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How did 24,000 tradies go unpaid?

The NSW Government has proceeded with a long awaited inquiry into failed building companies.
The NSW Government has proceeded with a long awaited inquiry into failed building companies. Rob Wright

AN INQUIRY is under way into the government contracts, which left 24,000 NSW tradies unpaid and saw hundreds of building companies such as Reed Constructions and St Hilliers enter administration.

Coffs Harbour's trade industries are still carrying the financial impact from three 'troubled' public housing complexs on Harbour Dr, West High Sts and Azalea Ave.

The initial government contractor Perle Pty went broke last year and left debts of $1.6-million to Coffs Coast sub-contractors.

That mishap was then followed closely by the financial problems of secondary contractor St Hilliers earlier this year.

Just one noted instance of many across NSW, the collapse of building companies over the past three years is the focus of the government inquiry, announced today by Finance Minister Greg Pearce.

Mr Pearce says the fragility of the construction industry is having a severe impact on workers and the economy and has left up to 24,000 unsecured creditors short changed.

"Between 2009 and 2011, hundreds of companies in NSW collapsed owing billions of dollars, slamming the brakes on vital projects and investment," Mr Pearce says.

"Up to 24,000 unsecured creditors, including suppliers and sub-contractors, have been left out-of-pocket, some by millions of dollars".

Mr Pearce says the inquiry will focus on construction industry insolvency and how to safeguard the interests of sub-contractors.

Member for Coffs Harbour Andrew Fraser welcomed the announcement.

"There are a number of sub-contractors in the Coffs Harbour area, who have been extremely financially hard hit over the past couple of years by the collapse of the companies Perle Pty Ltd, St Hilliers and Reed Constructions," Mr Fraser said.

"The Inquiry is a start into helping ensure sub contractors receive payment for the work they undertake.

"I would like to encourage all sub contractors who have suffered financial loss under the process that was established by the previous Labor Government to make a submission to the Inquiry.

"It is my belief the appointment of Tier One contractors from Sydney is costing the State Government money that should be going into the pockets of the sub contractors who are actually doing the work.

"If these contracts were to be handled by existing State Government Departments and agencies, such as the Department of Public Works, the Government will save money.

"There are numerous well established building companies in regional NSW who are quite capable of doing this work," Mr Fraser concluded.

The NSW Government is welcoming submissions on its 'Have Your Say' website - www.nsw.gov.au/haveyoursay

Alternatively, interested parties can email info@iicii.nsw.gov.au or write to the Chairman, Inquiry into Construction Industry Insolvency, GPO Box 15, Sydney NSW 2001.

 

Topics:  coffs harbour sub-contractors


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