The National Construction Code (NCC) is one of Australia’s most important regulatory instruments. It provides the foundation for safety, amenity and sustainability across the built environment. Its role is indispensable, not just as a technical standard but as a cornerstone of public trust in the construction system.
That is why the federal government’s decision — the first action arising from last week’s Economic Reform Roundtable — to pause NCC changes until 2029 while fast-tracking approvals for 26,000 new homes deserves close attention. Builders have welcomed the pause as relief from red tape. The government also announced new work on prefabrication standards, reducing barriers for superannuation funds to invest in housing, and exploring AI tools to help tradies navigate the code’s 2,000 pages.
These are practical initiatives. But focusing on the NCC freeze risks obscuring the bigger truth: productivity in housing is not about one code or one lever. It is a system outcome, shaped by planning frameworks, infrastructure sequencing, carbon and energy reduction pathways, finance and capital, skills and innovation. Quick fixes may ease pressure today, but without system alignment, they create bigger costs tomorrow — for households, governments and investors.
The temptation of the quick fix
Housing is politically combustible. Governments want visible results before the next election. A code freeze is easy to message: “We’ve cut red tape for tradies.” Fast-tracking approvals looks equally attractive. But delaying code updates also defers the integration of new energy efficiency and carbon and energy reduction standards.
That creates a dangerous false economy. Supply may rise in the short run, but Australians inherit housing stock that is more expensive to run, less durable in extreme weather, and ultimately more costly to retrofit when carbon and energy requirements inevitably tighten. The forward liability will not just sit with builders — it will flow to homeowners through higher bills, investors through declining property values, and governments that will face pressure to fund large-scale retrofit programs.
The NCC is not the problem. On the contrary, it is a vital part of the solution. The risk lies in using the Code as a political pressure valve rather than embedding it in a long-term, system-wide reform agenda.
A standard under pressure
Part of the challenge is that the NCC is regularly criticised from two very different directions. Industry groups argue the Code is too complex, too lengthy, and too frequently updated — driving up compliance costs and creating “red tape” that slows down supply. By contrast, sustainability advocates argue the NCC has been too slow to mandate stronger energy efficiency, embodied carbon standards, or sustainable building innovations. The result is a standard that is both accused of changing too often and of not moving fast enough.
Neither criticism is misplaced. For smaller builders, navigating a 2,000-page document and keeping pace with frequent updates can be costly. For households and investors, however, delays in carbon and energy standards lock in higher future liabilities. It also limits more sustainable choices for home buyers. The real challenge for policymakers is to balance these pressures — ensuring the NCC continues to provide certainty and safety for industry while also driving the innovation and resilience Australia needs.
The trade-offs we face
At its core, housing reform is about balancing competing objectives:
- Time vs quality — faster approvals risk weaker oversight.
- Cost vs lifecycle value — cheaper builds today mean higher bills tomorrow.
- Quantity vs safety — more supply can come at the expense of long-term reliability.
- Supply vs sustainability — pausing carbon and energy reduction standards locks in future emissions and costs.
Trade-off theory helps us see why there is no silver bullet. But the real challenge is not simply choosing between objectives — it is sequencing reforms so they reinforce one another rather than clash.
What really drives productivity
If housing productivity is the goal, five priorities are non-negotiable. First, fix planning blockages, the largest supply bottleneck. Second, embed carbon and energy reduction pathways, with embodied and operational requirements phased in to avoid future liabilities. Third, shift from the cheapest build to the total cost of ownership. We have been doing this in the energy sector for a long time, recognising that upfront investment in efficiency (or technology) pays dividends over the long run. Fourth, accelerate innovation — prefabrication, modular methods and low-carbon materials need fast-tracked standards and approval pathways. Fifth, protect safety and resilience — speed cannot come at the expense of resilient housing.
Resilience means more than just structural safety. It is the ability of homes to withstand and recover from shocks — physical, financial and environmental. That means dwellings that remain safe in floods, fires and heatwaves; homes that keep energy bills manageable during price spikes; and buildings that can be adapted to new carbon and energy requirements without crippling retrofit costs. In short, resilient housing is durable, affordable to run, and adaptable to change.
The federal government’s decision to develop prefabrication standards is a step in the right direction. As I argued in my recent submission to the Department of Finance’s consultation on modern manufacturing processes, innovation and sustainability can be achieved together, and often deliver cost savings rather than cost burdens. But unless these pathways are aligned with planning reform and investment certainty, their potential will remain untapped.
The investment question
With nearly $4 trillion in assets under management, Australia’s superannuation sector could be a powerful partner in expanding supply. The government has pledged to reduce barriers to super fund investment in housing. That matters: institutional capital has largely stayed on the sidelines in Australia. Planning delays, shifting regulations, and uncertainty around future carbon and energy reduction standards make projects riskier and returns less predictable. As a result, many super funds invest in housing offshore, where frameworks are clearer and long-term returns are more reliable.
Politics and policy readiness
The bias towards “quick wins” is not accidental. Housing sits at the intersection of electoral pressure, fiscal constraint and bureaucratic fragmentation. It is easier to freeze a code or promise AI for tradies than to harmonise state planning systems or phase in carbon and energy standards.
Not every lever can be pulled at once. Approvals reform is administratively ready and politically attractive. Carbon and energy reduction pathways are technically feasible but politically sensitive. Superannuation flows into housing are possible but need supportive structures. Prefab and modular innovation require regulatory facilitation and financial backing. The key is sequencing: fix planning and approvals, then phase in carbon and energy standards, while de-risking investment and opening pathways for innovation.
From false simplicity to smart simplicity
The NCC freeze and associated announcements reveal both the promise and peril of “quick fixes.” They provide the appearance of progress, but risk compounding the problem if treated in isolation.
What Australia needs instead is smart simplicity: reforms that are clear and communicable, but integrated across the system.
- Fast-track approvals, yes — but only if paired with carbon and energy reduction pathways. Otherwise, today’s supply increase becomes tomorrow’s retrofit burden.
- Freeze code churn, yes — but not without a roadmap for innovation and sustainability. Otherwise, industry won’t invest in modern methods if the regulatory horizon is uncertain.
- Develop prefab standards, yes — but only if planning reform and financing channels are aligned. Otherwise, prefab remains a niche solution without scale or affordability impact.
- Invite superannuation capital, yes — but only if risk is reduced through regulatory certainty. Otherwise, funds will continue to favour offshore infrastructure instead of Australian housing.
The point is simple: there is no benefit in pulling one lever if the others that must move with it are left untouched. Housing productivity depends on sequencing reforms so they reinforce each other rather than undermine each other.
Freezing the NCC may look like patching that leaky roof. It seems neat and quick, but it will not hold for long. The real test is whether governments can strengthen the foundations: planning reform, carbon and energy reduction pathways, innovation, financing and resilience. Only by doing the harder work beneath the surface can we deliver not just more homes, but better homes — built to last for decades to come.
