Coggins, J; Teng, B and Rameezdeen, R (2016) Construction insolvency in Australia: Reining in the beast. Construction Economics and Building, 16(3), pp. 38-56. ISSN 2204-9029
Abstract
Insolvency has become endemic in the Australian construction industry. The scale of the problem has reached such proportions that both the NSW Parliament and the Senate have, in recent times, commissioned inquiries into construction insolvency. This paper aims to identify the reasons as to why the construction industry is so susceptible to insolvency, evaluate the effectiveness of any existing insolvency protection measures available to construction firms, and to identify proposed future measures to address the factors causing construction insolvency. The results of a questionnaire survey designed to discover the extent of the construction insolvency problem, as well as building contractors' views with respect to the causes and regulation of construction insolvency, in South Australia are presented. The research found that there is an appetite amongst building contractors for the introduction of further regulation to address construction insolvency. Further, although the research found underbidding to be the biggest contributory factor towards construction insolvency, it appears to be the most difficult factor to address through regulation which explains the paucity of recommendations which directly address underbidding emanating from the Senate inquiry in 2015.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | construction insolvency; phoenix companies; security of payment; underbidding |
| Index terms: | questionnaire, building contractor, effectiveness, regulation, insolvency, contributory factor, construction industry, security of payment, Australia, survey, construction insolvency, construction firm, South Australia |
| Subjects: | data collection methods, physical geography and landforms, risk assessment, organization, performance management, warranties, Geography, practitioner, industry analysis, liability law, political science |
| Topics: | Governance, Roles and Professions, Risk Management, Geographical Context, Research Practice, Business Strategy, Contract Administration, Quality Management, Legal Issues |
| Descriptive scope: | 5 PCTEA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here