Subcontractor calls out system allowing builders to walk away ‘scot free’ owing millions

A subcontractor who lost his marriage and almost lost his business following the collapse of a building company has highlighted the hypocrisy of a system that holds businesses like his accountable for debts but sees failed builders walk away “scot free” owing millions.

SEAN Gummerson is still digging himself out of a hole that cost him his marriage, his savings and almost his business.

Two years on from the collapse of CMC Building and Design, the trading name for the Ashtay Group, he can see a light, but it’s been a long time, and a lot of hard work, to get to this point.

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His invoice for $111,000 for work and materials was due payable in two weeks when the Ashtay Group went into liquidation in January, last year.

Other subcontractors on the Sanderson unit complex in Annerley were muttering.

Some, he said, had invoices that were four months overdue.

“It didn’t end the business but it put me under a lot of pressure,” Sean said.

“It contributed to my relationship split - it played a major role.

“If a builder doesn’t want to pay its debts they just walk away. I didn’t want to fold. I did the hard yards to ensure my suppliers were paid but I’m not getting anywhere.

“It’s hard every month.

“The tax man doesn’t care. There’s no relief, he still wants his money.

“You don’t get any help. You fold or make ends meet.”

Electrician Sean Gummerson has been affected financially and personally by the collapse of building and construction companies. Picture: AAP Image/Josh Woning

Uncertainty about payment for the work he does and materials he supplies has left Sean wary of employing staff.

Instead he now engages other subbies as, and when, needed.

The workforce he once employed has long gone.

“There were others on the job whose invoices were four months overdue.

“I don’t let any builder get overdue now. If they were, my policy is to stop work. You can’t afford to do it.

“If you don’t pay the tax man you go to jail. If a builder doesn’t pay his bills he walks scot free.

“How does that work?”

WHY MORE BUILDERS WILL GO BROKE

The project had been the first big contract Mr Gummerson’s electrical business, SDG Communications, had secured after trading for two years.

It was almost his last.

Sean was force to sell equipment and a truck, shrank his labour force and tipped in money from savings to survive. He has another year of slog before he’s back to where he was.

“I’ve come to terms with it. It’s a tough old gig,” he said of the construction business.