The Victorian government is being accused of ignoring a crucial warning months before one of Australia’s largest construction companies collapsed
- Victorian government under fire
- Opposition said warning made in construction sector
The Victorian government has been accused of ignoring a warning about problems in the housing sector months before Porter Davis collapsed.
In July last year, the Treasury and Treasury Department briefed then-housing secretary Danny Pearson about insolvencies in the housing industry and options to minimize risks to clients, the state’s opposition said.
Since then, more than 530 construction companies in the state have become insolvent, including nearly 150 specifically in the residential construction industry.
Despite that, the Andrews administration has made no reforms in the industry, said Jess Wilson, spokeswoman for the homeowners’ opposition.
The Victorian government has been accused of ignoring a warning about problems in the housing sector months before Porter Davis collapsed
The briefing was revealed in documents obtained by the opposition through freedom of information laws.
“As a result of this mismanagement, hundreds of hard-working Victorians may be stuck with half-finished houses or have lost their down payments and are not getting the insurance they are entitled to,” said Ms Wilson.
“Homebuyers who have lost deposits deserve to know why the Andrews government ignored options to better protect consumers.”
Prime Minister Daniel Andrews on Tuesday accused the opposition of playing political games in the wake of Porter Davis’ demise, saying he focused instead on supporting those customers heartbroken by the company’s collapse.
He said authorities had to properly diagnose the problems before the government could step in to help customers.
“I will be making announcements soon and they will make sense, and they will be the government standing behind the customers who have been horribly treated,” Andrews told reporters.
“Then, of course, we will take all possible measures against anyone who has done something wrong.
“There are more and more cases to show that there are people in that industry who have done something wrong.”
Mr Andrews said the company’s collapse due to a lack of $35 million indicated something had gone profoundly wrong.
Porter Davis homebuyers are wondering why they weren’t insured as required by law, including Richard Williams, who lost his $40,000 down payment when the company went bankrupt.
Despite the laws in place to ensure he was insured, no home insurance was taken out for him, meaning there is no legal remedy to recover his money.
It would have cost Porter Davis less than $1000 to insure his build.
Prime Minister Daniel Andrews on Tuesday accused the opposition of playing political games in the wake of Porter Davis’ demise, saying he focused instead on supporting those customers heartbroken by the company’s collapse.
It is estimated that 800 families have lost an average of $30,000 to $50,000 simply because they were uninsured.
The Victorian Building Authority is investigating whether Porter Davis may have broken any laws.
About 1,700 homes in Victoria and Queensland were in limbo when the company filed for bankruptcy last month.
Liquidators Grant Thornton confirmed Monday that Nostra Property Group would complete up to 375 of the homes left in limbo following the Porter Davis collapse.
On Sunday, dozens of Porter Davis’ clients gathered on the steps of Victoria’s Parliament and called for more support from the government.
Many said they needed financial and legal help to take their next steps and get their deposits back.
Deputy Prime Minister Jacinta Allan said the government is still assessing what steps it can take to support affected customers.
“If there are more details to announce, we will make those announcements,” she told ABC Radio Melbourne on Monday.
