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Estimates: QBuild and building company collapses

During Parliamentary Budget Estimates on Tuesday 8 August 2023, I asked about the potential for Qbuild to take over building contracts held by collapsed companies.

You can read the answers below or in the official Queensland Parliament Record of Proceedings (Hansard).

Mr BERKMAN: I am sure it has been lost on no-one that we have seen a number of construction company collapses over the last year that have in some cases delayed the construction of thousands of homes. Just last week we learned that another Queensland-based builder, GCB Constructions, has been placed into administration, leaving potentially hundreds of units unfinished. My first question is to the director-general. Can you outline for the committee what barriers exist to QBuild potentially taking on these contracts as construction manager and potentially as a public housing build? I am thinking of barriers like staff capacity, wage competitiveness or any strict regulatory barriers.

CHAIR: There are quite a few questions there but if the director-general can answer them.

Mr Martyn: I thank the honourable member for the question and for his interest in QBuild. QBuild exists to undertake work in the public sector. Last year was our 160th anniversary. We talked about the fact that we had a proud heritage but also a big future. QBuild is not only growing in terms of the size of its workforce; it is also innovating. We have heard the minister talk today about the modern methods of construction process which is allowing us to deliver more government key worker housing and social housing, particularly in regional and remote Queensland, where it is harder to get public sector capability. In terms of whether or not QBuild can do more social housing, we are always talking with our colleagues in the Department of Housing about how we can lean in to help them to do more, and we have had some very constructive conversations with them. That is a range of issues around how we build more houses more quickly and how we reduce wait times in terms of turning houses over and getting them back to tenants. We are very conscious, though, that QBuild is not a direct competitor to the private sector. We have our particular niche and I think we do it well. What I would say is that we are trying to do it differently and better. I think what you are seeing is significant effort in that regard. We do work in partnership with the private sector, so the modern methods of construction process has been an example of learning from the private sector because they have been doing modular housing much longer than QBuild has. We are learning that, applying it and building up our own capacity. As the minister said, we have the Eagle Farm facility. We will soon have an answer on the Cairns facility. We will be able to provide more public housing, more government worker housing in the cape which is often hard to do. QBuild is doing a lot, it is expanding rapidly, and it is doing it in a way that supports the government’s objectives. It is potentially outside of this portfolio, but clearly the government as a whole adopts the approach of working with both the public provider and the private sector to address those housing needs.

Mr BERKMAN: Minister, I want to ask along the same lines as to whether you or the government have considered the potential for QBuild to pick up those crash construction contracts and whether it is something you might be interested in, that expanded capacity for QBuild?

Mr de BRENNI: First of all, I think it is really important to recognise that where there are those insolvencies—as I indicated, they are on average half now than what they were under the LNP administration—and homes do not get finished, that is a difficult time for those home owners with a lot of stress and a lot of anxiety. There are a range of reasons that is happening in the economy at the moment and, as the commissioner indicated before, it has had a particular impact in terms of the workload coming through in terms of non-completion claims. I do want to provide this assurance to Queenslanders who are considering building a home: they have the nation’s best home warranty insurance product. It is the only first-resort product anywhere in the nation. If you are in this circumstance in other states and territories, you are off to court and you have to find the builder. If there is no builder there, you really have no recourse, so you are left out in the cold. Here in Queensland, the non-completion process under the Home Warranty Scheme which is recognised by Choice as the best in breed in the nation, will work with you to complete your home. In terms of whether QBuild would lean into that, we are already at capacity in terms of the work that we are doing for the public sector. We are building social housing, government employee housing, repairs and maintenance to our schools and hospitals. That needs to be our No. 1 focus to ensure that public infrastructure is there. We are building government employee housing and social housing to take pressure off rents as well. It is really a program between the QBCC, its service providers and the private
sector that is best placed to deliver that range of completion products. I have given general thought to it, but there is no capacity within our organisation to lean into that at this stage, and I think the current
arrangements are best placed for consumers and the overall outcomes for the state.

CHAIR: We have a question that was not taken on notice, but with the QBCC Commissioner, if we can get an update on the CCC matters that have been forwarded back to the QBCC as to their status, if you have the ability. It will not be taken on notice unless the minister wishes to. Do you have an update?

Ms Levy: I do have an update. There were eight referred back to the QBCC that were deemed not to require any further action, and there are three that are still ongoing.


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