By ERWIN CHLANDA
Bush work, the bread and butter for many local builders, will be further decimated by initiatives announced by Chief Minister Adam Giles today, which are punitive, unrealistic, and put the future of the construction industry in The Centre at serious risk.
So says a local builder speaking on the condition of not being named.
He says the new Aboriginal Affairs Strategy, that requires 70% of all contracts for civil and construction projects under $5 million in remote Aboriginal communities go to local Aboriginal businesses by next year, will blow the lid off anger in the industry that has been simmering during the implementation of steps leading up to that regime.
“We’ve set a number of ambitious employment targets and policies including doubling public sector Indigenous employment from 1800 to 3600 employees by 2020, and initiating Aboriginal employment requirements for all Government infrastructure contracts above $500,000,” says Mr Giles.
The source says the Chief Minister’s policy is assuming there is an Aboriginal construction industry which in fact doesn’t exist, a skill base that is still largely absent; there will be a blow-out in pay for the few Indigenous people who do have skills and that will in turn escalate what non-Indigenous people will charge.
This is how it works: The government has placed “10% provisional sum” on all construction works over $500,000.
So a job that the Government estimates to be worth $1m will have an extra line in the tender price called “Indigenous Employment Provisional Sum $100,000”.
According to the source, the government’s intention is that the industry will price the job as normal, win the job and then utilise the Provisional Sum (PS) sum as a “bonus”.
All Indigenous labour costs on the job would be refunded to the builder from the PS sum amount, intended by the government to be a bonus for using Indigenous workers.
“But in the cut throat commercial construction market this doesn’t work,” says the source.
“We tried it and lost every job as other firms deducted the PS amounts from their tenders.”
Yet that strategy is leading to catastrophic failures, says the source: “Indigenous workers have a much lower skill level, but to qualify for the PS a quota of Indigenous workers, usually one-third, must be employed.
“The cost of this inflated staff number makes the job a money loser.
“Head contractors are naturally passing a proportionate amount of the risk down to sub-contractors, which is quite upsetting for them, but there is simply no option,” says the source.
There are many other challenges, including legal issues, according to the source:–
• The small pool of skilled Indigenous staff has resulted in massive increases of their demands, leading to exorbitant rates.
• Non-Indigenous staff get offended by being paid less “due to skin colour” and as such rightfully ask for a pay rise.
• Bidding companies compete for valuable Indigenous staff.
• Our core, long term staff often cannot be used because their work needs to be done by Indigenous workers.
• People are identifying as Indigenous and start claiming it to improve job prospects. This is completely predictable given the Government isn’t willing to test these claims.
• Any training not directly associated with the project cannot be claimed, so the Indigenous work force is not getting any more skilled than before.
• Companies are forced to employ on ethnicity not merit.
The source says two of his company’s Indigenous staff did not turn up today: “So they get let go and we have to recruit more.”
He says: “The government requires time sheets, pay slips, spread sheets, information on wages, super and so on.
“This is all strictly confidential information to which the NT Government has zero right to be given.
“Identifying someone’s ethnicity is in the same category as sexuality, religion and so on.
“The policy seems to have multiple inconsistencies with the Information Act,” says the source.
Predictably, Mr Giles has a different take on the scheme.
He says though it “576 Indigenous people have been employed on Government construction contracts since October 2014. Prior to this initiative, there were just 40.”
The source says this pure fabrication: “There have been no surveys about the number of Aboriginal people employed. There would have been hundreds more.
“We don’t ask anyone whether they are Aboriginal.”
Mr Giles says in a media release: “My Government strongly believes that the integral link between economic and cultural success is through local Aboriginal people gaining access to and participating in a local economy, and that’s what our Aboriginal Affairs Strategy is focussed on.”
PHOTO: Ingkerreke workers – archive.
By ERWIN CHLANDA