Laing O'Rourke Appeals Building Watchdog Suspension


British construction giant Laing O’Rourke has launched an appeal after the Queensland Building and Construction Commission suspended its building licence last week.

Laing O’Rourke applied to stay QBCC’s decision in the Queensland Civil and Administrative Tribunal on Monday.

The contractor’s licence was revoked after an 11-month investigation revealed that the company’s operation in Queensland presented “a serious risk of financial harm to the sector”.

QBCC commissioner Brett Bassett said that the company wasn’t meeting Queensland’s minimum financial requirement laws.

“The company was given a show cause notice and provided updated information, however it failed to show how the company was operating within the law, and with allowable asset levels,” Bassett said.

“[The] company is operating outside its allowable annual revenue limit and this presents a serious risk of financial harm to the sector.

“The QBCC has issued a licence suspension, the next step in the regulatory process, effective immediately, which means that work on the company’s Queensland sites must stop.”

A QBCC spokesperson said on Monday that they will provide no further comment while the matter is before the courts.

Related: Laing O’Rourke Appointed to Deliver $955m Central Station Revamp

In 2017, Laing O’Rourke pulled 800 contractors off the Ichthys LNG project in Darwin (pictured) after a contract dispute.
In 2017, Laing O’Rourke pulled 800 contractors off the Ichthys LNG project in Darwin (pictured) after a contract dispute.

Minister blocks Laing O’Rourke

Minister for Housing and Public Works Mick de Brenni said that Laing O’Rourke would be removed from its go-to list of prequalified contractors.

“I confirmed that the government’s register of prequalified contractors – the go-to list for agencies to choose a builder – was updated to make it clear that contracting with this company is not to occur until the matter is sorted,” de Brenni said.

“Individual departments are still gathering information on whether the suspension affects their projects and I’ve asked for this to be provided to me as a priority.”

In a statement, Laing O'Rourke said its losses were related to increased investment in tendering and a “small number of legacy projects”.

“The business has no outstanding creditors, a strong cash position and continues to operate profitably, holding building licences in all other jurisdictions across the country.”

In 2017, Laing O’Rourke abandoned a $34 billion Ichthys LNG processing facility in Darwin after a contract dispute left the contractor $187 million in the red. Laing O’Rourke recently recorded a pre-tax loss of £43.6 million (A$80m) for the year to 31 March.

The 2017-18 financial results figures include the group’s businesses in the UK, Canada and Australia.

The construction behemoth has a catalogue of 13 projects in Queensland including the Brisbane airport expansion and the $370 million Battlefield Airlifter expansion project at Amberley.

A Department of Defence spokesperson said that the department was aware of QBCC’s findings.

“Defence will examine the implications of the QBCC’s decision for its projects, including the work to expand the Shoalwater Bay Training Area under the Australia-Singapore Military Training Initiative.”

Laing O’Rourke won the $800 million Shoalwater Bay contract in September 2018.

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