The Westminster system of parliamentary governance rests on a principle so fundamental that constitutional scholars have argued civilised government is impossible without it: the separation of powers. The executive governs, the legislature makes laws, and the judiciary interprets them. No single hand holds all three. It’s a valuable lesson learned over centuries. We see what happens when unchecked power and financial self-interest are in the same office.
Strata remediation in 2026 operates on the opposite principle. One consultant diagnoses the problem, writes the scope of works, runs the tender, and project-manages the rectification. A single entity handles each step of a process that might cost owners hundreds of thousands or even millions of dollars. Their fee is a percentage of the total contract amount.
Constitutional framers called this arrangement tyranny. In strata, we call it full-service.
What does the standard remediation model look like?
The standard model works like this. A strata manager receives a water penetration complaint, gets a referral, and engages a remedial consultant for a condition report at somewhere between five and seven thousand dollars. The report is a loss leader. Its primary function is not to diagnose the problem, it is to position the consultant for the next engagement, writing the scope of works. The consultant then project-manages the rectification at a fee of ten to eleven per cent of the total contract sum.
Ross Taylor of Ross Taylor Associates, one of Australia's most experienced remedial building consultants, is direct about the consequences. In his assessment, the business model in common use, whereby the consultant writes the condition report, writes the scope of works, and project-manages the rectification, is designed to minimise accountability and maximise profit. It regularly leads to repair works costing ten times more than necessary. And it regularly does not solve the original problem.
Read: We’re in a building defects crisis – so how should strata purchasers practice due diligence?
Can three small leaks really cost $2.5 million?
Taylor told the story of an older blond brick building with three small leaks at last year’s Strata Impact conference. A typical multi-storey residential building, three units with water penetration in a corner, a familiar problem. The suggested scope included demolition of balustrades, removal of sliding glass doors, a new membrane over the entire floor, and new tiling throughout. The bill was $2.5 million.
The consultant justified this scope in their report, stating that fixing only one cause might not solve the problem and could even make other fixes less effective. No material testing. No water testing. No deconstruction. A visual inspection and a professional opinion about what the source of the water ingress might be.
That is not a diagnosis. It is an insurance policy, written at the owners' expense. The scope addressed every possible cause simultaneously so that the consultant's professional indemnity position was protected, regardless of whether any individual cause was present.
Read: Building Better: How NSW is Tackling the Apartment Defects Crisis
Why does the conflict of interest produce such predictable over-specification?
Two incentive structures push simultaneously in the same direction. The first is the fee model: a consultant who recommends targeted repair earns a fraction of the project management fee that a full strip-out generates. The second is professional indemnity: if a targeted repair is recommended and the defect recurs, the consultant faces a liability claim. If a comprehensive scope is over-specified and some of it was unnecessary, there is no equivalent consequence.
The separation of powers principle exists precisely to prevent this alignment of diagnosis and financial interest. A Westminster parliament does not allow the executive to judge the lawfulness of its own decisions because the conflict is so obvious as to make the outcome predictable. Yet in strata remediation we permit the party whose income depends on the size of the scope to determine the scope.
The answer is structural separation. The diagnostic role, identifying what is wrong and designing a scope of works based on evidence, should go to an independent forensic consultant whose engagement ends before the tender. A different party project-manages the rectification. The two roles do not overlap. This is not radical governance theory. It is the same principle your own government has operated on for hundreds of years.
Read: Banking Fixed Its Conflict-of-Interest Problem. Why Is Strata Still Defending It?
What does good process require?
Ross Taylor calls the alternative the Scientific Remedial Method. Define the problem precisely. Collect all available data. Develop a testable hypothesis. Test it with water testing, electronic leak detection, and laboratory analysis. Map the actual leak flow path. Design the solution and build a prototype before full commitment. Write the scope of works only after the evidence is in and have it independently peer reviewed.
The result, in Taylor's experience: jobs that go through proper analysis and testing cost approximately one tenth of the price of jobs that do not. Not a marginal improvement. The difference between a $250,000 repair and a $2.5 million special levy.
Strata committees are not equipped to challenge a remediation scope on technical grounds. They were not appointed for that. But they are entitled to ask which of those seven steps were completed before the scope was written, and they are entitled to expect their strata manager to ask on their behalf before a dollar is committed.
Separate the powers. It works in Westminster. It will work in strata.
Michael Teys has more than 30 years’ experience as a strata lawyer and academic and has owned 11 strata management agencies throughout Australia. He has a Master of Philosophy (Built Environment) and Bachelor of Laws. He lectures and writes widely about strata management issues in Australia and internationally.
