Hon Simon O'Brien MLC

Hon Simon O'Brien MLC

Former Minister for Finance; Commerce; Small Business

    Government moves to protect subcontractors

    17/10/2012 12:00 AM
    • Investigator to be appointed
    • Statutory declarations to be tightened
    Finance Minister Simon O’Brien today announced a number of positive initiatives to protect subcontractors working on building projects run by Building Management and Works (BMW).

    “While the State Government does not have direct contractual relations with subcontractors, I believe it is important that it leads the way in protecting them from missing out on payments by head contractors, particularly in the case of contractor bankruptcy,” Mr O’Brien said.

    “The Government has already put in place stronger pre-qualification requirements for builders wanting to work on Government projects.  However, I believe more should be done.

    “The issue is balancing the need to protect subcontractors with the competing needs to reduce red tape and provide value for money for taxpayers.  Achieving this balance will require consultation with industry.”

    The initiatives announced today are:
    • more detail on statutory declarations provided by contractors verifying subcontractors have been paid. The detail will include whether there is a current dispute and the value of that dispute
    • the option to hold back monies from contractors if there is a dispute between contractors and subcontractors over payment or issues such as quality of work
    • an education campaign to make subcontractors aware of their rights
    • a requirement for contractors to inform BMW of the names and contact details of subcontractors working on a particular job.
    “In addition, I have charged the Small Business commissioner, David Eaton, with the task of appointing an independent investigator to investigate the claims of subcontractors who have lost money on BMW Building the Education Revolution (BER) projects,” the Minister said.

    “It should be noted, however, that since I went on the radio calling for subcontractors who felt they have lost money on BMW BER projects to contact my office, only two companies have taken up the offer.”

          Fact File
    • In 2011-12, 2,229 building companies went into administration
    • 22% of all companies going broke are construction companies
    • Since 2009, five contractors on BMW BER projects have gone bankrupt
    Minister's office - 6552 5800