The linked article was published in The West Australian last week and we feel the need to comment.
While we don’t necessarily agree with everything said in the article, as a builder engaging over two hundred contractors, we do agree with a lot of what has been stated by the anonymous subcontractor. The current system does not provide much protection for the subcontractors to receive payment on time or at all. Too often we see Builders go into administration, leaving many contractors out of pocket due to outstanding invoices. Sadly many good contractors also then need to shut their doors as they cannot trade their way out of the unpaid invoices from the Builder who went into administration. This has a negative effect on the industry because it removes some really good contractors from the market (not to mention the emotional toll it takes on people losing everything from ‘no fault of their own’). It also discourages the good contractors to start their own business due to the many risks of not getting paid on time or at all.
We also agree that the current system allows builders to take advantage of contractors too easily by not paying them on time due to various reasons. Unfortunately, we see this happening far too often in the industry. Alita Constructions’ has a strong belief that trades who fulfill their contract correctly deserve to be paid in full and on time. We have a strong moral and ethical stance on how we treat our subbies as we all know in a lot of ways that we are only as good as our trades and like everyone in the workplace, they deserve to be treated fairly.
Therefore, we generally don’t have retentions (unless the head contract asks for it) and we pay trades on time.
We believe change is certainly needed for the benefit of both builders and contractors. We think something like a Project Specific Fund Account should be looked at as a serious way forward as this will guarantee both the Builder and Contractor getting paid if they fulfill their contract correctly. As mentioned in the article, insurance schemes could also be another option but either way, let’s continue the discussion so hopefully, with enough momentum, we can see some changes in the near future for the better of WA families in the construction industry.