BCITO backs government’s skills-based construction procurement crackdown

BCITO backs government’s skills-based construction procurement crackdown

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The construction industry’s training body says a crackdown on government procurement will cultivate skills the industry desperately needs.

The construction industry has boosted the economy and employment rates

The construction industry has boosted the economy and employment rates
Photo: RNZ / Alexander Robertson

Minister for Building and Construction Jenny Salesa yesterday announced the Construction Skills Action Plan, aimed at addressing skills and labour shortages in the industry.

The plan was broken down into six priority areas, one of which was leveraging government procurement: prioritising contractors with trained staff over those offering the cheapest tender.

Building and Construction Industry Training Organisation chief executive Warwick Quinn said the crackdown would ensure skilled construction workers throughout boom or bust in the economy.

Mr Quinn said they had been asking for such a scheme since the global financial crisis.

“We knew that we would have a training programme once the market recovered.

“Because the governement is the only one that builds of any substance during the recession, they have the ability to keep numbers up.”

More about the construction industry’s training woes:

  • Crackdown in construction industry to overcome ‘boom-bust’
  • Construction industry urged to diversify in apprenticeships
  • Govt contracts push risk to building firms, industry says
  • Mr Quinn said only about 10 percent of firms were training at any given time, and that figure needed to increase.

    He said smaller firms struggled with the cost of training people.

    “A formal investment in training is not something that’s small fry for them.

    “They have to put up four years worth of support. Some of the new apprentices are a bit unproductive in the first 12 to 18 months, so we think some support for them would also be worthwhile.”

    Economic Development Minister David Parker, who is leading the priority area of government procurement, said there was a culture of price undercutting in the industry.

    He said contractors undercut their competitors by not paying to train their workers and offering the cheapest tender.

    When those same contractors won the contract, they would then poach trained staff from employers who had invested in training, Mr Parker said.

    David Parker, Minister for Economic Development, Environment, and Trade and Export Growth.

    Photo: RNZ / Richard Tindiller

    “It’s completely wrong that they can do that at the moment, and you should ask yourself ‘why hasn’t this been fixed previously?’ and ‘is that one of the reasons why we have got a shortage of homes in New Zealand, and one of the reasons why the cost of construction keeps going up?’.”

    Mr Quinn said while the scheme meant government projects would cost more, it would save money in the long run.

    “I think over time you will find that construction costs will level out.

    “Many of those firms at the higher level do train … it tends to be the subcontractors and smaller firms that don’t have that level of training.

    “It’s true, there might be a slight cost originally but in the long run it’s better for us because if we continue to lose skills we will be in a worse position in future years.”

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