Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Specialist Trade Contractors’ Federation on Mainzeal

February 7 2013

Specialist Trade Contractors’ Federation calls for equitable treatment for Mainzeal sub-contractors

The Specialist Trade Contractors’ Federation (STCF) has warned that the 400 Mainzeal staff affected by the firm’s collapse is just “the tip of the iceberg”.

STCF president Graham Burke said there was likely to be three or four times that number of sub-contractors working for the company and now facing financial uncertainty.

He called for receivers PwC to provide assurances that sub-contractors will be treated equitably and that retentions which have been held by Mainzeal will be paid out.

Construction firms often hold up to ten per cent of a sub-contractor’s total invoice as a retention, without interest, for up to two years after the completion of a contract by way of a guarantee.

“While the Mainzeal staff, Inland Revenue, banks and finance companies will be the first to be paid out, sub-contractors are treated as unsecured creditors,” said Mr Burke.

“When Hartner collapsed in 2001 it was holding millions in retentions, the amount held by Mainzeal could run into tens of millions.

“The STCF has been lobbying for the introduction of a binding security of payment for sub-contractors. We are seeking assurances from PwC that Mainzeal sub-contractors will be treated equitably regarding payments owed to them and that retentions, which have been paid by the client, will be paid to the sub-contractors, who have provided the materials and labour and carried all the risk.”

Mr Burke said that some sub-contractors would be owed significant sums and, if they were not paid, that could make their own businesses insolvent.

“Potentially, if sub-contractor businesses start to go under because of this, it could create a ripple effect up and down the chain because they then may not be able to pay the smaller sub-contractors working for them, even those not working on Mainzeal sites.

“Also, if sub-contractors with large exposure to Mainzeal have to be wound up and can’t complete jobs they are working on for other construction firms, then those companies may struggle to find new sub-contractors willing to complete the work at historic rates.

“That makes it all the more important that the receivers act swiftly to provide answers for sub-contractors and some confidence for the industry.”

Mr Burke said that the STCF is also concerned that the issue of security of payments for sub-contractors is not reflected in amendments to the Construction Contracts Act which is due to go through the Bill process.

The Specialist Trade Contractors’ Federation is an umbrella group representing the interests of specialist trade contractors in New Zealand.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

BusinessDesk: SkyCity Lifts Minimum Convention Centre Investment To $430M

SkyCity Entertainment Group, the casino operator, has lifted the minimum it will invest in the Auckland International Convention Centre to $430 million and said total costs including land may be $450 million to $470 million. More>>

Statistics: Drop In Dairy Prices Leads Fall In Exports

Total goods exports fell $240 million (5.5 percent) to $4.2 billion in April 2015 compared with April 2014, Statistics New Zealand said today. More>>

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>

BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>


Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>

BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Housing: More House Price Gains Expected

House price expectations remain high, with a net 56% of respondents expecting house prices will increase. Fears of higher interest rates are fading, consistent with the RBNZ’s signals this year. Affordability and a lack of houses for ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news