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

 

Christchurch: New Lyttelton Cruise Ship Berth To Be Built

A new $56 million cruise ship berth will be built in Lyttelton with the plans released by the Lyttelton Port Company today. More>>

Constructions Builds: Consents Top $2 Billion For The First Time

Building consents reached a record $2 billion in March 2017, boosted by new homes and several big non-residential projects, Stats NZ said today. This was up 37 percent compared with March 2016. More>>

Other Stats:

Health: Work Underway To Address Antimicrobial Resistance

As part of a global response the Ministries of Health and Primary Industries have today jointly published ‘Antimicrobial Resistance: New Zealand’s current situation and identified areas for action’ to respond to the changing pattern of antimicrobial resistance in New Zealand. More>>

ALSO:

Employment: Vodafone Announces Family Violence Policy To Support Team

From today, any of Vodafone’s 3,000 workers affected by family violence will be eligible for a range of practical support, including up to 10 additional days of paid leave per year. More>>

Burning Up Over Saturn: Cassini's Grand Finale

With propellant running low, NASA scientists are concerned that the probe might accidentally crash into one of Saturn’s nearby moons, which could contaminate it with Earthling bacteria stuck to the spacecraft. Instead, the spacecraft will be safely "disposed" in Saturn's atmosphere. More>>

ALSO:

Our Fresh Water: Monitoring Report Confirms Serious Challenges For Rivers

• nitrogen levels are getting worse at 55 percent and getting better at 28 percent of monitored river sites across New Zealand • phosphorus levels are getting better at 42 percent and getting worse at 25 percent of monitored river sites across New Zealand More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news