New rules governing the conduct of contractors bidding for government building and infrastructure work in Queensland and New South Wales will help insulate taxpayers from cost blowouts on public sector construction projects, governments of the two states say.

Having come into force on July 1, the Queensland Code of Practice for the Building and Construction Industry and the New South Wales Code of Practice for Procurement: Building and Construction set out practices expected of contractors bidding for public sector work in their respective states in areas of tendering practices, project planning, contracting, environmental management, security of payment, workplace management and industrial relations.

Contractors who do not comply with the codes face exclusion from future public sector work for specified periods of time.

While broad ranging in nature, the introduction of the new codes follows the abolition of the Australian Building and Construction Commission (ABCC) and is aimed at curbing what the two governments say has been unlawful union activity leading to major cost blowouts on public sector projects in recent years.

A stand-off lasting several months at the Brisbane Children’s Hospital site last year, for example, added $7.4 million to the price tag of that project, the Queensland government claims.

Jarrod Bleijie

Jarrod Bleijie

“These measures will help fix the problems created by the Federal Government when it abolished the Australian Building and Construction Commission,” Queensland Attorney-General Jarrod Bleijie says.

Bleijie adds he is aware of tradespeople being locked out by unions and claims the new rules will save between five and 15 per cent of the cost of major infrastructure projects.

“My message to the building and construction unions is simple: Queensland will not tolerate bullying, intimidation and unlawful industrial action,” he says.

While popular with building industry groups, the new codes are opposed by unions, who largely see them as part of an effort by conservative governments to introduce elements of WorkChoices into public sector building sites.

The codes also face an uncertain legal future following a Federal Court ruling in May that the Victorian government acted unlawfully in using similar rules introduced last year to exclude Lend Lease and Eco Demolition from work on the Bendigo Hospital in Bendigo and the Circus Oz Project in the Melbourne suburb of Collingwood.

NSW Treasurer and Minister for Industrial Relations Mike Baird acknowledged that decision but says an appeal is underway.

Neither Baird nor Bleijie could be reached for comment about the likelihood of the new codes surviving legal challenges, but Baird says the three governments have issued practice directions to ensure aspects of the guidelines relating to enterprise agreements were not applied whilst the appeal is in progress.