A matter of principle !

It is a simple fact of life that self employed people usually earn more than those who work for a wage, but at the same time they face business risks.   Sub-contractors in the building industry spectrum can be seriously out of pocket if the firm they are contracting for collapses - leaving unpaid bills.

A curious situation has developed in the Illawarra that leaves 135 social housing sites not only unfinished, but now picketed by the sub-contractors owed money for work already done.

It all started when the GFC hit in 2008.  The Federal government devised a stimulus package to boost social housing.   This would be funded by Canberra, but managed by each relevant state government - and the work was let out to tender.   As seemed to be the case with so many government contracts, this work quickly got into difficulty, which eventually resulted in the building companies going into liquidation before the mix of villas and town houses were complete - leaving an array of sub-contractors unpaid for the work they had performed.  In some cases, this debt was well in excess of a hundred thousand dollars owed.

Unfortunately, this is a familiar outcome in the construction business.   In many cases it also send sub-contractors to the bankruptcy court, but most just take the loss and weather the financial storm - and accept it as a normal business hazard.

The difference in this case - was the fact that the job was " government inspired " , and that it involved both the Federal and state levels of government - and in the eyes of both the unions and the sub-contractors,  Governments " have deep pockets ".

The sites were declared " black " and pickets were set up.  There was a mix of demands.  Pressure was applied for both governments to pay out the unpaid sub-contractors bills, whilst others demanded that if new contractors were tasked with completing the jobs, they should not only be required to pay for the work already done - but hire the original sub-contractors to complete the projects.

While this remained unresolved, there came a change of state government - and this seemed to spur the militant Construction, Forestry, Mining and Energy union ( CFMEU ) to dig in it's heels and refuse to negotiate a reasonable settlement.

The result is another " Mexican standoff ".    The sites remain stagnant and unfinished and there are pickets in place.  Both levels of government are adamant that the bankruptcy of builders and their relations with sub-contractors involves a matter of principle.   It is one of the risks of doing business that sub-contractors face - and the fact that governments are involved as the contract owners has absolutely no bearing on the issues.

It simply illustrates the distorting factor that arises any time politics gets involved in a business transaction