Thursday, 16 October 2025

 Richard RIORDAN (Polwarth) (10:57): I rise to begin the opposition’s contributions to the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. This bill that comes to us today is another tranche of bits of legislation that this government has been drip-feeding through the Parliament for quite some time now with a focus on trying to improve the credibility and the management of our very, very important construction and building industry here in Victoria. Within the last few years of course we have had some very notable building company failures that have led to uncertainty and have led to concern, heartache and really dire circumstances for many home owners when the system fails and breaks down. It has an equally devastating impact of course on many, many small builders, subcontractors and others who are the backbone of our very important development, building, construction and housing industry.

The government has a role in this. We do not want a big government that starts telling people how to build houses and how to manage their businesses, but we do need a government that has proper regulation and oversight of what is essentially for the average home owner one of the biggest investments they will ever make in their life. For others, like small business operators, who are running important businesses that put food on the table for their own families and who also provide jobs, opportunities and careers for many others, it is important that the framework around this works correctly.

Earlier in the year the government put to bed its changes with the reformed Building and Plumbing Commission, and the Building and Plumbing Commission will in large part have oversight of many elements of this piece of legislation as well. The Building and Plumbing Commission are essentially the watchdogs of this important industry.

One of the concerns that has been ongoing is that while we are making these changes to help prevent future problems, in many, many cases we have not yet addressed some of the outstanding issues that have come along the way. So unfortunately there are still many who have fallen foul of things that have gone wrong in the building and construction industry, whether they are companies that have failed, builders who have left the industry or surveyors that no longer practice or cannot get future indemnity insurance or for other reasons might not be in existence. The Building and Plumbing Commission have that role, and it is disappointing that again with this latest piece of legislation the government has not really sought to make it clear to the Parliament and to the community the concept of extra resourcing and support for the Building and Plumbing Commission to make sure that they will in fact be able to implement their watchdog status and truly keep a watchful eye on the practices.

This bill does however attend to that ongoing issue of keeping the money flowing. It is an important part of any business ecosystem that the money in and money out all keeps moving in a timely and credible manner. The Building and Plumbing Commission of course will have oversight of ensuring that people within the industry are solvent, are functional and are providing good practice and good industry behaviours. This bill attempts to provide more certainty around payment. It identifies issues such as what good payment times are, and that is identified as essentially 20 business days. Those in the business world say 30 days from end of month is the type of payment cycle that people are used to, and it ensures that is the benchmark. This bill also identifies a quirk of the building industry: the famous Christmas shutdown period. It identifies the fact that in this industry basically it is the time of year when everyone gets caught up on their holidays and very few people in the construction industry are operating their offices or their various departments, and people are often away on holidays. So there is a specific cut-out up until mid-January in order to allow a bit of time out at a time of year when most people would agree it is not reasonable to follow up disputes or payment processes.

There are some practical elements in this bill, but ultimately this legislation exists – as does the Building and Plumbing Commission – to continue developing confidence and security within the industry. This bill is really a response to recommendations from the 2023 parliamentary inquiry into subcontractor protections, and it largely implements many of those recommendations. What some in the industry are curious about is that it identifies the plumbing and surveying professions as two that are specifically singled out for extra regulation and safeguards. The issue has been raised: why is the government acting in a piecemeal manner in just picking two elements out? There are other trades and professions that are equally required to be of good standing and up with their professional standards, so there was a general concern that there are identified shortcomings in those two professions. This bill seeks to create more obligation there, and the feedback from the industry is: why us and not everybody? Why wouldn’t the government do like other jurisdictions have done and identify all the elements of the building and construction profession and treat them all equally? A reasonable concern from the industry is: do we have to now wait for another piece of legislation? Then we get the situation potentially down the track where there will be a dispute and someone has got more regulation than someone else, and we are having a dispute over it until it gets caught up.

It makes sense that the government needs to continue to look more holistically at the building and construction industry, and what this legislation still does not bring Victoria up to speed in management of this is – the constant feedback is – we have to have more ongoing coalface monitoring of the construction industry, not in a way that is bureaucratic and not in a way that interferes with day-to-day operations of legitimate builders and contractors but in a way that identifies where the bulk of the disputes and issues arise and makes sure we have the resources at the Building and Plumbing Commission that will with laser-like focus look at those parts of the industry and monitor it through. With technology today being able to assist the commission in real-time monitoring there really is a huge opportunity here in the state through the ongoing reforms that the government has brought in to actually focus on what causes the problems, put the resources into solving those problems and let the industry get on with running itself and doing what it does best, which is most of the time building high-quality dwellings and constructions that add to all sorts of benefits and outcomes that are very good for the state of Victoria and the people that live here.

The government has had this focus on the building industry. As I said earlier, we have had some pretty big failures and collapses here in Victoria in recent years. We have still literally thousands of home owners left in limbo. They have disputes that have now gone on for two or three years. As opposition shadow in this area I have met with many of these groups, and there is a frustration that we are talking about solving future problems but we have not really put mechanisms or procedures in place to solve past problems. I think that is a fair criticism of the government’s approach and this legislation. It is another opportunity that could have been used to make sure that we have cleared up the heartache and concern from many victims of poor construction practice and poor construction financial management.

Why is that important? It is important because we are in a housing crisis. The housing crisis is now becoming synonymous here in Victoria with this ongoing cost-of-living crisis for so many Victorians. Rentals are more expensive. KPMG tell us that something like 80 per cent of the Victorian population, based on their average incomes, can no longer afford a mortgage for what is now considered the average price of a house in Melbourne. When you have statistics like that, you understand the disadvantage that causes, and the disadvantage is highlighted to us in people’s cost of living. We feel that we just do not have money in our pockets, in our bank accounts at the end of the week to buy other essentials, because we have had to spend it on increased housing costs.

But it also plays out in things like the government’s housing waiting list. This government seems to keep turning its back on the fact that, every reporting period since it has been in, the waiting list for the homeless continues to grow. What the council for homelessness services, social welfare groups, the public housing tenants association and others all report is that more and more people are being added to the homelessness list not for traditional reasons of being cast adrift or down on their luck or unable to find a home; more and more people now just cannot afford the private sector. They cannot afford housing that they once could afford, and they are desperately reaching out to government for more assistance in housing.

It was of great concern this week that the ABS data came out again, warning the Victorian government and Victorians generally, and some of the statistics I will bring to the house’s attention. If we look at private dwelling completions for the last 12 months, they are down 26 per cent. This legislation is about trying to increase confidence in the construction industry. When you hear figures of a 26 per cent drop in private dwelling completions for the last 12 months you go, ‘Wow, there’s a desperate lack of confidence being experienced here in Victoria about the opportunities there.’

The government might want to blame interest rate rises and other things, but historically the more macro economic conditions are not out of the ordinary. In fact we have had two rate cuts in recent times. The industry is clearly saying the cost of production and extra impediments that this government has crept into the construction industry over time, its failure to restore confidence, led to a figure like that.

It is not only private sector dwellings that have had a crash but non-residential developments. That is people prepared to invest in commercial and industrial applications. We need the business community to be reinvesting in its premises, putting its capital, back into new factories, new warehouses and new manufacturing opportunities. They are going south here in Victoria, and the question is: is this legislation doing what it needs to do to deal with that?

There is this worrying trend that sort of ties all that data together, and that is that this government made it really clear a couple of years ago it had set an ambition of 80,000 homes it wants to build a year and we are consistently averaging a 20,000 to 25,000 homes shortfall on that target. It is a massive, missed opportunity in Victoria. The question that this government should be asking itself, and certainly the opposition is asking, is: does this legislation help restore the confidence into the community to make sure that we can bridge this huge shortfall in homes? Quite frankly, I think the answer is no, it does not. It does not do that, and why doesn’t it do that? Because the industry is looking at this and going, ‘Well, there are missed opportunities with this legislation.’ The other side to this argument of course is that the government will say, ‘Oh, but you know, things aren’t so bad in Victoria. We are building lots of homes. We are building the most amount of homes of any of the states.’ Well, yes, I will concede to the government that that is in fact true, that we have in fact built more homes than other states, but we are not building more homes per capita and we are not building more homes relative to the growth of the state.

Probably one of the few things that we all agree on in this wonderfully historic chamber is that Victoria is a great place to live. People like living in Victoria. We have got a great climate. We have lots to offer as a state. Despite all the woes and the efforts this government puts into messing things up from time to time, it is a great place to live, and the rest of the world recognises that. We have great growth in our state, but unfortunately, for every 10 people that come to Victoria, we are only building 3.9 homes. If you look at the long-term trajectory of that, we know that we are missing the targets the government set. We know that every time 10 people come to Victoria, we are only finding 3.9 homes for them. It is a massive shortfall. That shortfall directly leads to increased rents and increased costs, and this legislation and this government still fail to deliver what Victorians will need, not only what they will need but they must have – an opportunity to get more homes more quickly and more affordably. That is a real concern in terms of where we are heading with the legislation around this very, very important topic.

I had the opportunity yesterday to raise an overriding concern around what is driving this government on its housing policies and its policies around trying to reform the industry. I happened to attend a Property Council of Australia forum last week with the head of the government’s thought behind where we house and how we house people. I raised this yesterday in a grievance, and I guess it is important to raise it again here with the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025, because it is the thinking behind the government on the importance of housing. It was discussed last week in this public forum that yes, the government concedes tax is part of the problem in making homes more affordable and more accessible for people.

The government concedes that, and I am glad they do because 43 per cent of the cost of a greenfield site is taxes and charges. It is a pretty significant cost. The government concedes its planning reform. The government has certainly been dishing out plenty of inefficient planning reform, but they are doing something in that space.

But the bit that concerns me and members on this side of the chamber is it is changing cultural attitudes towards housing. What does that mean? From this government’s point of view that means, ‘I hear that a lot of migrants come to Australia chasing the Australian dream of the quarter-acre block. Well, I’m really sorry, but that dream doesn’t really exist anymore. We need to, as a society that includes new Australians, embrace the fact that the way we live has to change and reflect our changing society.’ What concerns me about that attitude in government is this is symbolic that this government has given up on being able to provide accessible and affordable homes to Victorians if they want them and can afford them.

We know that they have given up on a desire to provide more social homes, because despite this government’s constant rhetoric that they are building more social homes, they are renewing social homes – they are not building more social homes. We have seen dramatic drops, despite all the money being spent. We have a net decrease in the amount of available public bedrooms in the state of Victoria, which highlights the fact that this government has not got its eye on the ball. It is looking for lots of photo opportunities with fluoro vests and hard hats. They have got those – ‘Look at us. Look at me. We’ve got a new housing estate open.’ But they do not tell us that they demolished a whole bunch of them to do it and they have not actually got net increases.

In a state that is bringing 10 people in and only housing 3.9 of them, it is glaringly obvious that we have to have a relentless focus on new net increases in housing. That is the challenge that this government has and is failing abysmally at. We have got skyrocketing waiting lists. We have some of the most vulnerable in the state, whether it is families escaping domestic violence or people with acute mental health needs, that really need specialist housing. It does not matter what metric you use. For our Aboriginal and Torres Strait Islander communities – this government spends a lot of time talking about opportunities to do better by those communities – on whatever level you look we are them failing abysmally in the housing part of it.

The opportunity that this government has to sit with industry, to work with industry and to work with people that have access to the capacity to provide more homes – they simply do not do that. In fact this government has been on at least a five- to eight-year campaign against property ownership. We heard it back in 2022 when the then Premier Daniel Andrews made his famous claim that people no longer wanted to aspire to have a home, they were happy to rent – that was his assessment of it. We heard last week, and I have referenced it already today, how the department has given up on that aspiration. They think it is a culturally irrelevant point of view to have in this day and age, yet they still have not got the elements together to make housing more affordable.

If you look at where this government sits now with its housing policy, it is all about finetuning the big end of town. It is about saying that people want to live in apartments. It is really important for those opposite to understand the basic economics of housing. For example, on a greenfield site in rural, regional, outer Melbourne, you are building and providing a home for someone at around $3000 to $5000 a square metre. You can get people into their own home, into a quality home, with that sort of money. The government’s current strategy says we can put 70 per cent of the population into apartments near train stations at a cost of $15,000 a square metre. It is an enormous difference. What they have failed to translate is that $15,000 a square metre plus mind you – $15,000 is very modest – is well in excess of a million dollars for the cost for that accommodation.

The government has missed the bit of common sense that says people can afford a property at up to $800,000, and in rural and regional Victoria you can certainly buy a house and land package for sub-$600,000 – that is affordable for people. Saying to people that the only solution this government is going to offer you into the future is an entry level property with two bedrooms at $1.2 million, $1.3 million, $1.5 million, depending on the suburb, is just unattainable. It is not a solution for the housing crisis here in Victoria. So the opposition this week will not be opposing this legislation, which is relatively benign.

I guess the point we are making is that with so many shortcomings in the construction and housing industry at the moment, to bring this forward, as identified in the minister’s second-reading speech as one of many bits of legislation, my message to the government is: okay, we will let this one pass. It is generally agreed upon by the industry that tightening up payment times and making some changes around the edges in how businesses govern and operate with each other has some merit. But the plea to the government is: what are you going to do to work on that affordability component of housing? This helps restore a bit of confidence to the industry. It does not address the outstanding lack of confidence and the outstanding disasters that have happened because we have not had the resources to manage the governance and oversight of the construction industry. There are still real concerns in here about whether those resources are going to be with the Building and Plumbing Commission to make sure that ongoing loopholes are not taken advantage of.

There is still much as a community and as an industry that the government still has to bring to this Parliament. There is still more to see and there is more the industry and the community expects of this government if it is going to work on helping to put a building ecosystem in place that can produce homes at the rate we need it to fill that big gap between the 10 people a day coming in and the 3.9 that were able to match up to a home. We need to match that gap. We have got to provide something that will see us heading in a trajectory to get to the 80,000 homes. We need to see something that says we are producing more homes. We are seeing an active decline in the 66,000 families and that list that is growing month after month after month. My colleague here the Shadow Minister for Women and I have been working together on the ongoing struggle of that often very desperate cohort of people seeking refuge, housing and others, who are waiting so long for their housing. Not only are they waiting a long, long time, but as we unfortunately experienced in recent times, they can often get the housing and then this government does not have the mechanisms in place to keep people safe in that housing. There are so many elements to what we have to do to fix housing. It is just disappointing that this piece of legislation has come to us this week. It is a lot of paper without a lot of difference that is going to be made in the state.

I will draw to a conclusion my contribution on this bill and invite others of my colleagues to take the opportunity to have their say. But just for the record, the opposition supports anything that is going to actually make a real difference in bringing credibility and economic safety back to the construction industry. We want to see better outcomes for consumers, we want to see better relationships across the spectrum of the construction and development industry, and we need an environment where not only local companies feel comfortable to continue to invest here, but we want to make it so that when people and companies and individuals and investors are looking to come to Australia, come to Victoria, they see us as a first choice, not a last choice.

The constant feedback to me is, ‘Victoria’s a place we want to do business because people want to live here, but we don’t feel confident that we can make that investment, because there’s been a consistent track record of poor performance and there’s been a continual lack of good oversight over the industry.’ Yes, the government has made some changes with the BPC, but we definitely want to see more resources to that agency to make sure that the oversight is genuine, ongoing and long term and leads to the restoration of confidence.

 Nina TAYLOR (Albert Park) (11:25): It was pleasing to hear the opposition say that Victoria is a great place to live. It would have to be a first, I have to say. I have not heard that. They seem to always trash and talk down our state, so it was a bit refreshing. Maybe we have shamed them into it, I do not know, but it was certainly a nice change of pace, at least for a few minutes.

I do want to just pick up on one point before I get to the heart of this issue, because we have been making incremental and significant reforms when it comes to backing in the building and construction industry. I note that it is the cornerstone of Victoria’s economy and community, employing over 325,000 Victorians and supporting key industries every day. I do just want to pick up on a point about how, when we rebuild the 44 towers, there will be no increase in housing. That is simply not true: there has to be a minimum of 10 per cent uplift. I know with Barak Beacon in my electorate there is a 43 per cent uplift, so it is going from 89 homes to 408 homes. It is a mixture of social and affordable and market rental. It is providing a contemporary standard of housing that Victorians deserve, with better passive surveillance, better landscaping and also better heating and cooling in terms of being more climate resilient. There are so many pluses with these rebuilds, so I think that was just an inaccurate statement, respectfully, by the previous member.

Looking at the imperative for these reforms, beyond what I have to say is a very pragmatic element – and that is being paid appropriately for work completed, which is at the heart of this, because cash flow is essential, we know, for any business to survive – we know that certainly the goal here is obviously to keep firms solvent and help them attract and retain skilled tradies, so this bill contains strong new rules for Victoria’s booming construction industry. I will say that, yes, the building and construction industry has had some really significant challenges – there is no question. There have been global pressures, I should add to this discussion, in terms of the cost of getting certain supplies and this, I have to say, is not isolated to Victoria. I am not going to resile from the responsibility that we bear in this state, and that is why we are bringing forward these important reforms. But I note that housing shortages are being felt around the world, whether it is in the UK or whether it is across Europe. To suggest that it is only Victoria and not other states experiencing these challenges is simply untrue.

Coming back to the bill, we know that builders, plumbers, electricians and their subcontractors are the key to achieving the Victorian government’s ambitious housing goals because we know that the answer is to actually increase housing supply, and they need protection to ensure they get paid fairly and promptly for their hard work or the goods and services they provide to a project.

A member interjected.

Nina TAYLOR: Okay, we agree. This is lovely. Yes. Good. Thinking back to the very important 2023 parliamentary inquiry, which highlighted the financial risks facing subcontractors, it showed the harm caused when employers and contractors fail to pay on time, or at all, for completed work. This behaviour has left businesses and families carrying unacceptable burdens, and we do not need to imagine the terrible consequences that can flow from that: mortgages do not get paid, bills do not get paid and then people can be in all sorts of strife. It is devastating for the builders themselves, their families and then of course the other businesses, the subcontractors, that flow on from them as well.

In any case, with that inquiry, the government supported all 28 recommendations, and 15 of them are being implemented through this bill. I think it is important not to understate the significance of the reforms being brought about today. I get that creating and posing conjecture is part of the rough and tumble of Parliament, but fundamentally I think it is important that we reinvigorate confidence in our building and construction sector and show them that we really are here to support them in building Victoria’s future.

The bill strengthens the Building and Construction Industry Security of Payment Act 2002, making it easier for subcontractors to recover what they are owed. It scraps the unfair rules introduced in 2006 that blocked claims, created confusion around timing and allowed last-minute excuses for non-payment. These rules were unique to Victoria and have rightly been criticised as unfair. Other key improvements in the bill will allow more time for disputes to be resolved, because we know, and without casting aspersions – or maybe I will cast some aspersions – if time is the enemy and can be a lever to get out of or avoid an obligation, then that is something that the bill is seeking to overcome, quite rightly. It removes strict deadlines that have unfairly prevented some claims, further to my point. It gives decision-makers the power to invalidate unfair contract terms. It is very pleasing to see this method of rectification, because that is inherently unfair and unreasonable in any scenario, I must say.

The bill will enable contractors to claim withheld security money once their work is complete. I think we can see, again, that that is a very pragmatic and positive reform. It will give the new regulator, the Building and Plumbing Commission (BPC), a role in educating industry about their rights and obligations. On the one hand it will empower those who might not have known how to seek redress in unfair circumstances and on the other hand it will remind those who may have taken advantage unfairly of loopholes or otherwise – things that we are seeking to overcome today – to behave in a manner that is appropriate. Ultimately this will boost confidence among Victorian consumers in the building industry as well.

The bill will make electronic service of documents possible – yes, a big tick to technology when it certainly can assist the efficiency of business. It will also clarify that business days exclude the annual shutdown from 22 December to 10 January. Again, we can see a very pragmatic element to this bill. The opposite of that would be that there could be unfair consequences for those directly involved in the building industry were these nuanced but important changes – these fairness elements – not being implemented through this bill. Make no mistake: these reforms will be a game changer for builders, subcontractors, tradies and consumers, boosting financial security and confidence across the industry.

The bill also strengthens the Building Act 1993 to improve the BPC’s role as regulator. A new code of conduct for plumbers will be introduced, developed with industry. Developed with industry – I just want to emphasise that point. There is a collaborative element to that, from those who know best how the industry works, to lift standards and align with the existing code for building surveyors. The registration system for building surveyors and inspectors will be modernised to both lift standards and grow workforce numbers. Obviously, with a lift in building in our state and with the ambitious but necessary housing targets, we need to boost the workforce numbers. It is pleasing to see that there are levers within this bill to help facilitate that process. This will be achieved through clear competency benchmarks linking education, training and registration and through faster and more flexible registration processes. That has got to be a good thing, because sometimes there is commentary about red tape and other things. It is nice, I think, always to unpack what that looks like, because there are kind of throwaway lines that are very easy to say, but it is much better to actually spell things out, and it is good that that is being done through this bill.

The bill also provides for faster and more flexible registration processes, consistent with national standards under the Australian Building Code Board’s national registration framework. More pathways into registration for skilled professionals and the use of trusted third parties to help with assessments will improve efficiency without lowering standards. In addition, building surveyors will now be required to provide information statements to consumers up-front, ensuring homeowners understand the surveyor’s role and their responsibilities from the outset. Again, we can see this as a fairness element, but it ultimately will help to deliver, I would hope, a better product at the end, greater accountability and really back in our building sector.

 Wayne FARNHAM (Narracan) (11:36): I am happy to rise today on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. The first thing I will say about the building industry is that the subbies are the lifeline of it. It does not matter whether you are a plumber or a chippie, brickie, plasterer, tiler, painter or all the other trades, concreters, et cetera. They are the lifeline of the industry and deserve to be protected. When we are talking about this bill today and we are talking about fairer payments and the security of subcontractors, we have to remember that this industry is a pyramid industry. If people read the committee report that was tabled in this Parliament last year, it goes into that quite in detail. It is a pyramid industry where the money starts at the top and filters its way down. A lot of people misconstrue that the builder is at the top of the food chain – he is not. The person that holds the money is at the top of the food chain when it comes to construction, because the builder is always contracted to someone. Except when they are a speculative builder – when they are doing a spec home or a spec unit development, then they are at the top of the food chain.

I have been on both sides of this – probably everyone gets sick of me saying this – but I have been the subbie and I have been the builder, so I understand both sides of this industry. I understand this industry very well. You have to bear in mind that it is a pyramid industry. There are a few concerns around this area. Sometimes when a builder fails to pay, it is not necessarily his fault. I will give a couple of examples just to go into this. We are introducing a bill today for the security of subcontractors, which is a good thing. But one of the biggest builders in the state is the state government. I was waiting for the cheers – none occurred. One of the biggest builders in the state is the state government.

A member interjected.

Wayne FARNHAM: There we go. I was waiting for it. If we are going to have security for subcontractors, the state government needs to get their act together. I am going to reference the Victorian School Building Authority and the Victorian Health Building Authority. These are two authorities within this government that fail to pay builders on time. I know builders that have been pushed out to 60, 90, 120 days with the VSBA, and I know builders that have been pushed out to 60, 90 days with the VHBA. The government needs to get its house in order when we talk about security of payments, because if I am building a school – it might be a $20 million contract – and I put in a claim for the month of $2 million, under this legislation I have got 30 days, or 20 business days, to pay that contractor, or generally a month. If the VSBA hold that $2 million payment on me for 60 or 90 days and there is nothing wrong with the subcontractor’s work, there is no valid reason for me to deny his payment.

He has done everything right. All the electrical is signed off or all the plumbing is signed off or there is no defect work, but if the VSBA or the VHBA are dragging those payments out, the builder then is breaking the law – but not through his fault, and that is what we have to remember. When we talk about the pyramid of construction, it is the person who is actually writing the cheque that is at the top of that pyramid. So the government really need to look at this in the way they are processing things when it comes to the construction of projects in Victoria, because to set a builder up to fail is not fair. To set a contractor up to fail or to struggle for 60 or 90 days is not fair to the contractor. Builders rely on subcontractors as a credit line in construction. We put them essentially on like a 30-day account, and a lot of builders will not have a spare $2 million of cash in their back pocket. If I am doing a job, if it is a month-by-month claim, I say to the contractor, ‘I need your claim in on the 25th of the month so I can submit my claim to government on the 28th of the month so I can get paid by the end of the next month.’ So if we go by the claims system, I have actually already stretched the contractor out, because it is longer than the 20 business days. When the government fails to pay contractors or when the government fails to pay the builder and the builder fails to pay the contractor, then this bill actually comes into question. So I would actually like to see the government put in some mechanisms where the builders get paid on time. I think that is very, very important, because I am hearing it from builders – not just in my local area; I am hearing it from builders all around the state – that the government is failing.

The government changed the system, and the VSBA – I am going to point to them again, because they are one of the serial offenders in this. We used to have a system that was very simplified where the architect was the superintendent on the project, I would give the claim to the architect, the architect would verify the claim and it would go to the education department, and the education department would pay. It was very simple and actually very streamlined. But now the VSBA have decided that the architect’s word is not good enough, so they get in an independent quantity surveyor to knock that claim down, which then puts that claim into dispute, which then extends the period of payment. That is wrong.

Builders are not out there trying to rip the government off. They are out there to deliver a product whether that be a school, a hospital or whatever. They are there to deliver a product, and they deserve to be paid on time so they can pay the subcontractors on time, because the building industry at the moment is doing it very tough. I am sure every member of this chamber has heard from builders who say we are not doing that well at the moment. When the biggest building company in the state, being the state government, are not honouring their contracts, that will filter down the line to the subcontractors, and the subcontractors, as I said earlier, are the backbone of the industry. Without your plumbers, without your chippies and without your painters, your tilers, your concreters and your brickies, you cannot build. If they end up going into liquidation because of the government’s failure to pay on time, we are losing trades, we are losing builders, we are losing our skilled workforce through non-payment.

There is nothing worse as a subcontractor when you do not get paid. I remember doing a job up in Albury–Wodonga. I was owed $120,000 for four months. I had to use the money I had set aside for my GST to pay the subcontractors so they would pay the little guys. I had to get all of them paid first. The bigger guys – Reece, timber suppliers, Dahlsens – I had to let wait. I thought, ‘They can survive; I’ll let ’em wait.’ All of a sudden, because of a developer who would not pay me for no good reason – I was on stock credit with Reece and stock credit with Dahlsens – I could not get any raw materials for the next job, because I could not pay the last job’s bills.

That is the flow-on effect. That is what the government really has to realise when we are introducing legislation – we have to go to the very top of the pyramid to fix the problem. The builder is not always the top of the pyramid. There is nothing worse than when you come into Christmas and you have got no money in your bank account and you cannot pay your bills – you cannot even buy your kids a Christmas present. People get angry, and I got angry. I did get my payment. I am not going to say how I got my payment, but let us just say there was some very colourful language along the way to the person that owed me the money. I know members on that side who have probably been in a similar position to me. When contractors get put under stress, they will snap, and rightly so. A fair day’s work for a fair day’s pay – that is what we believe in Australia, always have. I love security for subcontractors, but what the government needs to do is lead by example.

 Paul HAMER (Box Hill) (11:46): I also rise to make a contribution on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. Before I get into the substance of the bill, I want to reflect on the contribution made by the member for Polwarth. He was reflecting on the government’s housing strategy and housing targets, particularly the cost of, say, a house and land package in regional Victoria or on the outskirts of Melbourne compared to the cost of an apartment. One thing that was probably missed from that contribution was that not everybody wants a house and land package that is on the outskirts of Melbourne, particularly at different stages of your life.

Melbourne’s demography is changing. Many people are staying as singles or couples for longer periods of time, and they want to stay close to family, friends, where they grew up and the services that they know. They do not currently own a dwelling, and they are looking to move to a dwelling that has that access to services. The cost of buying a home on, say, a larger piece of land further out from Melbourne does come with other costs. It does come with the impact of further travel to jobs, further travel to services and less availability of infrastructure compared to places such as Box Hill and your seat, Deputy Speaker. The approach that the government has been taking in terms of promoting development in the outer-suburban growth areas, regional Victoria and within the existing suburbs is one that it has to take in order to meet the population growth and population demand that we are seeing. This is directly relevant to the bill that we are debating today, because it is about the building industry, the housing construction industry in particular.

I want to acknowledge the contribution from the member for Narracan. I know the member for Morwell will follow my contribution, and I am looking forward to that as well, because as members who worked in that industry before coming into this place, they have intimate knowledge of how that construction system works. As the member for Narracan alluded to, that pyramid structure, that trickle-down payment system, is not just from the principal to the head contractor and head contractor onto the subcontractor, but often the subcontractor themselves have their own subcontractors. A subcontractor may not have all of his or her workers as their own staff, depending on the job. A subcontractor may hire other subcontractors, and then each time that you move down that pyramid, you are getting smaller and smaller businesses and individuals who have a greater reliance on that cashflow to be able to not only sustain their own business but also obviously feed their family, buy presents at Christmas and all of the other things that we would expect them to do.

Most of the legislation changes that are being proposed in this bill come out of recommendations from a parliamentary inquiry. I want to thank the chair of the Environment and Planning Committee, the member for Wendouree, and the co-chair, the member for Morwell, for putting together this inquiry, which really delved into the details of the impact of the fairer payment system and the delay to the payment system, particularly in the construction industry, and how that impacts on those small businesses that are trying to provide a service and help build our state.

This bill makes 15 amendments to the Building and Construction Industry Security of Payment Act 2002. It is designed to improve subcontractors’ ability to recover payments for completed construction works and goods and services supplied to a construction project. The policy intent of the original act has always been to ensure that subcontractors get paid in a fair and timely manner for their work. However, the inquiry found that the act has not been keeping up with industry expectations. There were in total 28 recommendations were made by the inquiry. In response to the inquiry the government accepted 16 of these recommendations in full, with a further 12 recommendations accepted in part or in principle. One of the recommendations which was accepted in full can be enacted without legislative change. The remaining 15 require legislative change, and this bill makes changes to implement all of those 15 recommendations. Of the remaining 12 recommendations that have been accepted in part or in principle, there does need to be more work, particularly around consultation with consumer groups, unions and industry, as to how those changes will come about. But the message is clear coming out of the inquiry, and I was pleased to see that there was no minority report. It was supported by all members of the committee that there are poor practices in the industry which financially impact directly small businesses and subcontractors, and it is important that we as a government address those issues.

Just to go through a number of the details of some of the recommendations in particular, and I am not going to have time and do not want to detail all of the 15, but one of the major recommendations – this was recommendation 2 of the inquiry – was to enable contractors to claim a progress payment calculated in accordance with the contract or, if the contract does not provide for the matter, calculated on the basis of the value of construction work carried out. The current act stops subcontractors from claiming payment for a range of contractual items; this is a unique clause to Victoria, and it is excessively complex for the construction industry to navigate. We want to try and simplify the construction contracts as much as possible to allow, particularly in the domestic building industry, building to continue. We do not want to put these types of barriers in place that will just make it more difficult for builders to continue actually building the dwellings. As I mentioned at the outset, cash flow can be a real challenge for contractors. We cannot just keep on expecting them to work if they do not have that cash flow backup.

So removing that excluded amount scheme to allow more items to be included in payment claims will be an important change.

I also want to note that one of the recommendations, recommendation 4, proposed to amend the definition of ‘business day’ to also exclude the period between 22 December and 10 January. As we all know, everyone is celebrating Christmas and New Year at that time of year; the construction sector in particular will often have a shutdown in that period, so that recommendation makes sense.

I support the 15 recommendations that are being implemented in the bill, and I support the bill to the house.

 Martin CAMERON (Morwell) (11:55): I rise today to talk on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025, and from the outset obviously this is a bill that I have taken great interest in. Obviously number one is being in the trade, but number two is the work that we actually did as a committee to get this here and into the chamber so it can be discussed. I do note there are some other committee members on the other side that are in here today, and it was interesting, as we sat down and worked our way through talking with trades and talking with actual builders about the concerns and the hardships the non-payment of our tradies, and at the end of the day how much grief it causes.

When you do win a contract to work either building houses or on a job site and in particular other pieces – you may win a contract to build a new school, for argument’s sake – there is the thrill of winning those contracts and then getting your workforce together and starting the build. Tradies from every persuasion – they do not have to be builders, plumbers or electricians; it can be the tiler that goes in and tiles a particular dwelling – take great pride in their workmanship, and at the end of the day want to present a product to people that are paying their hard-earned money for us to build a house and to complete that. But on the flip side we need to make sure that when the time comes to be paid, and the payments do come in stages, that they are paid promptly, because as the member for Narracan, now the Acting Speaker sitting in the chair, alluded to before, if you are, for argument’s sake, a builder, and you are subcontracting out your work, well, you have got that responsibility; if there are five people or 10 people that are working for you, you have that responsibility, and it does weigh on you heavily to be able to pay them a wage at the end of each week. You are relying on payments from above to be to be coming constantly, and it does cause a little bit of grief.

The member for Narracan articulated well how when you are not getting paid for the work that you have done, the grief and frustration that it causes. In my time working as a plumber, it was more the norm that you were always chasing money rather than someone saying, ‘Hey, thanks very much for the work you’ve done, here’s an early payment.’ That very rarely happened, so the pressure is on the tradies; the tradies are the ones that carry the weight of the builders. As you know, Acting Speaker, we are the ones that at the end of the day, once the construction, no matter what it is, is finished say it is our product. Many a time when I was driving past with my kids when they were younger in the car I would say, ‘I built that, and I built that.’ Well, I might have put in some toilets and run some water in it, but I took credit for the whole build; that is how passionate we are in the in the trade business and the building business.

Something that we are hoping to fix with this bill coming through is to have those regular payments. But one of the things which were highlighted was that one of the main people slow on the payments, unfortunately, which is an embarrassment probably for everyone sitting in this chamber, was the government itself. We had a lot of government builds, schools and so forth, where the contractors were constantly saying that we as the government sitting here in the chamber were slow in making the payments. If you are building a school, as you know, there is a lot of money that goes into that that is tied up. To refresh ourselves here in the chamber, to make sure that we are being very diligent and forthright and make sure that these payments do go out, it is not only the head contractor that is waiting for the money; it might be 100, 150 or 200 individuals underneath that head contractor who are waiting for their weekly wage to come through.

I know the member for Box Hill said before that you are waiting so you can keep a roof over your family’s head or so you can buy presents for Christmas. It does not stop. You are doing the work and you are always chasing money. If you are only 30 days behind from when you finish your work to when you get paid, it is happy days. But as it goes out at 60 days, 90 days or 120 days, you do not actually stop doing the work. If you are not being paid at the end of 30 days, you do not stop doing the work. You are committed to the next month and committed to the next month. All of a sudden another project starts, and you are told by the builder or the head contractor, ‘If you start this contract here, we’ll make sure you get paid for the one that’s just finished. We’ll make sure that we quicken up that payment to keep you enticed to get going.’ It might not be the whole payment, it might be three-quarters of it, but you are already started on the next project.

We need to make sure through this bill that we are giving certainty to our trades. Some of the changes with the Building and Plumbing Commission, a new area that is going to come in there, we need to make sure that they are fair dinkum and are doing their job, because unfortunately, as you know, there are some rogues out there that do the wrong things in the building industry, which falls back on all of us. Most people do the right thing, so we need to make sure, if there are rules and regulations about what we are building and where we are going, that they are enforced.

I know one of the big issues, Acting Speaker Farnham, that you and I do talk about on quite often is waterproofing in houses and in high-rise buildings, because if it is not done properly our insurance companies take us for a bit of a ride and our premiums all go up. We need to make sure definitely in that area that there are some levers that can be pulled to ensure that waterproofing in our bathrooms and wet areas is done properly so that after two or three years they do not start to leak, which causes grief on the build, especially if it is a high-rise building. The troubles there flow on, and they can be from an outdoor balcony which is in the weather so when it rains it is going to get wet. We need to make sure that is all done perfectly.

But it all comes back to the tradesperson and his family. You put yourself on the line. As I said before, you always seem to be owed money or owing money. With some of the bigger firms – in my area, being a plumber, Reece and Tradelink – and people that were supplying my company with materials, constantly it was a juggling act as to which one you were going to pay. You did always go out to the level before they would cut you off from giving you any more product, and you would pay a little bit off here and a little bit more off there to make sure you could still buy your materials. But that was the consequence from the primary person at the top. We talk about the set-up as being a pyramid, as all the money flows down. That was the offset of waiting for that payment to come.

It sort of takes your own business, the way it runs and what happens out of your own hands, because you are hoping tomorrow might be the day that the payment goes into your bank so you can pay your own people that work for you, and they are relying on you to pay them so they can pay off their home loans and put their kids through school. So it is not just you as the individual; you have other people who are relying on you, and that is one of the big stresses of running and owning your own business – the stress of trying to keep everyone else employed that falls underneath your banner. Of course there is more work to be done, but I think this is a good start to be able to have a committee hearing, come through with recommendations and then see it up here in the chamber, and we need to support our trades as we move forward.

 Luba GRIGOROVITCH (Kororoit) (12:05): Acting Speaker Farnham, it is great to see you in the chair. I have got to say I completely concur with some of the lines that the member for Morwell said about formerly being a tradie and driving past and adding a little bit of mayonnaise onto what he has and has not built. I have got many friends who are builders and tradies, and very proudly so. I think one of my friends has actually single-handedly built the Footscray Hospital. So it is very interesting, and it is great to see so much passion and pride in many of our tradies and the jobs that they do, and they do keep our state moving and they genuinely do do a great job for our state. So a big shout-out to all of our tradies, and thank you.

As we know, more homes mean more opportunities, and that is why the Allan Labor government is setting clear targets to deliver more homes in Victoria over the next 30 years, and that is something that we on this side are incredibly proud of. Victoria is the fastest growing state in the country, and the member for Melton and I hold the fastest growing LGA in the country, being Melton LGA, which –

A member interjected.

Luba GRIGOROVITCH: Yes, it is. It has passed Wyndham. We are having 78 babies per week, and I am told that the Melton local government –

Mathew Hilakari: 120 in Wyndham.

Luba GRIGOROVITCH: Oh, here we go. I am told that the Melton LGA is the fastest growing LGA in the country, something that we are very proud of, but we know how many resources we need there. To add to this, we are delivering 800,000 new homes as a government over the next decade as part of our landmark housing statement – again, something that we on this side of the house are incredibly proud of. Building more homes starts with building well, and that is very important, because we know how much of a stressful period it can be for anybody embarking on such an exciting chapter. If homebuyers are more confident in the lasting quality of a new home, especially an off-the-plan apartment, then they are more likely to buy. There are so many tragic stories of people who have bought apartments and found that they are smaller or bought houses and their water then does not work or their electricity is wired improperly or whatever it might be. So it is so important that from the get-go we get it right.

Building or buying a new home, for many people, is the biggest investment that most of us will ever make in our entire lifetime, and Victorians rightly expect to get exactly what they pay for. Victorians deserve a building regulatory system which gives them the confidence that they need to build, to buy and to rent in their home state. The Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025 builds on the Allan Labor government’s strong track record of nation-leading building reforms to increase confidence in the building industry. Victoria’s hardworking tradies keep our state building industry growing, and the government is fighting to ensure that they get paid both fairly and promptly for their hard work and for the goods and services that they provide to varied construction projects all around the state.

The fairer payments on job sites bill delivers on commitments the government made in its response to the inquiry into employers and contractors who refuse to pay their subcontractors for completed works. This bill makes amendments to the Building and Construction Industry Security of Payment Act 2002 to implement 15 reforms recommended by the inquiry. On that, I want to thank the committee for all of the hard work that went into this inquiry. It will improve subbies’ ability to recover payments for completed construction work and goods and services supplied to a construction project. Not only do these changes ensure that subbies are paid on time and to the full amount which they are owed, but they also make processes clearer for builders and head contractors, the overwhelming majority of whom want to see their tradespeople paid both efficiently and on time, like they rightly should be. Builders and head contractors will benefit from these changes, which will weed out any dodgy operators.

The bill will also amend the Building Act 1993 to authorise development of a plumbing code of conduct to be enforced by Victoria’s new one-stop shop building regulator, the Building and Plumbing Commission (BPC), which was established after the Parliament passed the Building Legislation Amendment (Buyer Protections) Act 2025 in May. This bill also reforms building surveyor and inspector registration schemes to boost workforce supply and maintain Victoria’s high standards for building surveyor works. Several other laws will also be modernised and improved, including via clarifying amendments to the Planning and Environment Act 1987, the Environment Effects Act 1978 and the Heritage Act 2017.

This bill is a game changer for Victorian builders, subcontractors, tradies and consumers and will help to increase financial security and confidence in the building industry. For those watching at home, I am going to talk about the 15 inquiry recommendations because I am sure that you would want the detail. Firstly, they will enable contractors to claim a progress payment calculated in accordance with a contract, or if the contractor does not provide for the matter, calculated on the basis of the value of construction work carried out. Secondly, they will remove the concept of reference dates and insert a statutory entitlement to claim the payment, amend the definition of a business day to exclude the period between 22 December and 10 January and amend a provision stating that notice-based time bar clauses can be declared unfair by an adjudicator if compliance with the clause is not reasonably possible or would be unreasonably onerous.

The bill will also insert a head of power allowing the Building and Construction Industry Security of Payment Regulations 2023 to prohibit unfair construction contractual clauses. It will also extend the time limit for subbies to claim payment from three to six months, giving our hardworking tradies more breathing space to get on top of business administration. It will impose maximum time limits on payment terms of 25 business days after the payment claim has been made. It will also expressly provide for an entitlement to claim retention money and empower an adjudicator to decide whether or how much and when retained money is to be returned. This will obviously keep cases out of court, saving subbies time and money if there is a dispute or some bad faith behaviour.

It will task the BPC, which, as we know, the Liberals tried to block even being established, with ongoing responsibility for promoting and educating the construction sector in relation to Victorian security of payment law. It will prohibit respondents – that is, the employers or the contractors – from moving the goalposts and including reasons in their response to an adjudicator that were not previously included in the payment schedule. It will provide respondents with five business days to provide a payment schedule in response to an adjudication notice. And last, but certainly not least, it will provide that an adjudication determination must be made within 10 business days of receipt of a respondent’s adjudication response and permit parties to extend the determination deadline for up to 20 business days when agreed, so by agreement. It will enable electronic service of notices and other papers and provide that an adjudication certificate may be filed as a judgement for a debt in any court of competent jurisdiction and be enforceable accordingly.

All of these changes amend the Building and Construction Industry Security of Payment Act 2002 to better serve its original purpose, and that is to make payments both fairer and more efficient on job sites and to make sure that we keep growing the Victorian construction industry for both the workers and the employers. It is important to remember that these changes are to protect subbies from bad faith processes. Honest builders and head contractors who do the right thing will benefit from these changes, which will weed out any dodgy operators.

Those opposite have a long track record on this issue, a track record of leaving Victorians on their own when it comes to building reform. When Labor introduced our buyer protections bill, the Liberals even tried to stop it being debated. The Shadow Minister for Housing, the member for Polwarth, who has just walked through the chamber but I think has left, went so far as to claim that dodgy practices on job sites are not really that much of a problem. He claimed that the industry was doing a good job of weeding out these dodgy operators by itself. He said:

… the industry also needs to have protection from malicious or vexatious customers who at times might play the system in order to get their own way.

Those opposite need to make up their minds and show their true colours.

Which is it? Should we be protecting consumers and workers in this state or are they still standing on the side of dodgy operators? Do they actually believe that the problem with the building industry is consumers who are overstating their pain and suffering?

Labor is getting on with building more homes for Victorians who need them. Reforms like those in the proposed bill will make sure that we keep delivering the high-quality homes that Victorians deserve and need, and that is why the Allan Labor government will continue on with this bill. I hope that we have the support of the entire house, and I am very pleased to commend this bill.

 David SOUTHWICK (Caulfield) (12:15): It is a pleasure to rise on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. Don’t you love the government in the way they get themselves a headline? Everything is about ‘fairer’ and ‘better’ and doing wonderful things until you actually get into the detail, because we do know the devil is in the detail. What we do know is, particularly when it comes to builders and small builders and small business, nothing is fairer. That is my concern, because this government came out with another headline saying they were going to build 80,000 homes a year, and everybody said, ‘Wow, we’re going to get 80,000 homes a year.’ Many of my constituents in Caulfield are saying, ‘We’re desperate for a home. We’re desperate to finally be able to save up money to own a home one day’ – even though the former Premier said we have given up on home ownership and no-one wants to own a home. We know that is wrong. We know that is categorically wrong. If you give a young person a chance to own their own home, of course they are going to own their own home.

What happened to the 80,000 homes a year? The government then had a look at the detail, at the headline, and they realised, ‘We’ve mucked this one up. No way are we going to get 80,000 homes a year.’ So they went to 800,000 homes over 10 years. And why did they do that? Because they know – thankfully, and most Victorians would say thank God – that this mob will not be around for another 10 years, so no-one is going to hold them to account. ‘We’ll just blow a number out there: 800,000 homes over 10 years. No-one will ever know.’ Well, we know, because how many are they at now after two years? They are 46,000 homes short because the devil, my friends, is in the detail. This government lacks detail – all they thirst for is a headline. They cut a ribbon, say how wonderful they are or put on a hard hat. The thing about this is nothing is fairer when small businesses are going under because they cannot actually run their businesses and they get no support from this government.

We know in building a house that 43 per cent of it is taxation, so no wonder it is more expensive to build a home. We know with this government that whatever permits are being granted are just permits. They are not houses, they are just permits. We have heard other members make that contribution as well, saying, ‘You can’t live in a permit.’ Absolutely you cannot live in a permit, you need to build a house. And who builds a house? It is a bit like farmers. You do not get the milk out of the supermarket. It has got to come from somewhere. You know that, Acting Speaker Farnham, because you have been a builder. You know what it is like for people that are skilled tradespeople. I am not talking about the big companies, I am talking about the small businesses: the chippie, the tradie, the electrician, the plumber. They all work, many of them as contractors, and hopefully they get a government contract and hopefully when they get the government contract they actually get paid. Because the hardest thing about small business – and I do not expect the Labor government to know any of this – is actually managing the books and getting paid. You are busy doing the work and you are also busy trying to get the next job, and in the meantime you have got to get paid. A builder would know that quite often they cannot buy the materials for the next job until they have been paid for the last job. And who are the worst payers in the world? Quiz.

A member: The government.

David SOUTHWICK: The government are the worst in the world to get paid by. They string you along. I know we are broke – I know we are paying over $20 million a day just in interest to meet the debt, which has almost blown out to $200 billion – so is it any wonder we have got a government that puts small business on the drip-feed?

They put them on the drip feed and they say, ‘Don’t worry about yourself. Even though you’re feeding families that are working for you, don’t worry about yourself. You can just take care of yourself.’ Well, that is not fair. That is not fairer payments on job sites, like what this bill is called. There is nothing fair about that. So we do need to make sure the first people paid are actually small businesses, so they can pay their employees and so they can buy more materials and hopefully contribute, as great Victorians have in the past, to making our state great again – because we are not in that spot right now. We are the worst at everything.

One of the things I would love to be able to see is more keys in doors. I would love to be able to see more homes built. Wouldn’t we? We have got backbenchers who would love to see it as well. But we all know that you just cannot do it in a headline; it has got to be in the detail. I remind the government that when I looked at some of the figures for small businesses and the high insolvency rates of small builders in Victoria, we have seen a 75 per cent increase in construction company failures, which have surged over a year. We have seen many of the bigger home builders like Montego Homes and like Porter Davis go broke under this government. They are big brands, but who works for those big brands? It is small businesses that contract, that will not get paid or do not get paid. We must never forget that when a government mismanages the system it flows on to those right on the front line. We are seeing shortages of skilled trade materials. We know that from the Big Build, because all the materials have been zapped out for the government’s major contracts into the Big Build, and you cannot get materials for homes. If you do get them, you are paying twice the price.

The final bit that I want to talk about – and I know the Australian Chamber of Commerce and Industry has also said this – is that we have seen 32,000 businesses close or shift interstate in one quarter, from September 2024. A quarter of businesses either closed or moved interstate in the September 2024 quarter. Does that say that business is thriving in Victoria? I would not think so.

The last thing I want to talk about in this contribution today is the CFMEU, because this government has allowed the CFMEU to breed on construction sites. We know that there are many small businesses that would like to contract into the government’s projects but who will not get a look in. And why won’t they get a look in? Because they are not part of the CFMEU outfit. They have been locked out – including even Indigenous labour hire firms, believe it or not. We have been talking about treaty, but we cannot get Indigenous labour hire firms employed on government worksites. That is what I mean about the devil in the detail, because the government is all about the headline, not about the detail. If this government was fair dinkum about treaty, what about getting Indigenous labour hire firms on the Big Build? What about that? Do you think that would make a difference to Indigenous communities that are struggling for trades? If the government were serious, they would ensure that Indigenous labour hire firms were employed on Big Build sites. 60 Minutes has exposed that those Indigenous labour hire firms have been booted from government worksites because they are not part of the CFMEU. That is why this government is not fair dinkum.

We can stand here all we like talking about fairer payments on job sites, but how about making the job sites fair? How about taking out the corruption? How about showing some transparency? Because that is the only time you will build homes more affordably and give small businesses a look-in and ultimately change the game from being the highest taxing state – the state where we are seeing people leaving because they do not have confidence in it. We have got to get it back. We need the confidence for people to come out and we need to roll out the red carpet to small business and say, ‘Come here, invest here, work here and contribute to making Victoria the place it used to be.’ And we need to change the tax system – whether it is land tax or whether it is stamp duty – to ensure that rather than 43 per cent of the cost of building a home going to tax, we actually reduce that so it is more affordable for all Victorians to buy a home.

 John MULLAHY (Glen Waverley) (12:25): It is an honour to rise in support of the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. This bill is about one thing above all else, and that is fairness – fairness for every bricklayer, carpenter, concreter, sparkie, plumber and plasterer who gets up before dawn and drives to site and does the work that quite literally builds Victoria. This bill is about stopping a disgrace that has gone on for far too long: the deliberate refusal by some contractors and companies to pay subcontractors for the work that they have already done. I know, Acting Speaker Farnham, that we have had many conversations about these exact experiences, and I would like to acknowledge your contribution earlier and also the member for Morwell. I will take the contributions of people who have actually lifted a tool in their life as opposed to others.

Non-payment is theft, and that is plain and simple. It is not a cash flow issue, it is not a commercial dispute; it is stealing. It is taking the sweat of the worker or the small family business and converting it into profit for someone else. For too long these practices have been written off as just part of the game. But when the game is rigged, when the rules allow bullies to squeeze the life out of small businesses, then the Parliament has a duty to step in, and this bill does just that – it rewrites the rules of the game.

I know this issue not as a politician but as someone who grew up in it. My parents migrated from Ireland for a better life and started a small family construction business in Geelong. As a young man for 10 years I worked on sites as a chippie, building formwork, pouring concrete and building structural steel, roads, bridges, schools and commercial apartments, and I watched how easily honest families can be ripped off by operators who make fortunes off the backs of others. One of them is Frank Nadinic, a con man who left devastation across Victoria. He would pay the first invoice when you had done about 20 per cent of the contract, and then he would hold back the rest of the moneys – he would get up to 80 per cent. He had clauses in his contract that if you stopped working, you basically broke the contract, and he would never pay you. He destroyed hundreds of small businesses and families across this state. He is a disgrace not only to the construction industry but to humanity.

That experience and many others, including the experience of thousands of others like it, is why this bill is so important. Victoria’s construction industry contributes 12 per cent of gross state product and employs one in 10 Victorians, but it has also been plagued by decades of deeply unfair payment culture, a system where financial risk is shoved down the contracting chain until it lands on the smallest players, the people who are least able to absorb it – as the member for Narracan so eloquently put it, the pyramid nature of this industry. Inquiries have shown that subcontractors complete more than 80 per cent of all construction work, the highest proportion in the world, yet they carry all the financial risk. That is obscene. These are the people mortgaging their homes to pay wages while multimillion-dollar developers delay invoices to pad their cash flow. This bill finally says ‘enough’.

The Environment and Planning Committee found what so many already knew: that non-payment is systematic and devastating. It is not just a few bad apples, it is a culture of corporate bullying, of bosses and head contractors who exploit every loophole. The committee heard stories of small family firms going bankrupt waiting for payments that never came, tradies losing their homes, marriages collapsing and children seeing their parents’ pride broken because someone higher up the chain decided not to pay. I thank the committee for their important work hearing that evidence of the pain and devastation experienced by Victorians working on building sites in this state, and I thank the Minister for Housing and Building for acting so quickly to ensure this problem is snuffed out.

This bill is the government’s answer to that report. It delivers a tranche of reforms, the fairer payment reforms, to make sure that every person who does work gets paid for it. This bill reforms the Building and Construction Industry Security of Payment Act 2002 to make it faster, fairer and tougher on those who exploit others, including these changes. Contractors and subcontractors will now have a clear right to claim progress payments at least once a month. No company can hide behind reference dates or confusing legalese. Strict payment deadlines: payment terms will be capped at 20 business days with a default of 10 days, so if you do not pay on time, you are in breach – no excuse.

Performance securities: the bill creates a right to claim the release of performance securities, retentions, bonds and guarantees so companies cannot sit on subcontractors’ money indefinitely. Fair adjudication: adjudicators will have more time and clearer powers to make fair decisions. Dodgy builders will no longer be able to raise new excuses after the fact to avoid paying. Unfair contract terms outlawed: adjudicators can now declare notice-based time bar clauses unfair that make compliance impossible. And simpler enforcement: unpaid determinations can be enforced directly as judgement debts – fast, streamlined and effective. These are not technical tweaks. They are a fundamental shift in power back to the people who do the work and build our state.

The worst offenders are not mum-and-dad builders. They are the large developers, the multinationals and the tier-one contractors who use their scale to suffocate small business. They hide behind subsidiaries, change company names and move assets offshore while small operators are left holding the bag. These are companies that roll out slick advertising campaigns about partnership and community while destroying communities through unpaid bills and bankruptcy. It is hypocrisy of the highest order, and it all stops here.

Behind every unpaid invoice is a story – a plumber who cannot pay apprentices before Christmas, a concreter who sells his ute to cover wages, a small business owner who shuts down after 30 years because someone has starved them of cash – and we cannot allow that to continue. We talk about mental health in the construction industry, and rightly so, but financial abuse is mental abuse. It crushes people. It robs them of dignity, stability and hope. This bill will not just change contracts, it will change lives.

Laws mean nothing if they are not enforced. That is why this bill strengthens the power of the Building and Plumbing Commission, formerly the Victorian Building Authority, to educate, regulate and hold offenders to account. The commission will now be required to take on an educational role, publishing guidance and training manuals and promoting the law across the industry.

But more than education, this bill gives teeth to the regulator. Dodgy operators will be investigated, sanctioned and, where necessary, stripped of the right to operate. Those who systematically fail to pay their subcontractors should never again be entrusted with public moneys. If you want a government contract in Victoria, pay your people first.

This bill is part of a broader cultural shift, a statement that Victoria will not tolerate wage theft or payment theft in any form. We have already led the nation in criminalising wage theft. Now we are leading again in protecting subcontractors and small business owners. Let me be clear, fair payment is not anti business; it is pro integrity, pro productivity and pro justice. A construction industry built on honesty is good for everyone – for workers, for consumers and for the economy. Where subcontractors are paid on time, projects run smoother, families thrive and local economies grow.

The Allan Labor government committed to this reform after the 2023 parliamentary inquiry, which found chronic, persistent abuse of subcontractors across the sector. We promised to act, and we are acting. The fairer payments on jobsites bill is more than a technical reform, it is a moral stand that tells every worker, every subcontractor and every family business, ‘We see you, we value you and we have your back.’ And to the cowboys who refuse to pay, the free ride is over. To the companies that think they are too big to be held accountable: think again. And to the hardworking Victorians who have been ripped off, cheated and left behind, help is finally here. When the history books look back on this Parliament, let them say that we stood with people who build Victoria, that we ended an injustice generations old and that we made the industry fairer, safer and stronger for all.

Now, on indulgence, I would like to just take a moment to thank my father, a man of integrity, a man who would never take a step backwards when someone tried to rip him off. He is a man of principle who believed that if he and his workers had done the job, they deserved to be paid for it, and he made sure he had the receipts to prove it. Time and again when one of the unscrupulous operators tried to take advantage, he did everything he could to protect our family and the people who worked alongside him. It did not mean that we were immune to it, but I am proud of the fight that he always showed in an unfair system. And I am proud today that we are taking action to fix these issues. But I know, as every honest builder and subcontractor knows, that we will have to remain steadfast as a Parliament, because as we change the rules, the dodgy operators will look for new ways to dodge them. So as a government we must keep our eyes open and our resolve strong. We will continue to protect the working men and women of Victoria, to stand up for them, to back them in and to ensure that they do not again bear the pain and cost inflicted by these crooks who call themselves businessmen.

I commend the bill to the house.

 Peter WALSH (Murray Plains) (12:35): I rise to make my contribution on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. As everyone has already said, this is about strengthening the Building and Construction Industry Security of Payment Act 2002 to make sure that people get paid. I suppose, Acting Speaker Farnham, it needs to be done, no argument, but it is sad that it has to be done – that people’s word is not their bond. I am sure you found in your life in business before you came into Parliament that tragically a lot of people do not mean what they say, and they think they can take people down. Once a handshake meant something, but again, it does not seem to mean what it used to so much in business now. So there is a need for legislative rules that make sure that people are paid and people are treated fairly.

I think this bill is the government’s response to some recommendations from the 2023 parliamentary inquiry into subcontractors’ protection, so for those cynics out there in voter land that say the Parliament does not achieve anything, that parliamentary committees do not do anything and why would you bother putting submissions in, I think this bill here and the fact that you have got agreement from both sides of the house is a very clear demonstration that the parliamentary process does work well when the right issues are brought forward to be dealt with by the Parliament. We have had people that would have given evidence to that inquiry, because as we all know, a parliamentary committee cannot make recommendations to government unless it comes out of the evidence that goes before that committee. So people would have made submissions to that committee that led to those nine recommendations and 28 findings that were presented to government, and government is now starting to respond to those. And in the slow inertia of governments and bureaucracy, this is a fairly quick turnaround to make some changes, which is good to see. So all strength to those people that made the effort to submit to that inquiry and to the members of the inquiry actually making the recommendations that are now here before us in legislation, because it is so important that people do get paid. It is those that are at the lowest part of the food chain or in this case the building chain that suffer the most, and it is the ones with the sharpest lawyers and the smartest crooks at the top of the food chain that take advantage of those people, and they see themselves being left out. We have heard personal examples from people who understand this a lot more than I do, but it is devastating for someone just to have one contractor or one builder that defaults on a payment, as it can actually bring down a business and destroy a family’s future. So it is important in that particular sense.

I suppose no discussion about the building industry would be complete in this place without raising the issue of housing and the fact that one of the biggest impediments to all those in the building system is government red tape, green tape and black tape. Even the subcontractors having to do paperwork, having to wait for their contractor to get the permissions through to do work, is a cost to that particular business. The cost of holding land, of holding materials and of not being able to go onto that job because you have got to go somewhere else because the paperwork has not been done is a cost that is built into the whole system as well.

One of the things I would like to see is that we could actually reignite the great Australian dream of home ownership. There are so many younger people now who are literally despairing that they do not ever believe they will be able to get onto that ladder of home ownership, and they are going to be stuck as renters for the rest of their life. As research shows, if you go into retirement as a renter compared to going into retirement as owning your own home it has a major impact on the quality of your retirement and the financial situation you have as you get older. So yes, this is great; this helps those contractors get paid. But let us actually think a bit bigger and think about how we reignite that dream of home ownership in this state. Because as others have already said, the Housing Industry Association has said that more than 40 per cent of the cost of a house and land package now is government charges and taxes. I do not think people realise that when they are saving up for a deposit, which is a challenge for them in today’s climate, 40 per cent of that money they are going to pay for what they buy is actually state government taxes and charges.

That, to me, is just wrong. We should not be effectively taxing our younger generation out of the property market in this state, which is what is happening at this time. If we talk about some of the worst payers and some of the recidivists when it comes to not paying people, it is government. The government is one of the worst at not paying people. We have had legislation before this place that says the government will guarantee they will pay their bills within X number of days. I would be interested to read the statistics as to what percentage of that target is met by government, because you will find that people on projects in regional Victoria have real battles to get the money to trickle down from government through the head contractor to them as the subbies doing that work in our country towns.

The other thing that would assist in this whole program would be if the rules of tendering for government projects, particularly in the regions, could be changed, where the qualifying level to become registered to tender for government projects was made simpler. A lot of country builders, as you probably know yourself personally, Acting Speaker Farnham, are excluded from bidding for projects in their towns – whether it be a school upgrade, a hospital upgrade or other government work – because they do not meet the threshold of having enough turnover in their business to qualify to do that, so someone in Melbourne tenders for the business. They are never going to go there with their workers. You are not going to see them all that often – they are going to use the local builders as subbies, who could have been the builder and kept all that work and all that money in the town rather than being subbies for those projects.

I often hear builders in the communities that I represent who are very frustrated with the fact that when there is a great announcement about an upgrade to the hospital or a school project, they are excluded from bidding for that work because they do not meet the qualifications and the threshold of having enough turnover in their business or having done enough projects of a certain size to qualify to do that work. They potentially end up as subbies, so they do not make as much money out of it, the community does not benefit as much as it could and some of the work is let to businesses outside the town.

It is different standing here talking about a bill that we are all in agreement with. Having been here for quite a few years, I am a great believer in the Westminster system of government and the fact that some collegiality across the chamber can achieve good things for people. This bill will make sure that people do get paid better. As I understand it, there is still some more legislation to come for some of those recommendations and findings out of that parliamentary inquiry, but I would hope it would come sooner rather than later, because if you think about what drives our economy, whether it is the Big Build projects here in Melbourne or whether it is building a house in country Victoria, the building sector is a major driver of our economy. We need to make sure it is working as efficiently as possible because dollars are scarce. Whether it be government – some contributors already talked about government debt – or whether it be private enterprise, we all have to be very, very careful and get the best value out of our dollars. If this helps that happen, that can only be better for Victoria.

 John LISTER (Werribee) (12:43): Before I begin talking about the details of the bill, I would like to echo the sentiment of the member for Murray Plains on the nature of this debate being quite collegial. It is good to see that there is that support for this legislation, something that is part of a whole series of reforms that we have seen to building and construction that have been brought through by the government. There have been a lot of really positive contributions from the parliamentary committee inquiry and those members as well.

Our construction industry here is booming from our transformative infrastructure projects – which I know in my community we are definitely the beneficiaries of – and the building of homes for Victorians who are choosing to move particularly to growth suburbs like that I represent. This sector is the cornerstone of our economy and community. Over 325,000 Victorians are employed through this construction industry, whether as builders, plumbers, electricians or subcontractors of all sorts of other trades. A substantial chunk of this cohort live in my electorate of Werribee and the wider western suburbs. In fact I think after healthcare and childcare, it is one of the biggest employers of people in the Wyndham area according to ABS statistics.

Tradies are not only building Victoria, they are also keeping our state running. But for far too long the building industry has been subject to poor payment practices and unfair contracting behaviours. It has left subbies, small businesses and workers exposed to unacceptable financial risk. As someone who has many friends in the industry – although it has been a while since I was on the tools, I was just a labourer when I was 16 or 17, but it has been quite a while since – I have heard too many stories about tradespeople working on a job, waiting months to get paid for their work. And it is not just these personal anecdotes that I have heard that back this up. The inquiry that was referenced by the member for Murray Plains and other people in this house highlighted those financial risks subcontractors face by examining that impact of builders and contractors refusing to promptly or fully pay their subcontractors for that completed work.

It is important to remember that these practices affect real people and real families, something that my colleagues on this side have also raised in their quite impassioned contributions. In that inquiry – I went through it, and I quite like talking about committee reports in this place, it is one of my favourite times of the week. I had a bit of a read-through, and while I will not break any kind of procedure here, I do want to reflect on the committee report just a little bit, if I may, particularly some of the quotes from those people who contributed to that report. We have heard a lot about small business from those opposite – it is good to see that there is still a bit of a champion of the small-l liberalism in that side; it is still there, it still exists. It is 81 years of the Liberal Party coming up, or something like that, and I am sure there will be someone in that past who is a little bit happier that they still care about this same aspect of liberalism. But Bruce Code, who was a contributor to that inquiry, said that as a small business owner who has missed payments, he supports mandating and enforcing the payment of fees to subcontractors for completed works. An older resident told someone who contributed to the inquiry of how they had lost their business due to delayed payment. What made this story all the more disturbing was that, like many tradies running their own businesses, the business was financially secured against the person’s property, which they also lost. So it is clear to see that this, as my learned colleague mentioned earlier, not only affects the people who are doing the job and are on the tools, it affects the people around them, and it could affect, ultimately, their own shelter. I think it is pretty despicable that anyone who is doing this work to build homes for people should have to risk their own home.

Also reading through in the inquiry, the Master Plumbers’ and Mechanical Services Association of Australia noted that the plumbers and gasfitters who generally work as subcontractors in the construction industry are down that project chain, which is something I think the member of Murray Plains also reflected on. Yet like any other Australian business, they need a cash flow to maintain those operations and are entitled to get paid appropriately in a timely fashion for the work they do. This is something that this legislation goes to, around not only tightening up those provisions to make sure that subcontractors are paid, but also the work that we are doing to bring the plumbing industry into the regulation environment that we have.

The sort of behaviour that we have seen in the past is unacceptable in every other workplace in Victoria. There are countless articles about it happening in retail, happening in health care and, in some cases, happening in some of our private education settings, and it should be unacceptable in the building and construction field as well. That is why our government has introduced this legislation. The bill delivers on our government’s commitments made in response to this inquiry that I was just referring to. It makes 15 amendments to the Building and Construction Industry Security of Payment Act of 2002 – that is a long one – to improve subcontractors’ ability to recover payments for completed construction work. It removes rules introduced in 2006 that made it harder for subcontractors to resolve payment disputes. The rules blocked certain costs from being claimed, made it difficult to know when to make a claim, and allowed new excuses for non-payment to be raised at the last minute. These rules were – I like to think that there are a lot of good things that are uniquely Victorian, but these rules in particular were uniquely to our context. If it is not consistent with the rest of the country, and we have seen a lot of work come out of the recent Productivity Commission review and the roundtable around productivity, we need to make sure that we do have that consistency between jurisdictions.

It is important that we scrap these rules.

Victorians are overwhelmingly good and fair people, and they want to do the right thing by their fellow workers. The changes made in this bill will make processes clearer for builders and head contractors, the majority of whom want to see their tradies paid as efficiently as possible. The bill will also amend the Building Act 1993 to authorise the development of a plumbing code of conduct – this is where the plumbers come in – to be enforced by the new one-stop shop building regulator, the Building and Plumbing Commission, which we spoke about in this house earlier in the year as we set that up. It also reforms building surveyor and inspector registration schemes to boost workforce supply and maintain high standards for building surveyor work – I have seen this firsthand recently, having put on a building surveyor. It is important for building surveyors to have that ability to pick up a job if it has been dropped by someone else. It is really important to have that mechanism and tighten that up as much as we can, because it means that people who are trying to get into their homes and make sure that they are livable and meet standards will not have any kind of troubles down the road. It is really important to have that consistency.

There will be other laws through this bill that will be modernised and improved, with clarifying amendments to the Planning and Environment Act 1987, the Environment Effects Act 1978 and the Heritage Act 2017. The construction sector is the backbone of our economy and many communities, including mine. There have been concerns raised by those opposite around the state of home construction. We have heard from some people on this side and seen some data showing that in the year to date to June 2025 – this comes from the Master Builders Association – one-third of all homes built in Australia were built by Victorian builders. Unit approvals are the highest they have been per capita, as per the ABS. But we know more needs to be done.

Those opposite have also raised issues about the proportion of taxes and charges that come into housing and the development of homes. There may be some space to look at this, but I do want to point out that some of those taxes and charges that are coming out of these processes go towards building the services that we need in our new communities – things like the growth areas infrastructure contributions and the development contributions. The revenue goes back into the essential services that we need in our growing communities. These contributions are not just floating into the ether. They are being paid back into communities like mine and have a direct consequence for people who are moving into these homes. They are important. It means that we can run that bus and it means that we can build that school.

The government is taking action. It is not just about fairness, it is about doing what is right. I want to echo the sentiment of the Victorian Trades Hall Council who in their recent media release stated:

This Bill sends a clear message to anyone in the building industry who refuses to pay subcontracted tradies … workers must be paid for their work on time and to the full agreed amount. Workers in the building industry will be protected by the reforms …

To those unionists and activists who have championed these reforms, thank you. On this side of the chamber we are on the side of working Victorians, and I appreciate that there is bipartisanship when it comes to this particular issue. We will keep fighting for everyday working Victorians, particularly those people who work in the construction industry in my electorate. I commend this bill to the house.

 John PESUTTO (Hawthorn) (12:53): I rise to speak on the Building Legislation Amendment (Fairer Payments on Jobsites and Other Matters) Bill 2025. Following on from the member for Werribee in terms of the bipartisanship of which he speaks, I think we have to be realistic about what that relates to. The technical changes in the bill, maybe, but the remark that the Allan Labor government is on the side of working people is utter nonsense. Let me start with two words you might remember: Marda Dandhi. Do you remember Marda Dandhi? Look at all the quizzical faces over there. Marda Dandhi – in all of the weeks to raise this – was the Indigenous firm that was working on one of Victoria’s major projects. And do you know what happened? Your government enabled it to be booted off. That is just a small part of a much bigger tragedy that happened with that case, because as we know, there was a tragic loss of life as a result of intimidation and bullying.

When you say you are on the side of working people, let all Victorians know and hear that clearly you are not. When it really counts, you are not. There are many subbies, many contractors and many small businesses who do the right thing, who want to contribute to major projects in this state, but you, the Allan Labor government, will not let them. You will not let them.

The ACTING SPEAKER (Wayne Farnham): Member for Hawthorn, I will ask you to refrain from using ‘you’. It is a reflection on the Chair.

John PESUTTO: Thank you, Acting Speaker, I am always indebted to you for your interventions from the chair.

If this government wanted to live up to its claim that it supports working Victorians, it should make sure it cleans up the rot, the intimidation and the blackmail that occurs on Victoria’s major projects. Remember, at this point in time we have got close to $250 billion worth of major projects underway, at different stages, in this state. That is a lot of jobs, that is a lot of investment and that is a lot of apprentices and trainees, but many of them cannot get a look in. I have friends who run small businesses as subcontractors. They cannot get a look in, and they are victims of the intimidation and bullying that, frankly, the CFMEU is continuing to get away with because this government does not protect subcontractors and contractors in building and construction. That is the first thing.

The member for Werribee on behalf of his colleagues says this government supports working people. Well, how can that stand up to scrutiny when we know that this government delays paying businesses that do work for it, whether it is construction, whether it is IT or whether it is in any other sector of the Victorian economy in which this government is active – they delay. In fact earlier this year this government was so incompetent, so utterly hopeless and chaotic they actually asked builders to delay submitting invoices because they could not pay them. Or if they can pay them, they cannot pay them on time. So on the second basis this government fails its own test of not standing up for working Victorians.

We know also that this government has failed its basic duty of oversight. We know that from about 2023 Porter Davis and many other residential building firms went under. Now, we know why they went under, in large part. We do not know all the details, but we know generally it is a very vulnerable position for many building firms to be able to manage the cash flow. You know that better than ever, Acting Speaker Farnham. You and the member for Morwell are very experienced in this field, and you know how hard it is to be able to manage staff, to be able to manage cash flow, your suppliers and your creditors. It is an exceptionally difficult task, a highwire act.

This government was so oblivious to that, that whether it was the then Victorian Building Authority or the Victorian Managed Insurance Authority, each of which have a statutory charter to oversee the market, to actually identify risks, address risks and manage them down so that ultimately builders do not suffer, or their employees, but also consumers do not suffer either. Yet this government, despite being warned by its own Department of Treasury and Finance more than a year earlier, did nothing about it. And what happened? Builders went under and subbies did not get paid. They went under as well. They were not the only victims. We know that many homebuyers, many who came in here, suffered as well and lost their deposits and lost their dreams. So when this government says it stands up for working Victorians, on a third basis it has failed. It has not done its job as a government overseeing the sector to minimise and manage risk.

That is the broad backdrop. That does not mean that as an opposition we will be opposing this bill. And of course, as has been said by my colleagues, we will not be opposing this bill. Anything that we can do in relation to the regime that governs security of payments, that can ensure that subcontractors and contractors can submit their invoices and get paid in a timely way so they can manage their legal obligations to their staff and their suppliers and their creditors, that, too, is an important thing.

The ACTING SPEAKER (Wayne Farnham): At this point in time, member for Hawthorn, I ask you to resume your seat and we will be pausing for lunch – enjoy.

Sitting suspended 1:00 pm until 2:02 pm.

Business interrupted under standing orders.