WA Government Seeks Millions in Damages from John Holland 2

Tuesday, August 23rd, 2016
liked this article
Lovegrove Solicitors – 300 x 250
FavoriteLoadingsave article

The WA government’s massive damages claim against builder John Holland for the unfinished Perth Children’s Hospital has increased after it was revealed a private contractor is getting $500,000 a month in taxpayer money for an unused car park.

WA Health Minister John Day says the government will demand John Holland pay back an amount expected to reach at least $2.5 million.

That is on top of the tens of millions of dollars in liquidated damages the government will already claim due to faulty fixtures and delays of more than a year in the new hospital’s completion.

The discovery of asbestos sheeting in Chinese-made roof panels at the $1.2 billion facility six weeks ago was the low point in a trouble-plagued project that has left the government furious with John Holland.

The delays in finishing the hospital triggered a contract clause from July 1 requiring the government to pay the Capella Parking consortium – which has built a $120 million-plus multi-storey car park at the site and includes Probuild, Wilson Parking and Capella Capital – $500,000 a month.

“There will be a lot of discussions between the state government and John Holland once the hospital has been completed,” Mr Day said.

“The delivery of the hospital has been much later than the government has wanted, that will lead to some compensation being paid by John Holland.

“All of those issues need to be negotiated after the completion of the hospital.”

Mr Day said the cost of building the car park would be incurred by the Capella consortium and once the hospital was completed “everybody would move on and wonder what the fuss was about”.

John Holland has suffered significant damage to its reputation over the hospital, playing a central role in another scandal: widespread complaints by subcontractors who say they have not been paid for work done on the project.

Labor Opposition Leader Mark McGowan questioned how Mr Day could give assurances that the government would get back the car park costs from John Holland.

He pointed out the similar issue at Fiona Stanley Hospital, where private contractor Serco was paid more than $100 million by the government while its opening was delayed.

“It is obscene that taxpayers are paying a fortune for a public facility that isn’t even operating,” he told reporters.

“A couple of years ago we were paying Serco for a hospital without any patients, now we are paying a fortune for a car park without any cars.”

He also pointed out that visitors to the new hospital such as the parents of sick children would be slugged with a five-fold increase in parking fees.

FavoriteLoadingsave article


 characters available
*Please refer to our comment policy before submitting
  1. Kenny

    An absolute disgrace – just further evidence of the slovenly practices rampant within the Australian building sector.

  2. Les Williams

    It should be incumbent on the WA government to pay subcontractors who have unpaid valid claims from their liquidated damages claims and settlement of final claims on this project. They engaged this building contractor for this site – now take responsibility for that appointment.. The WA Governments recent announcement that proposed PBA"s will only apply to government projects over $100 million is simply protecting Tier 1 contractors such as this contractor.. When will someone understand that insolvency is not the only non payment issue for subcontractors and suppliers. By far the wrongful withholding of money is the greatest cause of non payment in the industry. In the real world it is called stealing. It is time the government stood up for WA local businesses paid their claims and deleted this contractor from their future tender list for government work.