Aussies face bill of more than $28 million if Metricon collapses

As fears mount that Metricon is on the verge of ruin, it has been revealed that taxpayers may have to fork out an eye-watering sum.

As fears mount that Metricon is on the verge of ruin, it has been revealed that taxpayers may have to fork out more than $28 million to bail out families left with unfinished homes.

For days now, it has been speculated that Australia’s biggest builder was on the verge of ruin as claims the company had hit financial problems emerged.

On Wednesday, acting CEO Peter Langfelder shot down those allegations, declaring it was “business as usual” in a press conference on a building site, although he admitted the company was experiencing some delays on projects.

Despite this statement from the company, Metricon representatives met with the Victorian government on Thursday for crisis talks about the escalating issues plaguing the sector, including the surging costs of essential materials such as timber and steel.

Now, senior government sources and former HIA chief economist Harley Dale told The Daily Telegraph they fear NSW’s Home Building Compensation Fund could be overwhelmed by 350 homeowners who may make claims for unfinished work. The fund covers people for up to 20 per cent of the contract cost.

With the average build in NSW costing around $400,000 and Metricon having 350 active construction sites around the state – it is estimated that taxpayers could be forced to fork out up to $28 million to pay out with unfinished homes in NSW alone.

Houses under construction in Minta Estate Berwick. Picture: David Caird

In each state and territory, there are similar schemes run by respective governments that could see the cost to taxpayers balloon even further in the event of a collapse.

Claims of up to $200,000 can be made in Queensland where, so far this financial year, Metricon has undertaken 1006 home construction jobs.

Claims up to $300,000 can be made under the a similar scheme in Victoria, where a collapse of the construction giant would spell chaos.

There, Metricon holds $195m worth of contracts with the state government, including a five-year deal to build and maintain public housing as part of Victoria’s ambitious “big build” infrastructure program.

In total, Metricon had 6052 homes under construction across the nation in 2020-21.

Its projects in Queensland alone are worth more than $400m, according to Queensland Building and Construction Commission records.

Rumours about Metricon’s future began to swirl this week after the death of its founder Mario Biasin.

Mr Biasin died unexpectedly on Monday at the age of 71, after reportedly experiencing mental health issues.

His death came just days before the firm entered crisis talks amid rumours it was facing financial difficulties.

‘Baseless rumours’

Despite fears over the company’s future, an email sent to Metricon customers on Thursday hitting out at “baseless rumours” it was in trouble, instead insisting it was “business as usual”.

“Good afternoon, We wanted to reach out following media speculation about the future of our company,” the email begins.

“Today we reaffirmed our long-term viability, following the sudden death of co-founder and CEO Mario Biason on Monday via a media statement.

“Our displays remain open for business as per normal and our new home advisors are ready to help you start your new home building journey.

Metricon acting chief executive Peter Langfelder. Picture: Kiel Egging

“Our acting CEO Peter Langfelder fronted the media this afternoon, in an effort to put an end to baseless rumours.”

The email included quotes from acting CEO Mr Langfelder, who said Metricon was a “long-term, viable business, with a strong history of performance”.

“All our contracts are profitable, and we are up to date with all our payments: to contractors, suppliers, employees and tradies,” Mr Langfelder said.

The email then signed off with the claim that is was “business as usual and our team are ready to assist you”.

‘Very upsetting’

Meanwhile, a number of Metricon customers have come forward to share their alarming stories as the crisis rages on.

One of those is Brisbane woman Kim James, who told A Current Affair construction on her new home began 10 long months ago, before the work stalled.

“It’s very upsetting and it’s caused a lot of stress. Just not on me, but my whole family as well,” she told the program.

“Because you think, ‘what’s gonna happen next’? And then now you think, ‘am I gonna get a home? I just want a house’. That’s all I want is a house.”

Many Aussies remain doubtful Metricon will survive. Picture: David Caird

NSW couple Jessica Snowdon and her husband Steve also told news.com.au they were terrified by the Metricon situation after forking out $31,500 in an initial deposit to the firm just four weeks ago.

“We were just freaking out [when we saw the news], what’s going to happen?” Ms Snowdon told news.com.au.

“It’s scary because we don’t know whether to pull out or not, if we pull out we still lose our money.”

– with Sarah Sharples