Construction subcontractor payments
Deputy Mattie McGrath highlighted unpaid subcontractors and asked whether the Construction Contracts Act was effective and whether the legislation should be revisited. The Minister outlined steps to finish the affected school projects and retender them while acknowledging the impact of the collapse.
We are all well aware about what has happened with the Sammon Group and Carillion Group in the UK, and the devastation this has caused to schools in places such as Kells, Bray and Wexford. Behind that story, there are families. One such family company is that of Bobby O'Farrell & Sons, established in Thurles in 1989, and dozens of other small companies, often family-owned, which worked as subcontractors and are not being paid. They are owed huge sums of money, which leaves them unable to pay their suppliers. These are excellent trading companies that employ people, in this case since 1989, and there are many such other companies in Tipperary.
We spent years here trying to have the Construction Contracts Act introduced but has it been enacted at all or does it offer any protection for subcontractors? They are the backbone of our economy. They pay the bills and employ people locally and they are the ones that deliver the projects. These big companies could never deliver the projects without the support of these small companies in Tipperary and all over the country.
Comment on this
Is the Construction Contracts Act effective? Is it enacted? Why are these people being left high and dry?
Comment on this
It is very unfortunate that as a result of the collapse of the Sammon Group, 200 employees, and their families, have been impacted, as well as a number of subcontractors. It is a very serious fallout for those individuals. I have personally expressed my sympathy with them. We have 11 projects which we must now proceed to finish. Some are under the Dutch Infrastructure Fund, DIF, which has the responsibility for retendering. That is at a very advanced stage. In respect of our own school projects, we are drawing up the schedule of costs and will retender.
On the protections that have come into those school contracts, they are effective in that they have given subcontractors more rights but they are not 100% foolproof. They provide for more regular payments and they provide rights for the subcontractor to stop or block the contract. Those provisions are effective in giving more protections but as we have seen, they are not 100% effective where a company goes into liquidation.
Comment on this
Will the legislation be revisited?