Nahan takes on construction union’s wages push

The West Australian, November 19, 2016:

Treasurer Mike Nahan has threatened to ban big WA building companies from government contracts if they agree to new wage demands being sought by the construction union.

Dr Nahan has asked the Australian Competition and Consumer Commission to investigate the CFMEU push, which has already led to a national firm agreeing to a 20 per cent wage rise over four years.

The Government is concerned the deals will push up the cost of big projects in WA just when it hopes to embark on a major infrastructure spend from the proceeds of the sale of Western Power.

Dr Nahan’s move is an aggressive shot across the bow of one of the State’s most militant trade unions just months out from an election in which it will play a key role in Labor’s campaign, having recently increased its influence within the party through a membership drive. The Barnett Government is putting the WA construction industry on notice that a new code it intends to introduce before Christmas will outlaw the deals the CFMEU is seeking.

“Breaches of the code, including on private non-government work, may result in a contractor being ineligible to be involved in WA Government construction projects,” Mr Nahan said in a letter sent to local operators this week.

He claims a CFMEU letter dated September 8 could be construed as an invitation for the builders to enter into arrangements that contravene competition laws.

“I further advise that a key component of the WA construction code will be a prohibition on collusive tendering for WA Government work. I have a responsibility to the taxpayers of WA to ensure value for money in the construction of those projects,” the letter said.

“To achieve this, a fair, open and competitive construction market in WA is vital. The CFMEU letter suggests that this is at risk, threatening the viability of WA Government projects.”

It is believed Dr Nahan’s letter went to four companies — Probuild, Brookfield Multiplex, Lendlease and another national builder operating in WA not named by the CFMEU but which it says has made an in-principle agreement.

The CFMEU letter said the union was “commencing negotiations with a number of other builders.” CFMEU claimed workers have deteriorating working conditions while sub-contractors must tender for low margins.