Weekly News Highlights - 8th May 2020
5. West Gate Tunnel Completion will be Delayed Until 2023
Transurban has finally admitted that West Gate Tunnel won’t be delivered until 2023, a year later than expected. The delay is expected to cost them “millions of dollars a day” - probably the reason that they didn’t want to admit it to the ASX.
Transurban told the ASX that the "Commencement of tunnelling requires resolution on a range of matters, including disposal site confirmation, preparatory works, achieving relevant approvals and resolving commercial matters.”
This comes long after warnings from the contractor, John Holland-CPB Joint Venture (JHCPBJV), that the 2022 completion time was not possible.
The delay is a result of the stand-off over contaminated soil which the joint venture says exceeds the thresholds of PFAS allowed for in the contract and therefore requires additional disposal measures including upgrades to waste sites before it can even be disposed of.
JHCPBJV has tried to walk away from the contract in January under a Force Majeure Termination Event but Transurban responded by saying that it “does not consider the D&C subcontract has been validly terminated and, as such, the contract remains valid.”
4. Report Unsafe Sites Anywhere, Anytime
‘Speak Up, Save Lives’ is the name of SafeWork NSW’s new app designed to ‘make it easier than ever to report workplace risks’.
Minister for Better Regulation, Kevin Anderson, said “SafeWork inspectors do a fantastic job – but they can’t be everywhere at once. The app is a quick, easy and confidential way for anyone to report unsafe worksite or work practices using only their mobile phone.”
The app complements the web-based version which was launched in October 2019 in consultation with the family of 18-year-old scaffold collapse victim Christopher Cassaniti.
“Since launching Speak Up, Save Lives as a web platform in October last year, SafeWork has received 1647 reports from workers, handed out 472 improvement notices and $56,880 in penalties,” Mr Anderson said.
To download the app search ‘Speak Up NSW’ in your mobile app store. For more information or to report online, you can go here.
3. $24.5M for WA Employers, Apprentices & Trainees
Western Australia Premier, Mark McGowan, announced a $24.5 million support package aimed at maintaining a skilled construction workforce.
$10 million will be paid out in one-off $2,000 payments straight into the pockets of employers to maintain existing apprentices currently receiving Construction Training Fund (CTF) grant payments.
$9.5 million will go towards employers to retain their existing apprentices & trainees. Payments will range from $250 a month to $500 per month per apprentice or trainee, depending on the trades facing the biggest skills shortages with brickies taking home the most.
An additional $5 million will be spent to offer $1,000 cashback for more than 5000 building and construction apprentices and trainees to complete short training courses.
WA Training Minister Sue Ellery said “If you’re an apprentice in the construction industry looking to upskill – now is the time to take the opportunity to claim back up to $1,000 when you undertake a short course.
2. Lendlease Seek $1.15B after Analysts Raise Financial Concerns
After warnings of a balance sheet under pressure, Lendlease have begun procedures to raise $1.15B to keep it alive during a global downturn in property and construction.
Analysts also flagged other risk factors including a negative credit score, the rapid deterioration in the operating environment, and losses in its engineering arm (around $0.5B) which it sold to Acciona on the condition that Lendlease retain its loss-making projects.
Analysts expect the firm’s earnings and distributions to fall by as much as half as many of its large number of upcoming projects get cancelled or delayed due to the pandemic.
The total losses the company incurs from the embattled Melbourne Metro project are also yet to be fully determined after it came to a grinding halt in December over cost and deadline disputes reported to potentially blow the project costs out by up to $3B.
1. Timber, Home Improvement and Commercial Sectors Take Hit
After losing around 30% of harvestable Riverina pine forests to the bushfires, the timber industry has now been hit by the coronavirus.
Australia’s largest sawmilling company, AKD Softwoods, has laid off 51 workers from its sawmills in Colac, Victoria and temporarily shut down one its two sawmills there.
The company recently had to force 800 workers to take annual leave and cut down to 4-day work weeks.
The company doesn’t meet the criteria to qualify workers for the JobKeeper payment but the company says it is preparing for the imminent slow-down to the housing sector.
Forecasts show a drop in housing demand with Master Builders Victoria reducing figures from 159,000 new home commencements next financial year down to 115,000.
Meanwhile, online tradie hiring platform, serviceseeking.com.au has released data showing a 15% slow-down in the demand for trades. Co-founder, Jeremy Levitt, said that despite the overall drop in demand, the data shows the demand for some trades has increased, correlating to people undertaking DIY projects themselves.
Daniel Tartak, boss of skip bin company Bingo, told the Macquarie Australia investment conference that work is shrinking in the residential and commercial sectors as universities, leagues clubs and households reduce expenses.
In case you missed, 18 migrant workers were found by police inside a concrete agitator in India as they tried to avoid lockdown restrictions after getting stranded jobless away from home. Watch the video here.
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