The Federal Government must urgently provide a new and expansive stimulus package with measures targeted to keeping the building and construction industry and the broader economy strong in the face of the Covid-19 shock.
Master Builders Australia CEO Denita Wawn said, "Building and construction is vital to the national economy and to local communities right around the country. The livelihoods of the 1 in 10 Australians employed in the industry are at stake as is the viability of the nearly 390,000 small businesses that make up the industry and the thousands of enterprises that supply them."
"Master Builders commends the Federal Government for the measures it has already announced including the $17.6 billion package for small businesses and households and also the move by the Reserve Bank to provide funds for banks and non-bank lenders to provide support to small businesses through this challenge," she said.
"They are important measures, but builders and tradies will not have the necessary confidence to take up tax incentives or keep employees and apprentices on their books if they do not have a pipeline of work," Denita Wawn said.
"We are calling for measures such as commissioning local builders to immediately commence maintenance, refurbishment and renovation works on government buildings and facilities around the country. This will not require extensive planning, could be actioned quickly and will provide work for thousands of small businesses in local communities," she said.
"Bringing forward already budgeted spending on social and transport infrastructure projects, for example, accelerating construction work on projects under way by spending the money allocated for 2021 now will provide an immediate boost," Denita Wawn said.
"Broad eligibility and simplicity of application and tendering is also important. Too often stimulus measures cannot be accessed by many SMEs due to restrictive eligibility criteria. The shackles must come off and money must be immediately injected into the economy by ensuring that eligibility requirements are as broad and as simple as possible. Giving stimulus measures sunset clauses will ensure that they are targeted only to meet the present danger," she said.
"These measures could also easily be replicated by state governments and local councils to great effect," Denita Wawn said.
"The Government must also urgently address the major threat to current building and construction projects posed by the potential enforcement of liquidated damages clauses due to delays caused by a range of Covid-19 related factors including compliance with government measures to slow the spread of Covid-19 such as social distancing, supply shortages and/or labour shortages due to quarantine arrangements," Denita Wawn said.
"The threat of millions of dollars in liquidated damages will quickly be hanging over the heads of the nation's major construction companies and thousands of sub-contractors and threatening their viability. Many businesses will be compelled to close their doors with a resulting loss of jobs that will hurt families and communities," Denita Wawn said.
"If clients including developers take commercial advantage of the impact of Covid-19 it will devastate the industry and the national economy. Master Builders has called on the Federal Government, to urgently announce that they will not pursue liquidated damages in Commonwealth contracts due to impacts of COVID-19 and that they send a strong signal to private clients that they should follow their example," she said.
"Importantly, the stimulus measures which we are calling for will deliver long-lasting benefits to the economy and the community which will help us bounce back and also help the Government achieve its policy objectives. We currently have under investment in housing, commercial buildings and civil infrastructure to meet our future population demands so money spent now in the building and construction industry will also pay-off in the long-term," Denita Wawn said.
