Large construction companies that don’t pay subcontractors will be banned from applying for government work, under beefed-up laws in WA.
Complaints about late and non-payments to subcontractors have been rampant in WA's building industry, with the troubled new Perth children's hospital a notable example this year with head contractor John Holland accused of ripping off small businesses.
A new code of conduct would apply to the building and construction industry from January 1 with a "Building and Construction Compliance Unit" to monitor compliance, the government announced on Monday.
"If there is egregious conduct, consistent bad practice, serious breaches then yes, the penalty may be you will not be able to tender for government contracts and get the benefit of public money for a period of time," Attorney-General and Commerce Minister Michael Mischin said.
The new code, changes to WA's Construction Contracts Act and the introduction of Project Bank Accounts would support small business, help prohibit anti-competitive behaviour such as price fixing and sham contracting and there was scope to sanction head contractors, Finance Minister Sean L'Estrange said.
The ability to impose fines is also being considered.