Contributed by Jim Hayes
Melbourne based developer, Grocon, has just taken a hit in Queensland, with its licence suspended by the Queensland Building and Construction Commission (QBCC), as an investigation into its finances continues.
It seems that the company has made a big loss on the Commonwealth Games Athletes Village and apparently, they are $16.7 million in the red over two other projects, valued at more than $1 billion. The QBCC is not satisfied that the business is viable enough to merit taking on more jobs.
The political establishment has reacted to this with a wall of silence. If it had been anyone else, especially unions in the industry, the resulting condemnations would have driven many of them hoarse within hours. In this case, the apparent laryngitis, comes from the habit of harbouring this and some other similar construction companies as allies.
Construction companies donate significant amounts to political parties and have therefore established useful political links. Grocon has relied quit a lot on building its links through a war against construction unions., which has germinated into a cosy alliance with the federal and state governments. Canberra’s industry code brought benefits, in terms of legal assistance to push down wages and conditions, punish workers and unions acting on this and providing government contract rewards, through the building industry code measures that a that bars employers reaching better agreements with their own workforce. Industry safety conditions and public safety have been major casualties.
Grocon has a track record in cutting corners and this has more than once exacted a heavy price on others. In August this year VicRoads sued for damage caused in Elizabeth Street in Melbourne. In 2013 there was the Swanston Street wall collapse that killed three young pedestrians, over which it faced criminal charges.
These are two examples of cases of a long list of cases that have attracted a slap on the wrist at most. Will it be the same for the Elizabeth Street incident? This was certainly the case with the Swanston Street wall collapse.
Governments have been complicit in creating the sort of environment that encourages cowboy behaviour amongst those that are favoured, simply because this sort of conduct has proved to be profitable.
Another indicator of the nexus between developers and the political establishment has been the failure to legislate to ban building materials, such as that which caused the Grenfell inferno in London.
Meanwhile, Grocon has applied to the Queensland government for a $50 million bailout. Although it may be difficult to get this under the present circumstances, it doesn’t depart from what has developed to be business as usual in Australia. Queensland is no exception to this.
The industry will be plagued with problems, so long as this arrangement persists.
How long will it be before Grocon is rescued once again?