The move lands as concerns about misconduct in the construction sector have been building for months, with regulators pointing to a rare chance to reform an industry that underpins major infrastructure spending. NSW is facing allegations of union intimidation, bikie links and complex tax avoidance on large sites and is now leaning on its power as a major buyer of construction services rather than waiting for slow legislative shifts.
Under the new approach, the state’s Construction Compliance Unit will take a far more active role in policing behaviour across government building projects, not just at the top tier. From March 1, major contractors on public jobs must regularly list every subcontractor in their supply chain, including those several layers down and be ready to show evidence they are paying correct wages, superannuation, workers’ compensation and state payroll taxes. The government plans on-site and desktop audits to test industrial relations compliance and the scheme will run for at least 18 months before being reviewed.
This supply chain scrutiny follows a wave of allegations about conduct on high-value state projects. These include claims of threats, coercion and side payments to remove competitors from key sites. Regulators have logged close to 100 corruption-related complaints on public works in roughly the last year and a half. Some subcontractors and labour hire firms are already facing investigations over hundreds of millions of dollars in unpaid taxes tied to intricate labour arrangements. NSW authorities are also weighing further reforms such as accreditation for subcontractors on high-risk sites and stricter conduct rules designed to shut out criminal elements and clamp down on bullying.
Stepping back, NSW appears to be positioning itself as a test case for using procurement rules to lift standards in construction, even as other states lean more on traditional labour hire and policing measures. The new framework could reward firms that keep clean books and strong compliance systems. It may also raise costs, create additional administration for builders and leave open questions about how far the state will go in challenging powerful industry players and unions. With investigations still underway and other jurisdictions watching closely, the long-term impact on project delivery, pricing and workplace culture remains uncertain but potentially significant.
