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Figure 4.2
NZ estimates of the relationship between incremental loads
and incremental costs
Percentage change in cost
2.5
2.0
1.5
1.0
0.5
Earthquake loads & costs
Wind loads & costs
0.0
-0.5
-60 -40 -20 0 20 40 60 80 100
Percentage change in load
Source: Branz 2006: table 2
Overall, the evidence indicates that the cost increases are in the range 1-3%
of the cost of a construction project that involves structural work and needs to
be upgraded. The Queensland study comes in somewhat higher at 2-4 %,
while the NZ study is somewhat lower, at 1-2%, and the general engineering
calculation is intermediate, at 2-3%. A figure of 2.5% is adopted for the
purposes of this RIS.
4.2.3 Cost estimates
Table 4.5 presents the cost estimates obtained by implementing the model
that is outlined in table 4.1. Table 4.5 is organised as follows:
• The top panel reports ABS estimates of building work done on types of
buildings that are likely to be affected by the proposed measures. The
estimates have been transcribed from table 4.2. With the exception of
‘other non-residential buildings nec' (nec = not elsewhere classified),
the totals are the sum of both public and privately owned buildings;
• The middle panel of table 4.5 reports the workings of the cost
estimation model; and
• The final panel presents the results. The key finding is that, for the
average annual building task over the 5 years to 2006, the increase in
costs is $29.7 million/year. This is 0.5% of the broad categories of
building work that seem to fall within the scope of the measures.
The estimate of $29.7 million is an even smaller fraction of the total annual
building task: it is 0.05% of the $56.6 billion reported in table 4.2.
The remainder of this subsection comprises notes and explanations regarding
the middle panel of table 4.5.
ABCB Regulation Impact Statement (RIS 2007-03)
26