Building industry collapse: Call for a Royal Commission to help Gold Coast subbies
There are calls for a Royal Commission into the building industry following the latest developments in the Cullen Group collapse, with claims subbies have lost half a billion dollars in 50 builder collapses since 2013.
Gold Coast
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BURLEIGH MP Michael Hart has called for a Royal Commission into the building industry following the latest stunning development in the Cullen Group collapse.
The LNP State frontbencher has written to Federal Attorney-General Christian Porter after speaking to subbies who face losing more than $8.4 million in payments.
The Bulletin in a report on the weekend detailed how the liquidator was seeking the money from 29 subcontractors alleging the respondents had received “unfair preferences” in the six months before a Robina site was shut down in December 2016.
Mr Hart told the Attorney-General that there had been 50 companies which had collapsed since 2013.
“Sadly, this has been accompanied by over 7000 subcontractors left empty-handed to the tune of half a billion dollars and more developers now face closing their doors,” Mr Hart said.
“In addition, frequent complaints from consumers relating to defective work and lengthy delays for repairs continue to attract extensive media coverage.
“This situation is not unique to Queensland and is something that could equally apply in the other States and Territories. The leaders of industry groups have advised that in their view, the system is broken.”
Mr Hart said the LNP earlier this year had announced that if elected in 2020, it would call a Commission of Inquiry into Queensland’s building industry.
“This announcement prompted the State Labor Government to convene a Special Joint Taskforce to investigate complaints and allegations of fraudulent behaviour that have led to subcontractor non-payment,” he said.
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The Taskforce commenced on 27 March 2019 with submissions closing on May 17, he added.
“The Final Report of the Taskforce was submitted on 30 June 2019 and is currently being examined by the State Government. It is understood that over 150 investigations and prosecutions will flow from the work of the Taskforce,” Mr Hart said.
The LNP was concerned the terms of reference for the Taskforce were too narrow,
and the time frame too tight for a detailed examination of all the issues impacting
the building industry to occur, he said.
“With its broad powers, a Royal Commission would appear to be a more appropriate vehicle for examining issues in greater depth, as well as being well placed to consider cross-jurisdictional matters,” Mr Hart said.
“Some of the areas of concern such as the liquidation process, corporate structures and illegal phoenix activity fall outside State laws and extend to the Commonwealth.”
The Cullen liquidator in the latest update estimates the debt to unsecured creditors would not be less than $37 million.
At this point of the liquidation, he believes unsecured creditors would be lucky to receive a dividend of “move than five cents in the dollar”.
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