As fears grow for New Zealand's building and construction industry, the industry are set to look to the Government to reset procurement policies as costs and labour shortages take its toll.
Last week, major construction firm Ebert Construction collapsed, leaving hundreds of workers and contractors across the country in limbo , facing an uncertain future. It was estimated at least $40 million is owed to creditors.
Economists say it is a worrying sign, especially with big players such as Fletcher Building facing tough financial times.
Minister for Infrastructure Shane Jones said on TVNZ1's Q+A last night agencies were keen for the Government to commit to procurement policies.
"They believe that when the Crown is involved there needs to be a re-collaboration of who bears the risk [of] projects and escalating costs," he said.
Q+A host Corin Dann asked if taxpayers should take more of the risk, possibly paying for the losses instead of the construction sector and stakeholders.
Mr Jones said it was legitimate for the construction sector to be concerned, and to want the Government to look at "a reset of procurement policies".
Dann pushed Mr Jones' on if the taxpayer could take on liability of large scale projects, "that if they go wrong it would be the taxpayer bearing the cost".
"I'm not saying that," Mr Jones said. "What I'm saying is that they have raised the necessity of us being a lot more pragmatic about our procurement policies".
He said it also called for the creation of an infrastructure agency so the Crown has "a far better and more robust agency than something obscured in the foliage of Treasury".
Dann asked if the issues with the building and construction sector was a reflection of a high level of uncertainty in the economy from the current Government's policies.
"Dealing with this business of confidence in the business community is a bit like a game of whack-a-mole," Mr Jones said. "You strike it here, and it pops up over here."
SHARE ME