A sweetheart deal granted to union traditions has been shelved in a government bid to control construction costs and hold up projects.
The Queensland Government announced on Thursday it will end Best Practice Industry Conditions for transactions at new union-approved sites.
This agreement allowed union traditions to receive, among other things, an additional $1,000 per week for working outdoors and double pay for working in the rain.
Treasury modeling shows 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 hold for all new government-funded contracts.
“The Liberal National Government is temporarily suspending the CFMEU deal known as BPIC,” he told reporters.
The suspension will continue until an investigation into the construction industry is completed by a re-established Queensland Productivity Commission.
‘Employees deserve and will be paid well. Workers deserve safe workplaces, but productivity must return to construction sites,” Mr Bleijie told a panel discussion at a Queensland Major Contractors Association event in Brisbane on Thursday.
Queensland Deputy Premier Jarrod Bleijjie (pictured on Thursday) said Queenslanders should not bear the brunt of cost increases on government projects
Mr Bleijie and the LNP had set their sights on the CMFEU since winning October’s state election and had questioned the union over huge project costs since taking power.
The LNP claimed to have unearthed blowouts of $494 million for the Cross River Rail project and $330 million for a light rail stage in the Gold Coast, and vowed to ‘stop the rot’.
“We urgently need to get a handle on cost increases on government-funded construction projects, which ultimately hit the hips of Queensland families and businesses,” Bleijie said.
“Queenslanders should not have to bear the brunt of this, which is why we have ordered this pause and review.
‘It also gives subcontractors, especially small, family-owned and regional companies, a greater chance of securing work on government projects, without all the costs and time associated with unnecessary pre-qualification.’
Andrew Chapman, CEO of the Queensland Major Contractors Association, blamed lower productivity and increased project costs by as much as 30 per cent.
The ‘pause-and-review’ will not apply to government infrastructure jobs already in progress or to enterprise agreements already approved.
It will only affect future projects and agreements until a further decision is made on whether the BPIC should be continued or modified.
The Queensland LNP says the ‘sweetheart deal’ on union-approved construction sites would cost the state $1.71 billion over the next five years (an Australian tradition pictured)
However, the government does not rule out that the changes will be applied retroactively to cancel the previous agreements.
The BPIC deal was criticized when it was initiated, but then-Premier Steven Miles assured Queenslanders the arrangement would ensure projects would be delivered.
“These are all prevailing conditions in the industry,” Mr. Miles said at the time.
“I think it’s appropriate that employees in government jobs not compete with each other on wages.”
The new government wants to introduce a Queensland Productivity Commission before the end of the year, which would assess the state’s construction industry and propose changes.
The LNP cited modeling showing current labor conditions could cost Queensland about 22,000 new homes over the next five years, causing rents to rise by seven per cent over the same period.