By Greg Weller
Last Wednesday, the Senate passed the government's legislation to re-establish the building industry watchdog, the Australian Building & Construction Commission (ABCC). This issue was, of course, one of the triggers for July's double dissolution election.
HIA has for some time advocated for the return of the commission and last month members of our policy team appeared before the Senate Standing Committee on Economics inquiry into the legislation.
Bringing back a tough cop on the building industry beat can help start the process of ridding the industry of outdated industrial practices, HIA says.Credit: Graham Tidy
Four years ago, the ABCC was abolished, to the detriment of almost everyone in the building industry, except those who were breaking the law. The industry has been bridled by systemic industrial lawlessness, coercion and intimidation, particularly in the commercial sector. This has been well documented by two royal commissions and numerous other inquiries.
Bringing back a tough cop on the building industry beat can help start the process of ridding the industry of outdated industrial practices. It is in the interests of all Australians to have increased productivity on our building sites and lower costs of construction.
And this is by no means about just the questionable practices of unions. If large companies willingly do deals knowing that all their competitors have entered a similar agreement with a union, invariably the taxpayer pays over the odds for a project and prices everywhere else in the sector are inflated.
The government didn't get things all their own way, with it having to give ground to Senators Derryn Hinch and Nick Xenophon to secure their vote.
The government had originally proposed that the bill would apply retrospectively, meaning that some existing construction enterprise agreements that included unproductive, anti-competitive clauses would be non-compliant, however, an amendment proposed by Senator Hinch will mean that a builder with these agreements will continue to be eligible to work on federally-funded projects for another two years.
An issue of big interest to HIA members is an amendment put forward by Senator Xenophon that will begin addressing the problem of non-conforming products on large government jobs. Imported building products that don't come up to scratch is something I've talked about before here, and the HIA has worked extensively with Senator Xenophon in the past on this problem.
From next year, where an Australian standard is applicable for goods or services being procured by the commonwealth, the tender must demonstrate the capability to meet the standard, and contracts must contain evidence of the applicable standards.
This won't fully address the importation of non-conforming building materials, but will start to build an environment where domestic manufacturers are competing only with international suppliers that can provide evidence that they meet the equivalent Australian standards.
Both of these issues are about ensuring that there is competition and that is open and fair, which will give the best result for taxpayers and the Australian economy.