Palaszczuk Government to introduce landmark Building Industry Fairness legislation

The Palaszczuk Government will today (22 August) introduce legislation to the Queensland Parliament ushering in a new age of fairness in the building and construction industry.

Minister for Housing and Public Works Mick de Brenni MP said the Building Industry Fairness (Security of Payment) Bill 2017 will establish a regime to help ensure small and medium construction businesses are paid in full, on time and every time.

“For too long the building and construction industry has operated by pushing the majority of the risk for projects onto subcontractors—often family run businesses,” Mr de Brenni said.

“That changes with these new laws. We are putting the construction industry on the level.”

Mr de Brenni said that the Government’s comprehensive suite of reforms would simplify the payment system, take action against illegal phoenixing and introduce project bank accounts to help ensure money owed to subbies was available to them.

It would also reverse changes under the previous LNP Government that removed mandatory financial reporting for building companies.

“The LNP’s absurd changes to financial self-reporting opened the door to abhorrent practices in the industry. Their changes to the payment system kicked that door off its hinges entirely.

“We are expanding the financial investigation powers of the QBCC, allowing the regulator to intervene more strongly to protect subbies.

“This reverses disastrous changes introduced by the LNP that effectively tied the QBCC’s hands behind its back.  

“Our new laws will bring back financial standards to the industry. It will give the building regulator the QBCC a line of sight to companies that may be in trouble.”

Action on phoenixing

The new laws also clampdown on ‘shadow directors’ and corporate ‘phoenixing’ in the building and construction industry, allowing the Government to impose a ban on anyone who has been secretly involved in running a construction company that goes bankrupt or has its building licence revoked.

Anyone who receives a ban under the new laws will face major penalties if they try to run another building company, either in their own name or by once again giving secret directions from behind the scenes.

“We have seen recent cases across the state where companies appear to have been designed to fail,” Mr de Brenni said.

“You shouldn’t be running a dud business under your nanna’s name, or anyone else’s. You shouldn’t get away with running under the radar.

“Lumping others with your debts, deliberately sinking your old company and secretly slinking away to a new business is disgraceful, base behaviour. It’s a low act.”

Project Bank Accounts

Mr de Brenni said that the Palaszczuk Government’s new ‘project bank accounts’ would provide the strongest protections for subbies anywhere in the nation.

“Our landmark security of payment reforms will see Project Bank Accounts introduced on Government projects between $1 million and $10 million from January 1 2018,” Mr de Brenni said.

“Project Bank Accounts are not designed to stop building industry insolvencies on their own.

“But they will stop a dodgy builder from using funds from one project on another project. They will prevent dodgy operators from syphoning subbies funds for personal use.

“From January 1 2019 Project Bank Accounts will be expanded to all private sector construction projects over $1 million.

“We have listened to industry and under our new laws we will also have the ability to expand PBA’s down beyond the first tier of subcontractors—to protect subcontractors and suppliers further down the line.”

Mr de Brenni said the Palaszczuk Government’s comprehensive suite of subcontractor protections is the result of almost two years of extensive consultation.

“These reforms are considered and comprehensive,” he said.

“For decades subcontractors have been crying out for real action to fix these abhorrent practices.

“Only Labor has had the political will to get the construction industry on the level. It’s time for Tim Nicholls and the LNP to show some courage and be on the right side of history when it comes to supporting construction small businesses.”

ENDS

Media contact: Tristan Douglas 0447 164 197