Grocon collapse should spur national security of payment laws

Published: 20 Nov 2020

The collapse of construction company Grocon shows Australia needs effective national security of payment laws to ensure workers, subcontractors and small businesses are not left carrying the can when builders and property developers go into administration or liquidation, says the CFMEU.

“In nearly all instances it is small businesses and subcontractors who do the majority of the work on sites, but it is the big developers who hold back payments,” said Dave Noonan, CFMEU National Construction Secretary.

“This is a massive rort that has been besetting the industry for decades. The latest Grocon collapse is just like Groundhog Day for anyone who has been around the construction industry for any length of time.”

"The Federal Government is well-aware of the problem  and commissioned John Murray, former CEO of Master Builders Australia and a former construction lawyer with decades of experience to investigate the widespread industry practice of non-payment or late payment of money owed for work done."

"The Murray Report made 86 recommendations around national security of payment laws and the introduction of statutory trusts which the government has been sitting on since 2017."

“Master Builders Australia have consistently acted to stop the introduction of security of payment laws which only serves interest of big property developers and builders, and damages the small businesses and subcontractors who actually do the work in the industry.”

“We call on the MBA to support the recommendations made by their former CEO, John Murray, and do right thing for small businesses and subcontractors.