WA Building Industry Reform Package

The building and construction industry of Western Australia is currently experiencing unprecedented times which many analysts have described as a “profitless boom” with no foreseeable end. 

The unpredicted surge in demand since 2020 has exposed underlying issues with standard procurement methods (in both the private and public sector projects), the use of non-standard contract formats, contract payment terms and timing. 

Master Builders Association of WA (Master Builders), in consultation with its members, has prepared the following Building Industry Reform Package 2022 which seeks to promote 18 recommendations to establish a more sustainable building and construction industry for all within Western Australia. 

The current approach to selecting a Builder in the Commercial Sector offers limited transparency and is heavily weighted on the “lowest price wins” scenario. This approach has resulted in a race to the bottom which has directly contributed to insolvencies within the industry. 

Many successful alternative procurement models are operating in other international markets which focus on value outcomes. The Building Industry Reform Package 2022 seeks procurement reform through exploring procurement models applied in Western Australia. 

Due to the volatile nature of global supply chains, the current financial challenges of unpredictable price escalation, availability of construction materials, and skilled labour limitations, coupled with onerous contractual requirements have seen the pendulum of risk move away from a fair and balanced arrangement. 

The Building Industry Reform Package 2022 outlines provisions for contract format rationalisation delivering fair provisions for all parties, as applicable to all contracting models and incentives to address industry jobs and skills within Western Australia as core reforms needed for the industry to move forward confidently.