State government establishes special investigative unit to protect subcontractors against non-payments

NECA WA is delighted with the Western Australian Government’s establishment of a special investigative unit within the Small Business Development Commission which will have sweeping powers to investigate claims of non-payments by head contractors on state government projects.

The new powers will allow the Small Business Commissioner to compel head contractors on state government projects to prove payments have been made to its subcontractors.

The Commissioner will be able to protect the identity of the subcontractor making the complaint, and will also be able to make recommendations to the government in regard to potential sanctions against head contractors who are proven not to have paid subcontractors.

This is the first step of the government’s response to the issue of non-payments within the construction industry. The government is continuing to assess a number of other potential reforms to protect subcontractors and NECA WA welcomes this first initiative from the government.

NECA is also very active on the issue of non-payments to subcontractors at a national level, as can be seen in a recent article by NECA’s National CEO, which was published in the Australian Financial Review. This article was written in response to an earlier story highlighting the considerable increase in the rate of insolvencies within Australia’s building industry.