Page 955 - Week 03 - Thursday, 14 March 1991
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So, Minister, that is a proposal that the Opposition is putting up in good faith to help the industry in this Territory and to help the many small subcontractors and suppliers. It is a simple technique of adopting a random audit unit within your department, well advertised and with a hot line, so that should problems begin to occur people have a person in the Government to speak to who can check it, and so that all head contractors or project managers are aware that their books may be looked at.
Another technique which may improve the position of subcontractors in relation to public works contracts is a proposal that the Opposition hopes to introduce some time in these sittings by way of private members' legislation to give subcontractors in this Territory the same legal guarantees that subcontractors have been given in Queensland, by way of a form of security over money being owed to head contractors. Queensland is the only State in Australia which provides this form of security by way of the Subcontractors' Charges Act, and it would be a step in the right direction for similar legislation to be introduced in the ACT. Again, it is not the sole answer; again, it does not guarantee that there will never be collapses in the building industry. By the nature of things, that cannot be done. But it does give subbies some degree of additional security by moving them up in the list of creditors.
The sad reality is that usually, when there is a collapse, it is banks and secured creditors that have first call on such assets that may remain in the collapsed company, and by the time unsecured creditors are paid there is very little, if anything, to go around. If there is any payment at all, it is a matter of a few cents in the dollar. So, that is a second technique which could be looked at. I am giving notice that the Opposition is moving in that direction; but we would, of course, be delighted if the Government were to take up that initiative itself and move it along.
So, firstly, we are talking about a random audit unit; and, secondly, we are talking about giving some additional security to subcontractors. The third suggestion for this Government's attention - and again the Opposition is putting forward positive suggestions to deal with a real problem in the community; we are not just taking points here - is to consider the viability of some form of insurance scheme within the public works contracting area; that is, to require as a condition of awarding public works contracts that there be a degree of indemnity insurance to ensure that subcontractors will be paid for work done in the event of a collapse.
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