Construction industry in deep crisis, says union

The Opal Tower in Olympic Park is one of a number of apartment blocks found to have dangerous building defects.

The Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) has issued a scathing report on the state of the apartment construction industry suggesting it has reached crisis point.

The crisis is set to “cost a staggering $6.2 billion”, according to CFMMEU Construction and General Division national secretary Dave Noonan, and homeowners will most likely have to foot the majority of the bill “to fix apartments they've already paid for”.

Shaky Foundations: The National Construction Crisis was compiled by Equity Economics and released on August 19. It comes in the wake of a number of high profile scandals involving residents having to vacate newly constructed apartment buildings because of serious building defects in Sydney.

Speaking about the costs owners could face, Noonan said: "This includes the cost of remediating water leaks, fire safety breaches, structural failure, combustible cladding, and costs associated with increased insurance premiums, legal fees and alternative accommodation."

"In some cases, the costs of this remediation has been up to $165,000 per dwelling."

"Tens of thousands of families, many of whom have purchased their first home, are now stuck with the crippling cost and mental anguish of owning homes that they may not be able to live in, are unsafe and cannot afford to repair."

The report notes that the cause of the crisis is government failure to adequately enforce building standards or ensure they keep pace with evolving building practices.

The report also singled out the loss of public sector skills and capability, leading to poor project scoping and design, and the outsourcing of building approvals, which has resulted in increased conflicts of interest and lack of oversight.

"There is a path out of this mess,” the report states and that is to act swiftly and decisively to restore confidence in Australia's construction sector.

The CFMMEU is calling for the application of "the strictest standards practical to new builds so as to remove doubt as to their quality" and the introduction of "maximum transparency on Australia's existing housing stock in order to reduce uncertainty."

The government must also provide "appropriate financial support ... for removing combustible cladding or reducing its associated risks," the union said.

Noonan said that this national problem requires a national solution, and that the union was willing to work with government to resolve these important issues for the community.

“Disempowering unions, who so often have blown the whistle on failures in the industry is the last course a government making sound policy decisions should take."

The federal Coalition government is instead preparing a new series of attacks on unions, primarily through its Ensuring Integrity Bill 2019, which it hopes to get through the Senate in late October.

The bill — which would give governments, and in some cases employers, powers to interfere in the internal operations of unions — is aimed first and foremost at undermining militant unions like the CFMMEU.