4 November 2022

NSW Government refuses to pay Wagga tradies who helped build Spring Street public housing units

| Oliver Jacques
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Richard Foley with arms crossed outside public housing dwelling.

Plasterer and councillor Richard Foley in front of the public housing project he worked on but wasn’t paid for. Photo: Oliver Jacques.

The NSW Government has refused to pay mum and dad tradies and suppliers for the work they did on the now complete public housing building at 16 Spring Street in Wagga.

While the sleek, two-storey, one-bedroom flats are fully tenanted, small businesses who helped construct the government homes say they have now been waiting more than a year to be compensated for their labour and materials.

Plasterer Richard Foley says he has been left $55,000 out of pocket, Wagga Glass and Aluminium managing director Kevin Roben says he has lost $42,000, while Amy Burns of Bundalong’s Oasis Scaffolding and Bricklaying says her business is owed more than $90,000.

“I reckon I spent eight or nine weeks working on this block, including lots of weekends,” Mr Foley said. “But I still haven’t been paid … it’s shameful.”

READ ALSO A lack of social and affordable housing is ‘at the heart’ of Wagga’s housing crisis

In February 2021, the NSW Government announced controversial Sydney-based Matrix Group Co as the contractor to build the Spring Street project. By August, local subcontractors and suppliers wrote to the Government complaining Matrix Group Co were not paying them. However, the NSW Government continued to maintain their contract with the Sydney company until November, only terminating the relationship with Matrix after it went into liquidation.

Now that the project is complete, subcontractors say the NSW Government is responsible for compensating them for the work they did in good faith on a NSW Government asset.

“At the end of the day, it’s the Government’s project. It was their responsibility to choose someone who wasn’t insolvent. But they chose Matrix. They continued to pay Matrix even after I complained to them that the subcontractors weren’t being paid,” Ms Burns said.

“The [Government] has washed their hands at the job … we haven’t received any correspondence. The whole thing stinks … we are not multinational companies, we are mum and dad businesses.”

In October 2021, Matrix Group Co was the subject of a Channel Nine A Current Affairs investigation over their alleged failure to pay contractors all over NSW, from Wollongong to Wagga. The company has a very low 1.4 stars out of five average rating on Google, with most reviewers complaining about non-payment.

Public housing building

Public housing at 16 Spring Street. Photo: Oliver Jacques.

“The [Government] were warned many months in advance that there were problems and they continued to deal with Matrix. They have a duty of care to the subcontractors,” Mr Foley said.

The subcontractors have appealed to the Land and Housing Corporation (LAHC) – the NSW Government entity that manages social housing and chose Matrix Group Co for the Spring Street project – for payment. But Ms Burns said LAHC had stopped responding to her emails.

READ ALSO Housing crisis requires all tiers of government to step up: Bega Mayor

Region put a number of questions to the NSW Department of Planning and Environment, which includes the LAHC within its portfolio, on why subcontractors had not been paid, why LAHC were ignoring emails and why the government contract with Matrix continued even after complaints about their refusal to pay subcontractors. A department spokesperson did not answer the questions directly, but provided the following statement:

“The NSW Government was first made aware in 2021 of claims that subcontractors hired by Matrix Group Pty Ltd (Matrix) for a social housing project in Wagga Wagga had not received payment.

“We acknowledge the stress this would have on local businesses and take allegations of this nature very seriously. Following an investigation, the NSW Land and Housing Corporation (LAHC) reported the matter to NSW Fair Trading, Public Works Advisory and NSW Police.

“LAHC was involved in correspondence with subcontractors after the allegations were made, providing support and counsel where possible.

“As a result of this matter, LAHC commissioned an independent procurement review of the contract award, which found that LAHC’s due diligence activities, including consideration of financial capacity were deemed appropriate and in line with NSW Government procurement guidelines.

“The social housing project at Spring Street, Wagga Wagga was completed in June 2022 by a replacement building contractor. LAHC understands they contacted those subcontractors who had previously worked with Matrix on this project and a number were engaged to complete the works.”

However, Amy Burns, Richard Foley and Kevin Roben say they were never paid by the building contractor that replaced Matrix. They also said the Government failed to properly support or counsel them.

“They gave us nothing,” Ms Burns said.

But the fight continues, even though the subcontractors acknowledge it’s an uphill battle.

“The Government should definitely be responsible. But it’s very hard to deal with them. To take the Government to court costs a lot of money, and then you have to win,” Mr Roben said.

Do you believe the NSW Government's responsible for paying tradies and suppliers left out of pocket after helping build the 16 Spring st public housing units?

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