needing substantial retrofitting of compliant systems.
    We engage the services of professionals and experts to advise in areas where we have no experience. We need to be able to trust them.
    I would dearly like to recommend to the OC that we engage an independent 3rd party fire safety specialist to go through the work of our past company and that proposed by the new company and come up with a recommendation on what needs to be done to satisfy the minimum requirements. However I am worried about how much this would cost and the delay it would cause not to mention the threat to not obtaining our precious AFSS.
    Any thoughts or ideas?

  3. Jimmy-T says:

    This is now being discussed in the Flat Chat Forum

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