Shorten’s promise: We will go after deceitful builders

SUBBIES

FEDERAL Labor will pledge cash to go after unscrupulous builders who burn their companies and start new ones to avoid paying their debts.

Opposition leader Bill Shorten is set to unveil the pre-election policy announcement in Townsville today in the wake of a Bulletin campaign revealing subcontractors have lost more than $500 million to 50 collapsed building companies since 2013.

Labor said if it won government it would create a $4.5 million “subbies income fund” for subcontractors to access if they fell victim to illegal phoenix activities.

Mr Shorten also plans to pledge a new $7 million “tradie litigation fund” to help fund court actions against companies and directors who have left them out of pocket.

The pledges follow one from the State Opposition yesterday, when LNP leader Deb Frecklington committed to establishing a Commission of Inquiry should she win power at the next state election.

Federal Labor said phoenix activity, where company directors deliberately folded their company and rebirthed it to avoid debts, cost the Australian economy more than $5 billion per year.

It said the litigation funding would go to the Australian Securities and Investments Commission, enabling it to run more difficult court cases without draining existing resources. “Not only will this give tradies their day in court, it will also act both as a punishment and deterrent for dodgy directors,” the party said.

“People who deliberately burn their companies should be subject to the full consequences of failing directors’ duties, including being liable for compensation, fines of up to $200,000 or five years behind bars.”