QBCC under fire for its pre-Christmas blitz to suspend 2640 licences

The building regulator is under fire for its ‘extraordinary and erratic’ move to suspend the licences of 2640 contractors, who are mostly struggling small business owners.

Most of the contractors who have had their licences suspended are small business owners.

A pre-Christmas blitz by Queensland’s embattled building industry watchdog has seen it suspend the licences of a staggering 2640 contractors.

By contrast, similar action was taken against just 66 operators in all of the last financial year.

The shock move by the Queensland Building and Construction Commission took place last month and targeted small business owners for “failure to comply with minimum financial requirements’’.

Yet none of them were suspended for failing to pay their debts.

The majority of those impacted had annual turnover of less than $800,000 and have been hard hit by significant pressures stemming from trade contractor and supply shortages.

Minister for Public Works and Procurement Mick de Brenni

Industry insiders said Tuesday they were stunned by the action, especially since records show the QBCC had only suspended a total of 831 licensees since 2015.

“The QBCC’s targeting of smaller licensees in large numbers is unjustified given these licensees are typically mum and dad operators who are paying their debts and pose no financial risk to the community,’’ one critic said.

“The suspensions also come as a blow to industry as there are well-known contractor shortages.

“The actions by the QBCC are particularly callous given that it is Christmas and so many contractors are currently under extreme stress because of industry wide supply and cashflow issues.’’

Tim Mander, the shadow Minister for Housing and Public Works, described the surge in suspensions as “extraordinary and erratic’’.

“A 3900 per cent increase is off the charts and is something the QBCC and Minister Mick de Brenni must provide an explanation for. Queenslanders deserve to know that the QBCC has its priorities in order,’’ Mr Mander said.

Shadow Minister for Housing and Public Works Tim Mander

A spokesman for Mr de Brenni, the minister for Public Works and Procurement, defended the QBCC.

“The minimum financial requirements are an important measure to help protect consumers and the more than 51,000 licensees in this category – or more than 95 per cent – who have played by the rules,’’ he said.

A QBCC spokesman said the annual reporting deadline for licensees was March 31 but those suspended could still lodge their financial information.

“The QBCC will then consider their individual circumstances and may lift suspensions in appropriate cases,’’ he said.

Many of the small businesses caught up in the QBCC’s crackdown act as subcontractors, the parties most at risk of not getting paid or receiving late payment because they are at the bottom of the contract chain.

“They are typically the financial casualties of poor payment practices, not the cause,’’ one industry figure noted.

Indeed, the QBCC’s latest annual report reveals that $39m worth of debts were paid late by licensees to subcontractors and suppliers in the last seven years.

Yet records reveal the agency failed to take disciplinary action against any of the responsible licensees for their unscrupulous payment practices.

In a Facebook posting last week, the QBCC also revealed that it had cancelled 203 licences last month for failing to comply with minimum financial standards and another 27 for other reasons.

The QBCC’s latest actions cap a year that saw the agency face harsh criticism for its internal dysfunction, which has prompted the departure of numerous key executives and helped trigger an external inquiry set to report next year.