CCF WA NEWS

Fifteen years ago, Planning and Infrastructure Minister Alannah MacTiernan announced an “all-Western Australian consortium” of Doric and Brierty would build new railway stations at Rockingham and Warnbro, while another local company was awarded the Mandurah station contract.

A year earlier, the largest Mandurah rail line contract – for track laying and associated civil works – went to a consortium that included local contractors MacMahon and Multiplex.

These WA businesses benefited from a de-bundled approach, with design and construction of the Mandurah line packaged into nine separate contracts, giving local firms multiple opportunities to deliver key components of the project.

Times have changed, and nowadays most mega-projects – those exceeding $500 million in value – are delivered as single contracts. The Thornlie-Cockburn line and Yanchep extension have been bundled, despite being about 50km apart. The Morley-Ellenbrook line is also being procured as one main contract, albeit with some enabling works tendered separately.

These METRONET mega-projects are well beyond the financial capacity of local mid-tier contractors, which is why increasingly they are asking “what about us?”. Last week, recently formed lobby group Australian Owned Contractors lamented bundling of the Morley-Ellenbrook line “will once again result in a foreign tier one contractor delivering the project”.

The frustration is understandable. Proud Australian companies feel they are being locked out of major infrastructure projects in their own country.

The METRONET procurement strategy seems to conflict with the State Government’s strong commitments to local capability and jobs. When queried on this, it points to industry participation plans, which require head contractors to prove they are prioritising locals for subcontracting opportunities.

The reality is participation plans make little difference. Nearly all subcontracts on WA infrastructure projects are already delivered by local companies, mainly SMEs.

It’s WA’s mid-tier contractors – companies that have the financial capacity to deliver $10 million to $150 million projects independently, as head contractor – that miss out. These companies aren’t structured to subcontract and get no benefit from participation plans.

If we’re serious about building local capability, we need to provide more mid-tier head contracting opportunities for those local contractors that have continually demonstrated their commitment over many years to developing, training and maintaining a Western Australian workforce – not just on-site construction workers but also permanent management, engineering, administration and support staff in many and varied roles. Furthermore, they have built strong relationships with local suppliers of goods and services. In short, they are the lifeblood of the Western Australian civil construction industry.

This is not a jingoistic call for foreigners to be sidelined or for locals to be favoured. We’re asking for balance, and for a more equitable mix of contract sizes. CCF’s analysis of last year’s State Budget papers shows that $10 million to $150 million contracts could make up less than 15 per cent of WA’s major transport project pipeline by 2021/22 – down from about 40% currently – as the State Government ramps up METRONET.

Redressing this looming imbalance is vital to ensure we don’t lose local capability. In an infrastructure landscape increasingly dominated by billion-dollar projects, a creative and flexible approach is needed.

The New South Wales Government successfully de-bundled its massive $4.5 billion Pacific Highway upgrade into dozens of major contracts by hiring a tier one ‘delivery partner’ to assist with contract management. Here in WA, Main Roads has ensured at least some mid-tier involvement in the $800 million Bunbury Outer Ring Road project by strongly encouraging the inclusion of mid-tier contractors in the tier one-led consortiums – something that should have happened on the main METRONET projects. Main Roads is also considering a de-bundling strategy for the $275 million Bindoon Bypass.

The local industry doesn’t expect every infrastructure project to be de-bundled. There’s a place for mega-projects in the mix too. But if WA’s civil construction industry is to maintain our hard-won capacity and skilled workforce, we need a stronger pipeline of mid-sized contracts.

Andy Graham
CEO, Civil Contractors Federation WA

 

(This opinion piece was published in The West Australian, May 1, 2020)

Fast-tracked tendering of about $2.5 billion worth of infrastructure projects, announced today by the State Government, will provide an important economic boost and help offset reduced activity in private sector construction, Western Australia’s peak civil construction body says.

Civil Contractors Federation WA CEO Andy Graham said Main Roads’ new Statewide Road Construction Panel, which would be used to procure a range of projects up to $20 million in value, would greatly assist in getting these projects underway quickly.

“This will help the contractors involved to maintain continuity of operations and keep Western Australians employed,” Mr Graham said.

“Main Roads conceived this panel last year before anyone had heard of the coronavirus, but it’s certainly going to help them respond. The panel structure will allow tendering to be streamlined, cutting red tape when it’s most needed, while keeping the process fair and competitive to ensure value for money.

“For the larger projects in the pipeline, we applaud the State Government’s move to try and accelerate environmental and other approvals. While these approvals are of course necessary, they sometimes take far too long, especially when both State and Federal approvals are required.”

Mr Graham said the industry was encouraged by comments from Federal Minister for Population, Cities and Urban Infrastructure Alan Tudge this week that the Federal Government is considering more funding for transport projects in order to provide an employment boost that will help compensate for the slowdown in residential and commercial building construction.

“A recent nationwide survey of CCF Members showed that 90% had some spare capacity, mainly as a result of private sector projects being deferred by the COVID-19 crisis,” he said.

“All Governments understand that right now is a great opportunity to utilise that capacity in the civil construction sector to provide jobs and economic activity, while building infrastructure that boosts our productivity and quality of life.”

Projects include:

• Bunbury Outer Ring Road - (budget $852 million)
• Leach Highway Welshpool Road Interchange - (budget $93 million)
• Stephenson Avenue (Stirling) - (budget $125 million)
• Fremantle Traffic Bridge - (budget $230 million)
• Roe Highway/Great Eastern Highway/Abernethy Road - (budget $180 million)
• Albany Ring Road (budget $175 million)
• Great Northern Hwy Ord River North Stage 3 & 4 (budget $89 million)
• Lloyd Street Extension (budget $40 million)
• Tonkin Highway Gap project (budget $290 million)
• Mitchell Freeway Extension to Romeo Road (budget $215 million)
• Mitchell Freeway Hodges Drive to Hepburn Avenue widening (budget $76 million)

WA’s civil construction and maintenance industry continues to work safely through the COVID-19 pandemic, delivering important infrastructure upgrades across Western Australia and supporting regional communities, says the industry’s peak body.

Civil Contractors Federation WA CEO Andy Graham said the State’s civil construction workforce continued to travel around WA building and maintaining our big State’s essential road, rail, power and water infrastructure.

“We understand that some local residents have felt anxious about workers travelling between towns and regions at these extraordinary times,” Mr Graham said. “But the State Government has been clear that it wants us to keep working, upgrading vital infrastructure while boosting the economy at both the State and local levels, and making our regions safer, more productive and better connected.

“CCF WA Member companies are always conscious of supporting the communities they are working in, employing local workers and sourcing local goods and services where possible.

“Residents of regional WA can rest assured that civil infrastructure projects are among the safest of all construction workplaces, and the strict and effective safety systems and processes we’ve refined over many years are again proving their worth as we deal with COVID-19. It’s been made clear to all civil construction workers that they must implement social distancing and hygiene measures at all times – both on and off site.”

Perth-based CCF WA Member Enviro Infrastructure is currently delivering essential structural refurbishment works to Bridge 0034, on Albany Highway in Williams.

Enviro Infrastructure General Manager David Schlueter said the project team comprised a combination of Perth-based and local tradespeople, operating under a strict COVID-19 management plan and detailed operational protocols.

“Enviro are prioritising contracting opportunities for local businesses in their operations across Western Australia and are proud to keep the wheels turning through these tough times,” Mr Schlueter said.

“We’re working with Main Roads WA to ensure that the safety of our team, the local communities in which we live and work and the general public is the highest priority. One advantage of competing these essential works during the current crisis is that disruption to the public is being minimised due to the low traffic volumes.”

Busselton-based CCF WA Member Leeuwin Civil is constructing essential infrastructure for public access to the Lake Kepwari development, near Collie for the Department of Biodiversity, Conservation and Attractions (DBCA).

Leeuwin Civil Director Lissa Wypynaszko said the company’s scope of works includes roads, car parks, a boat ramp and other facilities. “The Lake Kepwari project also allows us to contribute to the economy of regional towns, like Collie, through subcontractors, materials, supplies, accommodation, meals, fuel and employment of locals,” Ms Wypynaszko said.

“Working in such a pristine natural environment, we already have extensive measures in place to limit our impact. This has been expanded to ensure we are not placing the Collie community at risk.

“We have previously undertaken contracts for DBCA in Collie and enjoy the opportunity to work on projects that will bring enjoyment to the community when restrictions are lifted.”

CCF WA Member Enviro Infrastructure delivering essential structural works at Bridge 0034, on Albany Highway in Williams.

 

CCF WA Member Leeuwin Civil constructing access infrastructure at the Lake Kepwari development, near Collie.

More info: ccfwa@ccfwa.com.au

Western Australia’s peak industry body for civil construction has welcomed a new $24.5 million support package for employers of construction trainees and apprentices.

The package announced by Premier Mark McGowan, Training Minister Sue Ellery and Construction Training Fund (CTF) Chair Reg Howard-Smith today includes an immediate $2,000 payment to employers of civil construction trainees, and a further $2100 in monthly ‘maintenance payments’ comprising $350 per civil construction trainee over six months.

Civil Contractors Federation CEO Andy Graham said the State Government and the CTF were to be congratulated for moving quickly to support the continuing employment of trainees and apprentices in the civil construction sector through the COVID-19 crisis.

“Our industry is feeling the effects of the crisis, with some projects being deferred and margins on existing projects eroded due to higher costs,” Mr Graham said.

“This bonus payment will help civil contractors to maintain their workforces as they deal with these financial pressures. Access to skilled local workers will be essential in the years ahead as the civil construction sector constructs and maintains the infrastructure needed to keep our State prosperous.”

Click here to read the State Government announcement.

Click here for the full list of qualifications covered by the CTF COVID-19 support package and the payments available.

The Western Australian civil construction industry is ready to partner with government to fast-track infrastructure projects and provide a much-needed economic stimulus, says the industry’s peak body.

Civil Contractors Federation WA CEO Andy Graham said the private sector civil construction pipeline in WA was already feeling the effects of the COVID-19 crisis, with regular reports of projects delayed or deferred.

“Now is the right time for the State Government and Local Governments to step up and accelerate their project pipelines,” he said. “They will get great value for money, they’ll keep a vital sector of the economy healthy, and the community will benefit from upgraded infrastructure, improving productivity and quality of life for this generation and generations to come.”

Mr Graham said it was vital that any infrastructure stimulus package of projects provided a broad spread of opportunities for contractors of all sizes, particularly local mid-tier contractors who were the most consistent contributors to the local economy and a source of permanent employment for thousands of Western Australians.

“Now more than ever, we need to look after our own,” he said. “We’ve already seen too many government projects bundled up into large packages to suit the big internationals, leaving local companies to fight over the crumbs.”

Mr Graham said a firm signal of intent was needed soon from Government to maintain business confidence – not just contracting businesses but the thousands of local suppliers of construction materials and equipment and specialist services who depend on a strong pipeline of opportunities.

“Our message to Government on behalf of WA’s contractors, consultants and suppliers is – we’re here, geared up and ready to help deliver an accelerated program of essential infrastructure projects,” he said.

Mr Graham said the industry continued to demonstrate it can work safely and effectively through the COVID-19 crisis.

“We’re proud to say civil infrastructure projects are among the safest of all construction workplaces, thanks to a concerted effort over the past 15-20 years by our industry in partnership with Government agencies,” he said. “The clear and effective safety systems and processes we’ve refined over many years are again proving their worth as we integrate strict hygiene and distancing measures in response to COVID-19.”

‘Hard’ border closure, regional travel restrictions

The State Government has tightened border controls from 11.59PM Sunday. Exemptions include:

• Specialists required for industry or business continuity and maintenance of competitive operation where the service is time-critical
• Persons responsible for critical maintenance or repair of infrastructure

Click here to download the form 'WA Entry - Request for Approval as an Exempt Traveller'

If you have any issues with key specialist employees being denied entry, threatening the continuity of a project, please let me know.

The State Government has also imposed travel restrictions between regions of WA from Midnight tomorrow night. People travelling to and from their workplace, or transporting freight, are exempt. Employees travelling between regions should be provided with documentary proof that they are travelling for work purposes, e.g.

• A signed letter on company letterhead stating they are a contractor or employee, and the reason they are required to travel between regions, including name and location of project/worksite
• A contact number for a person at the company who can verify this information
• Photo ID

The restriction applies to travel between these regions: Perth/Peel (treated as one region); South West; Great Southern; Goldfields-Esperance; Mid-West; Wheatbelt; Gascoyne; and Pilbara

NOTE: Access to the Kimberley (including the entire Shire of Ngaanyatjarraku, and parts of the Shire of East Pilbara encompassing the communities of Jigalong, Martu homeland communities and Kiwirrkurra) have additional stronger restrictions in place.

The State Government will soon be implementing an electronic system ('Good to Go WA'), with individual travel licences being issued to enable authorised persons to travel across State, Regional and LGA boundaries in accordance with their exemptions and any associated quarantine requirements. There will be a bulk upload function for companies to use to load their employees that must travel and are covered by exemptions.

 

Civil construction to continue operating safely

Premier Mark McGowan has stated clearly that the construction industry will continue to operate despite other restrictions. Mr McGowan added: "Whilst tradesmen and workers within industry, in particular the construction industry, are exempt from the new intrastate travel restrictions, they must remain vigilant with social distancing practices and hygiene on site."

CCF WA has assured Government that our industry can continue to deliver works safely and productively through this crisis. The civil construction industry has historically led the way in implementation of safety management systems and safer work processes, and we’ve adapted quickly to the current situation and implemented tough and effective control measures.

CCF WA is also meeting with representatives of building and construction industry groups and unions. We have agreed to send a united message to government that our industry is responding sensibly to the COVID-19 crisis and is ready to continue operating while keeping our workers safe. We believe it’s important to get on the front foot as an industry and reinforce the message that an active construction industry is critical to the health of the WA economy, and we’re taking that responsibility seriously.

Now it is up to all of us to demonstrate our commitment to keeping civil construction workplaces safe, by adhering closely to infection control measures such as social distancing and hygiene.

Safe Work Australia has published a fact sheet on minimising COVID-19 risk and exposure in the building and construction industry, with practical and relevant advice on social distancing and hygiene in a construction setting, and on consultation and communication with workers.

 

Pipeline of works

CCF is engaging with State Government infrastructure agencies/corporations seeking more detail on any plans to increase/fast track their capital works programs. With the private sector pipeline already being affected, additional govt works will be welcome.

 

Government support for businesses and employees

The Federal and State Governments have announced numerous measures providing financial support during this crisis.  These measures are detailed at the links below:

Federal Government support

State Government support

Coronavirus information for small business owners from the Small Business Development Corporation

CCF WA is engaging with Main Roads through the BORR Local Business Advisory Group in conjunction with the South West Development Commission.

The State Government recently announced the two consortia that have been shortlisted

• The Forrest Alliance (comprising CPB Contractors, Carey MC, Densford Civil, GHD and BG&E)
• Southwest Connex (comprising Acciona, NRW Contracting, MACA Civil, AECOM and Aurecon)

Main Roads and Transport Minister Rita Saffioti has stated that maximising local business procurement is a key objective for the BORR project. Through the Advisory Group, CCF’s role is to represent the local industry’s view on how that can be achieved.

Our advocacy includes

• Targets for local procurement -  an overall target (by value) including specific targets for: local road works contractors; local specialist subcontractors; and local specialist materials suppliers
• Discrete packages of work - CCF WA believes discrete packages (e.g. local road connections) will most effectively provide opportunities for local prequalified contractors, and local contractors with road-building capability.
• Service relocation works - CCF WA has written to Water Corporation and Western Power recommending local business procurement as a key objective for BORR-related relocation/enabling works.

 

Lodge your Expression of Interest for BORR opportunities

The South West Development Commission is asking local businesses to register their interest in BORR opportunities via a brief online form --  click here to register

 

Local Capability Fund grants

The State Government has announced a new Local Capability Fund round to encourage and support South West businesses to tender for work on BORR. Small to medium businesses in the South West can apply for up to $20,000 to help them tender for work on the project.

Grants can be used to meet essential prequalification requirements for supply-chain entry, buy and upgrade essential equipment and engage consultants for a range of expertise. If you’re considering an HSEQ management system, CCF’s Civil Contractor Management System is highly regarded and recognised by Main Roads.

A message from CCF WA CEO Andy Graham

In these difficult and uncertain times, CCF WA is focused on supporting our Members the best we can and continuing our role as the 'voice' of the Western Australian civil construction industry.

Many of you have contacted CCF in the past week. Your updates and insights on what’s happening in the market, and how your business is being affected, have been much appreciated and very useful in informing how we respond on behalf of the industry.

The main purpose of this message is to make it clear that civil construction activity has not been stopped by either the Federal Government’s latest restrictions on non-essential services or the State Government’s latest control measures. The construction sector (including businesses supplying construction goods, materials and services) have not been included in the list of ‘non-essential services’ that are prohibited. Therefore, the clear message is that we are in the ‘essential’ category and should keep calm and carry on.

At an advocacy level, CCF WA has written to the Premier and key Ministers responsible for infrastructure delivery, welcoming the ‘essential traveller’ exemptions to border closures announced on Tuesday, which will assist movement of essential construction industry personnel and freight.

We have further requested that civil infrastructure construction and maintenance activity be permitted to continue in the event of any further restrictions. The nature of civil infrastructure construction and maintenance operations – typically outdoors and with a low density of workers compared to other sectors – means that highly effective control measures can be implemented with relatively little disruption to workflows.

CCF has reminded the State Government that the civil construction industry has historically led the way in implementation of safety management systems and safer work processes, in partnership with our clients in Government and the private sector. We have adapted quickly to the current situation and implemented tough and effective control measures.

If our industry is to continue receiving this licence to operate, it is up to all of us to demonstrate our commitment to keeping civil construction workplaces safe, by ‘walking the walk’ and adhering closely to infection control measures, every minute of the day. We must integrate 'social distancing' into all processes and maintain separation of at least 1.5m at all times. These measures to reduce close contact should be supported by a stringent focus on hygiene, through regular hand washing/sanitising and industrial grade cleaning of common areas/equipment.

Managing the risks from COVID-19 – advice for employers from Safe Work Australia

Coronavirus (COVID-19) resources – fact sheets and downloadable posters.

Coronavirus and Australian workplace laws – latest advice from the Fair Work Ombudsman

 

Support for businesses

The Federal and State Governments have announced a wide range of measures designed to soften the blow to businesses.

These include:

Temporary relief for financially distressed businesses – a temporary increase to the threshold at which creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive.

Increasing the Instant Asset Write-Off – from $30,000 to $150,000 from 12 March 2020 until 30 June 2020, and now including businesses with annual turnover of less than $500 million (up from $50 million), along with accelerated depreciation deduction arrangements.

Boosting cash flow for employers – between $20,000 and $100,000 to SME businesses (annual turnover under $50 million) that make eligible payments, e.g. salary and wages.

State Government assistance includes one-off grants of $17,500 to businesses with annual wages between $1 million and $4 million

Supporting apprentices and trainees - businesses employing fewer than 20 full?time employees who retain an apprentice or trainee can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage paid during the 9 months to 30 September 2020.

Latest information on temporary changes to superannuation arrangements from CBUS

CCF WA is aware there is considerable uncertainty about how State Government departments, agencies and corporations will deal with contractual obligations that may not be met because of this unprecedented event. We have written to infrastructure delivery agencies/GTEs urging them to extend Government contracts without penalty if delays directly result from staff absences or supply delays caused by COVID-19, and to direct head contractors that they will only be granted such an extension if it is passed ‘down the chain’ to all subcontractors and suppliers.  We would expect the same consideration is shown by clients in Local Government and the private sector. All businesses will be under financial pressure during this crisis. As a matter of principle, businesses must not be put under further pressure, or even fail, by being unfairly penalised. If you feel this principle is not being adhered to, then please let us know.

(Please contact ccfwa@ccfwa.com.au as our office may be unattended)

Western Australia’s peak civil construction industry group says WA’s proposed industrial manslaughter laws are significantly tougher than similar laws in other states and should be referred to a parliamentary committee for careful review.

Civil Contractors Federation WA CEO Andy Graham said industrial manslaughter laws in other Australian states and territories all required some level of negligence on the part of the person being prosecuted, while ‘gross negligence causing death’ was the test recommended in the influential Boland review into Work Health and Safety laws.

“In WA, however, a business owner or manager could be charged with industrial manslaughter – carrying a maximum penalty of 10 years jail – and the prosecution would not even have to prove negligence or recklessness," Mr Graham said.

"WA’s small businesses should be most alarmed as they will be most at risk. Experience in other jurisdictions shows that smaller businesses are more likely to be prosecuted than larger, more well-resourced businesses."

Mr Graham said CCF WA's other concerns with the legislation included:

• No provision for prosecution of reckless or negligent behaviour by employees causing death - inconsistent with the principles of the legislation and shared responsibilities for safety.
• Individuals or family businesses could be prosecuted in relation to the death of a relative
• Inclusion of manslaughter offence in WHS legislation could compromise the common law privilege against self-incrimination

Mr Graham said CCF WA endorsed the Chamber of Commerce and Industry’s view (“Scrutiny must be applied to rushed industrial manslaughter provisions”) that further examination is needed of these critical provisions. CCF WA supports CCIWA’s recommendation that the Bill be referred to committee.

(This opinion piece by CCF WA CEO Andy Graham was published in The West Australian, Monday, February 17, 2020.)

Infrastructure construction has been in the news recently with claims of major delays and even ‘chaos’ on some of the upgrade projects going on around Perth. As the industry group representing the sector, we believe it’s time to address a few misconceptions.

Perth’s major civil construction sites are far from chaotic. On the contrary, works proceed calmly, professionally and most importantly, safely. For Main Roads and its contractors there are three basics: projects must be delivered safely, with the least possible inconvenience to motorists and nearby residents, and to the highest quality (the remarkable quality and durability of our roads doesn’t happen by accident – Main Roads’ specifications are among the most rigorous in the world).

We have been surprised to read negative commentary around the apparent lack of workers visible on road upgrade sites. It’s important to understand that building a road is not like building a house; a lack of tradies swarming over the site does not indicate a lack of activity.

For construction contractors, time is money. Every extra day on site reduces their already tight margins. Contractors are highly motivated to finish a project as quickly as possible, so they can get paid and move to the next job.

The fact is, though, that complex brownfields projects can’t be rushed. There’s more to adding a lane than clearing some space and whacking down some hotmix.

Carefully identifying and relocating essential underground services such as power, gas and water can take many weeks. Water is the enemy of a long-lasting road, so thorough and time-consuming dewatering is usually necessary. Millions of cubic meters of sand must be excavated, removed and replaced with subgrade, sub-base, basecourse, and multiple asphalt layers, all of which have to be thoroughly and patiently compacted and tested.

All of this, and much more, goes on within incredibly constrained sites, typically with traffic whizzing by on one side and houses, shops, a railway line or a river just metres away on the other. The contractors who perform this juggling act deserve our admiration, not condemnation.

Any additional congestion during construction works is regrettable but it’s important to remember the congestion well and truly predates the works. Some of the sections of freeway and major arterials being upgraded have been major bottlenecks for years – which is of course why the works are being undertaken. Infrastructure Australia has forecast that by 2031, Perth could have seven of the 10 most congested roads in the country – including the top four – unless we act decisively.

Sure, some projects will open a little later than originally intended. That’s mainly because there have been substantial changes of scope to those projects. These scope variations make perfect sense – if other remedial or preparatory work is identified that needs to be done, the best time to do it is now, rather than causing lengthier (and more costly) disruption later.

Some people have wondered why all construction contracts don’t include damages to ‘punish’ the contractor for actions that lead to congestion. Financial penalties, it is argued, would create a strong incentive for the contractor to meet shutdown deadlines. Except, they wouldn’t.

The reality is that sometimes the best laid plans go awry, despite contractors making the best decision in the circumstances and with the information available at the time. Hitting contractors with onerous penalties won’t change that.

Not that governments are averse to penalties. The State Government is far from a soft touch when it comes to contract conditions, and we have long argued for fairer risk allocation in contracts – so that, for example, a contractor doesn’t have to bear the cost of relocating a gas pipe that wasn’t on the plans provided, or removing some buried asbestos that no one knew was there.

Increasingly, however, governments acknowledge that the ‘old way’ of onerous contracts and adversarial relationships does no one any good, least of all taxpayers. Recently the Transport and Infrastructure Council – comprising the Federal and State transport and infrastructure ministers – agreed that “collaborative-based approaches to procurement, project management and risk allocation promotes safer and more productive delivery”. CCF WA welcomes this progress towards a more collaborative approach, and a culture where clients and contractors work together to achieve the best outcomes.

Andy Graham
CEO, Civil Contractors Federation WA