Unions back probe into collapsing builders
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SYDNEY, Aug 9 AAP
August 09 2012, 1:44PM
They're in the game of building, but lately the NSW construction industry seems to be collapsing into a pile of rubble.
On Thursday, the NSW government announced a parliamentary inquiry into the plagued industry - a move which has been welcomed by unions.
Hundreds of companies, owing workers and suppliers billions of dollars, have collapsed since 2009, according to the government.
The Construction, Forestry, Mining and Energy Union (CFMEU) said it had been calling for an inquiry for more than six months and hailed the announcement as a victory for workers.
"We need a system that guarantees principal contractors and developers cannot touch money that is owed to sub-contractors, suppliers and workers," CFMEU NSW President Rita Mallia said in a statement.
Unions NSW also backed the move saying it was vital to protect workers from collapsing companies.
"In recent years we have seen hundreds of companies collapse in NSW leaving thousands of workers out of pocket and crippling vital projects for the state," Unions NSW Secretary Mark Lennon said in a statement.
About 24,000 suppliers and sub-contractors have not been paid for their work over the past few years, with some owed millions of dollars, according to NSW Finance Minister Greg Pearce.
In February, building company Kell and Rigby announced it was closing its doors, leaving 500 workers without a job and hundreds of associated businesses millions of dollars out of pocket.
In the same month, it emerged that Reed Construction was in financial difficulty and unable to pay millions of dollars to more than 50 subcontractors.
Two months later, St Hilliers Ararat, an arm of St Hilliers Construction, went into voluntary administration costing hundreds of jobs and leaving sub-contractors out of pocket.
The inquiry will be headed by former ICAC Commissioner Bruce Collins, QC, and will look at the extent and causes of insolvency in the industry.
But CFMEU State Secretary Brian Parker told AAP he was concerned the move was a kneejerk reaction.
"We're majorly concerned that the minister is doing a little bit of politicking (sic) on this one," Mr Parker said.
He called for the union to be actively involved in the inquiry.
The government says calls for submissions will be made next week and the inquiry will run for about three months.