Christchurch Earthquake 2011
Changes to the Earthquake Commission's payment process are behind a drop in claimants opting out of its repair programme, contractors say.*
The number of people choosing to handle their earthquake repairs themselves has dipped to about 70 per week in the past month, after being well over 100 per week through August and the first half of September.
The commission (EQC) in July changed the payment process for customers who opted out of its Fletcher-managed quake repairs scheme (EQR), handing responsibility to the homeowner.
It previously paid contractors directly.
Russell Poole, a co-owner of the Fix It building repair franchise, was "not surprised at all" by the drop.
"There is only one outcome of the new payment terms and that is a shrinking of the opt-out market and people being forced back into the EQR scheme.
"It now takes [EQC] a lot longer to process than it used to. It used to take three-odd weeks; it's now taking them up to eight weeks from the time we send in our quote to the time we get a decision."
Poole complained to the Commerce Commission that EQC's payment changes were anti-competitive, but was told by the watchdog last week no action would be taken.
Nick James, of Christchurch repairs firm Rebuild Me, said it was odd the numbers would "spike like that and then drop right off"'.
Rebuild Me launched in August and was taking 30 to 40 clients per week in late August and early September, James said, which might have helped the spike. However, the company had deliberately stepped away from its earlier marketing drive.
"We have definitely decreased our own advertising and chasing of clients [since August] because we're trying to deal with a whole lot of issues with EQC," James said. "Mainly [it's] around the rates and the time frames. It makes us look bad to the clients when it's not us holding the jobs up."
The company would not ask customers for up-front payments to get around cashflow problems, he said.
Fletcher EQR spokesman Barry Akers said he could not comment on how EQC's payment changes had affected business.
"When people are in the repair programme we do the best we can for them under the rules set by EQC. The decision whether people opt out or not is between them and EQC, really. We do the repairs we're given to do."
An EQC spokesman said it had changed the payment system to "streamline the process . . . [and remove] ourselves from the position of having to be the quality controller, which ultimately makes us the project manager."
* Update: Figures provided by the commission indicate the number of opt-outs rose for six weeks immediately after the policy change in July, and although they dropped after mid-September, the average in the weeks since then remains higher than in the 21 weeks before the policy change.
- © Fairfax NZ News
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