House debates

Thursday, 17 July 2014

Constituency Statements

Gilmore Electorate: Hewitt Earthworks Subcontractors

9:59 am

Photo of Ann SudmalisAnn Sudmalis (Gilmore, Liberal Party) Share this | Hansard source

) ( ): Mr Speaker, Gilmore is proud to have HMAS Albatross in our region, especially as it is the new Romeo helicopter training location. Our local subbies secured many of the subcontracts, working extraordinary hours and purchasing additional machinery to comply with the OH&S standards like specific reversing cameras imposed by the contracting companies Lend Lease and Hewitt Earthworks. They were confident in the process of payment: the Department of Defence pays Lend Lease, who pays Hewitt, who then pay the subcontractors. The guarantee for the process is the existence of statutory declarations from subcontractors saying that they had received payments.

After extensive investigation the Department of Defence has determined that their contractual commitments have been met. But somehow the system has failed. Hewitt Earthworks recently went into voluntary administration, with rumours that the company knowingly traded possibly insolvent for around a month before its collapse. Some of our hardworking local subcontractors are facing bankruptcy: the debts are around $2 million and more to come—unpaid invoices go back to March, April and May. Lend Lease was made aware of the potential problems with Hewitt in late March. The only result was that the reporting subcontractor was refused any more work. Mark Nielson of Coordinated Logistics called on Lend Lease to enter into negotiation; this has not happened.

These subcontractors have asked me to put these questions to parliament: where has this process fallen down? When were the non-existent statutory declarations reported, and which company was responsible? Who certified at what stage? These creditors were advised to seek legal counsel and pursue their payments via the New South Wales Security of Payments Act. This is not an option. Hewitt put itself into voluntary administration, meaning that the subcontractors cannot begin, continue or enforce their claims without the administrator's consent or the court's permission—leaving the subcontractors no avenue of redress. They cannot even apply to put the company into liquidation, which would give more payment options.

Where does this leave my local subcontractors? Up the paddock without a backhoe. Other subcontractors have spoken up—they are united and brave. Their chance of more work is now gone. There are others, but the fear of reprisal is too great. Yes, there is an underpinning threat that if you speak out you will not get work. It is a system of threat and corporate bullying. Mark Nielson was the first to speak out and the first to lose work. Now he is faced with terminating his employees, releasing his apprentice, cancelling the purchase of machinery that had been ordered and notifying eight of his subcontractors that there is no more work. I call on the company director, Geoff Hewitt, the administrators and the Lend Lease contract management team to meet with and resolve this appalling situation and save our Gilmore subcontractors. They deserve honest payment for their honest work. There is no honesty or fairness in this situation.

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