Local companies missing out on tenders for State Government projects
The State Government is estimating thousands of jobs will be created from its Far North Queensland construction projects but a Tropic Now investigation reveals the head contracts are going to out-of-towners.
The Palaszczuk Government’s $967 million capital works program for the current financial year is being outlined today at a regional projects forum at the Cairns Convention Centre.
Assistant Minister for State Development Julieanne Gilbert said there are significant opportunities for the local construction industry.
“It’s expected about 3300 jobs will be directly generated from the capital works spending, up 27% from last year,” she said.
“More than 200 people from regional businesses involved with the construction sector and associate supply chains are expected to attend this year’s forum.”
However, hardly any of the projects being discussed at the forum have been awarded to local building companies.
- Smithfield bypass - Awarded to Highway Construction/Albem Operations Joint Venture (WA and Brisbane-based companies)
- Cairns Convention Centre expansion – Building contract yet to be awarded but architectural contract went to Cox Architecture (Sydney-based)
- Trinity Wharf Cairns – Awarded to Austral Construction (Melbourne-based)
- Cairns Southern Access Corridor – Awarded to Georgiou Koppen Joint Venture (Koppen is Cairns-based, Georgiou is predominantly WA-based)
- Atherton and Cairns Hospital Upgrades – Awarded to FK Gardner and Sons (Toowoomba-based)
- Cairns Hospital Mental Health Unit – No building contract awarded yet but consultants are (Brisbane-based) Rider Levett Bucknall and ThomsonAdsett
- Cairns South Health Facility – No building contract awarded yet but consultants are Peddle Thorp and Harvey (Brisbane-based), the surveyor is WTPartnership (Brisbane-based) and the project manager is Cairns-based AECOM.
WHY AREN'T WE GETTING THE CONTRACTS?
President of the North Queensland Civil Construction Association, Phillip Cassell, has told Tropic Now the lack of locally-awarded contracts is not necessarily because of problems with the tender process, saying local companies can do more to ensure they get the gigs.
“There is still a sentiment around town that we do miss out but people don’t understand clearly why they are missing out and what to do to ensure they’re in the running for these projects,” he said.
“In many cases we don’t have any one individual contractor that could successfully tender such big projects.
“For example, with the Smithfield Bypass the State Government did give locals the opportunity to form an alliance with a joint venture company.
“We couldn’t get a suitable joint venture together and when I spoke to the local companies they said it was too hard, they couldn’t be bothered and they wanted more than say a 20% stake.”
Mr Cassell said one local company that has had success through a joint venture is Koppens Developments.
“Koppens Developments did it with Georgio Construction on Ray Jones Drive,” he said.
“He’ll (director Scott Koppen) now win a $50 million project because he’s developing that position for his company.”
Mr Cassell said the State Government has been listening to North Queensland Civil Construction Association’s advocacy for local tenders.
“This is the first State Government we’ve had such success with,” he said.
“It’s probably because the five seats up here are critical to an election win and I’m certainly willing to exploit that.”
SKILLS SHORTAGE IS CONTRIBUTING
Education and training is another focus of the Association, with Mr Cassell highlighting a skills shortage when it comes to middle and upper management positions.
“We do have a lack of highly skilled people, there’s a lot basic workforce out there but with project foremen and project managers there seems to be a huge void,” he said.
“The issue is consistency in work, because it’s a boom and bust cycle in the construction industry.
"A training program for a good project manager would take five to six years and three quarters of a million dollars and we just don’t have that consistency of work that allows us to maintain that.
“It’s another reason why locals need to qualify for joint ventures.”
STILL PLENTY OF FLOW-ON WORK
Construction Skills Queensland has also long warned of a skills shortage.
Its Director of Evidence, Data and Innovation, Robert Sobyra, is at today’s forum assisting local companies get a share of capital works business.
“It’s an excellent platform to inform local businesses about upcoming supply chain opportunities and connect with the teams behind these major projects,” he said.
“We’re pleased to contribute by providing a construction industry outlook and analysis of the job flows expected to be generated, so local businesses can plan their workforce needs.”