Presented by Robert Clark MP		www.robertclark.net

PREMIER'S NEW HIH ANNOUNCEMENT SHOWS HE DOESN'T UNDERSTAND

News Release - Tuesday, 29th May 2001

Claims by Premier Bracks that proposed Government legislation to delay suspending the registration of builders formerly insured with HIH will resolve the difficulties of builders who are unable to work are wrong, Shadow Minister for Planning, Robert Clark, said today.

Mr Clark said the Premier's comments showed that he understood neither the law nor the needs of small business.

It also showed that the Government had completely misjudged the extent of the crisis, having for weeks claimed that builders were not having difficulties in obtaining replacement insurance.

The Premier told Parliament today that a Bill, to be introduced into Parliament this week, will allow the Building Control Commission to hold off until 31 July on suspending the registration of builders who are unable to obtain replacement insurance following the collapse of HIH, provided they are making every effort to obtain replacement cover.

However, Mr Clark said this would do nothing to allow those builders to get back to work.

"What the Premier doesn't understand is that whether or not a builder is registered, a builder cannot start a building project without a building permit, and the builder can't obtain a building permit unless he or she has insurance cover for that project. Delaying suspension of the builder's registration makes absolutely no difference to this." Mr Clark said.

A notice issued by the Building Control Commission on 10 May, and posted on the BCC web site, clearly states: If you are proposing to build for an owner or other client the building surveyor must be satisfied that you have insurance for the particular project. A letter of eligibility is not insurance. You need to obtain job specific or other insurance cover for your project.

It has been estimated that around 1300 builders have been unable to obtain replacement insurance cover in Victoria, and that 2000 projects valued at more than $330 million have been put on hold because of the HIH collapse.

"What the Premier also fails to understand is that every day that passes without a builder being able to work puts more strain on that builder's cash flow. A few weeks' delay mightn't mean much to the Premier, but to a builder it can mean the difference between survival and going out of business.

"Builders need a way to overcome the paperwork bottlenecks that are choking their industry, so that people can get back to work and customers can get their projects built.

"At the beginning of May, the Premier told Parliament that builders could get the cover they needed within 72 hours, and the Minister for Finance told Parliament builders should not have their work held up for extended periods because of insurance problems. By mid-May, the Government had admitted that it would take until 'the end of the month' before most builders would have obtained reinsurance.

"Now the Government at last appears to have conceded that the problem will drag on for even longer, and yet the amendment they announced today does nothing to help overcome those problems.

"Since as far back as 21 April, the Opposition has been calling on the Government to act on this problem. The Opposition put forward specific proposals for the Bracks Government to enable the building industry to obtain temporary global insurance cover - paid for by the industry, not taxpayers - while the paperwork was being processed for HIH insured builders to obtain individual replacement cover."