'We'll never see that money': Frustration at failed firms
CONSTRUCTION company collapses have become a grim but normal part of doing business for a Central Queensland crane hire firm.
Lee Crane Hire chief financial officer Ben Stubbs estimated he saw one or two bankruptcies per month within the construction industry.
More than 50 building companies have collapsed in Queensland since 2013, leaving more than 7000 subbies unpaid.
Industry figures estimate $500million has been left owing to subcontractors.
The most recent business failure that affected Lee Crane Hire was JM Kelly Group, which went into administration in October and then liquidation in November.
The collapse of the Rockhampton construction company left the family-owned business of 35 years about $4000 out of pocket.
The company offered crane hire for JM Kelly's construction projects.
"I have no doubt we'll never see that money," Mr Stubbs said.
Sharing Lee Crane Hire's story as part of News Queensland's "Back our Subbies" series, Mr Stubbs said the business would absorb the money owed as a bad debt, something it had done before when contractors had gone bust.
He pointed to other Queensland businesses that had gone bust recently including RCR Tomlinson, Ostwald Bros and Irwin Homes.
Mr Stubbs said he suspected JM Kelly was in trouble after its Project Builders arm, Colhart Investments, went into administration in 2016.
At the time the Queensland Government transferred 21 contracts it held with Project Builders to JM Kelly Builders.
The CFO of three years said he was becoming increasingly frustrated by the collapse of construction companies.
Mr Stubbs said there were a number of issues that needed to be solved to clean up the industry, including the way banks lent money and major businesses taking up to 60 days to pay subcontractors.
He said in some cases Lee Crane Hire had waited up to six months to be paid.
While Mr Stubbs said the company limited work with companies that had lengthy payment terms, some were not as fortunate.
"We have a lot of guys who are subcontractors, who drive their own own trucks, and they need to pay for fuel - so we can't hold those guys out because otherwise they'll go broke," he said.