No help from LNP for subcontractors
THE State Government says the collapse of Walton Constructions is not enough cause for another inquiry into subcontractor payment protections.
However, it was reviewing the Building and Construction Industry Payments Act with a report due by year's end.
A spokesman for Housing and Public Works Minister, Tim Mander, said clauses requiring contractors to attest to payments to subcontractors were not mandatory for work commissioned by the government because of the potential for them to add an administrative burden on the contractor.
"The government may choose to insert such clauses on a case-by-case basis depending on a range of factors including the size, value and complexity of the contract,'' he said.
Sunshine Coast subcontractors who worked on the Nambour Coles project lost hundreds of thousands of dollars when contractor Walton Construction was placed into administration two weeks ago.
The collapse has sparked calls for greater protection for subcontractors.
Mr Mander's spokesman said unlike most industries, business owners in the construction industry had the option to pursue payment through the Building and Construction Industry Payments Act, which allowed disputes to be resolved through adjudication rather than the courts.
"One of the challenges of running any kind of business is how to respond when debtors fail to pay,'' he said.
The Master Builders Association has rejected calls for trust accounts to manage payments on a job-by-job basis.
Director of construction, John Crittall, said the approach would only stifle cash flow and create more problems.
He said the industry was at the lowest period of commercial construction in a generation and in the hardest four years of the current cycle.
"Margins are being cut to the bone,'' Mr Crittall said.
"People are desperate and signing outrageous contract conditions that are being passed down the contractual chain."
He said the collapse of the building company had created a terrible impost on the industry with a ripple effect.