A “favorable” deal given to unions has been frozen in an effort by the government to wrangle construction costs and halt projects.
The Queensland government announced on Thursday it would end Industry Best Practice Conditions for businesses at new union-approved sites.
The agreement allowed unions to receive an additional $1,000 per week for working outside the home and double pay for working in the rain, among other benefits.
Treasury modeling revealed that BPIC would have cost the state $17.1 billion by 2030.
Queensland Deputy Premier Jarrod Bleijie announced he would put the BPIC deal on “pause and review” for all new government-funded contracts.
“The Liberal National government… is temporarily suspending the CFMEU preferential agreement known as BPIC,” he told reporters.
The suspension will continue until a re-established Queensland Productivity Commission has completed a review of the construction sector.
‘The workers deserve and will be well compensated. “Workers deserve safe workplaces, but productivity must return to construction sites,” Bleijie told a panel discussion at a Queensland Large Contractors Association event in Brisbane on Thursday.
Queensland Deputy Premier Jarrod Bleijjie (pictured Thursday) said Queenslanders should not bear the brunt of cost increases on government projects.
Bleijie and the LNP had set their sights on the CMFEU since winning October’s state election and had questioned the union about huge increases in project costs since taking power.
The LNP claimed to have unearthed losses of $494 million for the Cross River Rail project and $330 million for a stage of the Gold Coast light rail, promising to “stop the rot”.
“We urgently need to rein in the cost increases of government-funded construction projects, which ultimately hit the pockets of Queensland families and businesses,” Mr Bleijie said.
“Queenslanders should not be the worst affected by this, and that is why we have ordered this pause and review.
“It will also give subcontractors, especially small and family-owned businesses and regional companies, a greater opportunity to get work on government projects, without all the costs and time involved in having to obtain unnecessary prequalification.”
Queensland Large Contractors Association chief executive Andrew Chapman blamed the deal for lower productivity and increasing project costs by up to 30 per cent.
The ‘pause and review’ will not apply to government infrastructure work already underway or to enterprise deals already approved.
It will only affect future projects and agreements until a new decision is made on whether the BPIC should continue or undergo modifications.
Queensland’s LNP says “sweet deal” on union-approved construction sites would cost the state $1.71 billion over the next five years (Australian tradition pictured)
The government, however, does not rule out applying the changes retrospectively to eliminate previous agreements.
The BPIC deal faced criticism when it was initiated, but then-premier Steven Miles assured Queenslanders the deal would ensure the projects would go ahead.
“These are all conditions that prevail in the industry,” Miles said at the time.
“I think it’s appropriate that in government jobs workers don’t compete with each other for wages.”
The new government aims to introduce a Queensland Productivity Commission before the end of the year, which would review and suggest amendments to the construction industry in the state.
The LNP cited modeling showing current working conditions could cost Queensland about 22,000 new homes over the next five years, which could see rents rise by seven per cent over the same time.