The Queensland Government has accepted most of the recommendations of the Queensland Productivity Commission investigation of the state construction industry.
Treasurer, Minister for Energy and Minister for Home Ownership David Janetzki said the moves would help boost a sector “strangled by red tape and union indulgence”.
He said the government had agreed to 51 of the 64 recommendations.
These included:
- Permanently removing the former government’s controversial “Best Practice Industry Conditions” from procurement policy
- Removing pre-qualification for sub-contractors on government construction projects
- Removing policies that added complexity to the procurement process and removing barriers to innovation and competition.
- Providing greater guidance on health and safety regulation, including mechanisms for dealing with WHS disputes and the use of right-of-entry provisions
- Reviewing regulator powers in conjunction with the Wood Commission of Inquiry
- Introducing a less prescriptive and better targeted policy to boost the number of construction apprentices
- Reviewing available training courses to ensure skills needed for modern methods of construction are appropriately represented.
- Progressing Queensland’s participation in the Automatic Mutual Recognition scheme and streamlining the licensing process for migrants.
The Commission called for an “industry reset” to address sector productivity declining by 9 percent (equating to 77,000 fewer new homes) since 2018.
Labour productivity had grown just 5 percent in the industry in the last 30 years compared to 65 percent in the market economy over the same period.
Master Builders Queensland CEO Paul Bidwell said the commission had noted there was no “silver bullet” to lift productivity in the sector.
He welcomed the government’s response to the final commission report but said that simply “noting” some of the recommendations would not deliver the required pace of reform.
“We’d hoped that the State Government would accept the recommendation from the QPC to opt-out of the NCC standards related to energy efficiency and accessibility, owing to the net cost to the community,” Mr Bidwell said.
“Our own research tells us that making these changes voluntary, as the QPC recommended, would save around $44,000 per home, helping unlock stalled projects during the housing crisis.
“Instead, the government has hung its hat on progressing technical amendments and industry guidance materials, which, while important, fall well short of fixing the problem.”
Industry had also called for the government to scrap Project Trust Accounts (PTAs) – another barrier to the delivery of new homes via increased cost and complexity, without protecting payment security for subcontractors if a business goes bust.
“Again, the government has ‘noted’ the QPC’s recommendation that if it can’t be demonstrated that the benefits of the framework outweigh its costs, the framework should be removed,” he said.
“We have already applauded government when they put a pause on the further rollout of PTAs – and while government has stopped short of dispensing with them, we’re keen to continue working together towards an effective and fair security of payment system.”
Mr Bidwell said earlier wins such as the scrapping of Best Practice Industry Conditions, a trimmed Queensland Procurement Policy (cutting red tape for small business), the modernisation of the QBCC and the CFMEU inquiry and the work of the union Administrator were all key to restoring productivity.
“It’s time to get on with delivering all the possible reforms already identified to lift productivity, reduce costs, and get new homes out of the ground,” Mr Bidwell said.
“Industry will continue to work with government to make it happen.”
Housing Industry Association Executive Director Planning and Development Sam Heckel said the HIA welcomed the Government’s support for the majority of recommendations.
However, the “refusal to address key barriers imposed by local governments through the planning system” was a significant missed opportunity.
The Queensland Productivity Commission report can be found here.
