Changes are coming
New Zealand should have a new standard contract for the construction of building and civil engineering projects (NZS 3910:2023) by October this year.
The existing contract has undergone a major overhaul, and is now available for consultation, until the end of June.
The NZS 3910 is the contract most commonly used in New Zealand’s construction industry. Recent industry and government reports have pointed to significant issues with the contract’s use that may erode relationships between clients and contractors. Such relationships play a critical role in driving construction sector productivity as well as value-for-money in public sector infrastructure spending (around $10 billion each year).
“There’s been overwhelming consensus from the construction sector that the contract needed a comprehensive update,” says Tracey Ryan, co-chair of the Construction Sector Accord. “The proliferation of special conditions of contract that are often added to address shortcomings in the standard contract was a big focus. The fairness of some special conditions and the continual fiddling with the standard contract has caused big problems for the construction industry.”
In response, the New Zealand Infrastructure Commission, Te Waihanga and the Construction Sector Accord jointly commissioned a comprehensive revision of the contract with support from many within the sector. Standards New Zealand was appointed in late 2021 to lead and manage the revision process, which was done by a committee of representatives from across the construction sector.
This review of 3910 is the biggest revision the contract’s had since 1987.
“This revised contract aims to bring NZS 3910 in line with the current legislative environment and market conditions,” says Accord co-chair Andrew Crisp. “The goal is a balanced contract that is fair and reasonable for all parties. This is expected to reduce some need for parties to insert their own lengthy and complex special conditions and help ensure that the contract is fit for the industry in 2023 and beyond.”
The consultation document can be found on consultations.standards.govt.nz.