Missing millions sparks row over government project

Businesses $15m out of pocket have threatened to sue the Andrews government over the Western Roads Upgrade. This is why.

The Andrews government has been accused of short-changing nearly 20 small businesses by $15 million on one of its major roads projects, with contractors left unpaid a year after it was completed.

The Herald Sun can reveal a class action is looming against the state over the Western Roads Upgrade, with a group of small firms frustrated the government is refusing to help them.

The $1.8 billion project was a package of eight major road improvements in Melbourne’s western suburbs, with each upgrade broken up among large contractors.

But one of these contractors, Civilink, went under amid soaring cost blowouts on the project and small businesses who performed work remain out of pocket.

A group of them are now pushing for the state government, who commissioned the project, to step in and pay the money they are owed and a legal challenge is expected.

The group wants the Andrews Government to pay the money they are owed. Picture: NCA NewsWire

The government is also facing questions about how it secured the work, amid allegations Civilink traded while insolvent and that companies were awarded major contracts without checking whether they were stable or properly accredited.

Subcontractors such as Kingston Plant Hire, say they are frustrated because the project was spruiked as a chance to help Victorian businesses grow into bigger construction firms.

But instead of benefiting from the work, they have been left millions out of pocket and facing severe financial stress if they are not paid.

It comes after the state government agreed to pay out $1.9b in taxpayer funds to builders on the troubled West Gate Tunnel and $1.35b on the Metro Tunnel.

Kingston Plant Hire’s chief financial officer Alfred De Vito said they estimated they were owed more than $955,000 alone from their work on the Western Roads Upgrade.

“It bloody hurts,” he said.

“The state has a responsibility to make sure who they engage with are ethical companies.

“What I’d like to see of the government is to make it harder for companies to go under.

“It has just burned all these smaller subbies but lined someone’s pocket.”

Minister for Transport Infrastructure, Jacinta Allan has been contacted about the issue. Picture: NCA NewsWire

It is estimated as many as 200 businesses may have been impacted by Civilink’s collapse but a smaller number are looking at legal action after being left significantly out of pocket.

In June last year, peak body Consult Australia wrote to Transport Infrastructure Minister Jacinta Allan seeking an urgent response about how subcontractors could regain their lost money.

But the state has pointed to a complex layer of contractors to say it does not have a role in paying these companies for work.

Major Roads Project Victoria paid out cash settlement with WBHO Infrastructure, who hired Civilink, and considers that the end of the matter.

WBHO, who hired Civilink, was owned by the now collapsed ProBuild. Picture: Andrew Henshaw

It does not know if Civilink has repaid the money it owes and has no oversight of this.

WBHO, owned by the now collapsed ProBuild, also lost a whopping $202 million on the project and has also gone under.

“The Western Roads Upgrade is being delivered by Netflow through a public-private partnership,” a A MRPV spokesman said.

“Netflow contracted WBHO Infrastructure to deliver the Design and Construction for the whole Western Roads Upgrade project.

“Netflow have advised the State that entitlements to WBHO have been paid.”