Construction Industry Crisis - Unemployment and Bankruptcy

[C. Flower]

Construction industry employment has contracted from 280,000 down to about 130,000 people and is expected to shrink a lot more with the end of the big road schemes this year.

The people worst hit have been subcontractors - no NAMA for them and they are the first people not to be paid, after they have carried the cost of the project.

Feargal Quinn has brought a Bill to get greater protection for subcontractors.
http://www.kildarestreet.com/sendebates/?id=2010-05-19.208.0

The Pat Kenny Show is discussing the construction sector now - the quesion is being asked whether we shouldn't be building necessary infrastructure now, when costs are low, rather than waiting to do it in a future upturn, should one ever come.

Should we be borrowing to pay people unemployment benefit, or to build ?

[C. Flower]

Man phones in - owed 12,000 by a contractor - owes 10,000 in tax. He is on Welfare (with children) and the Revenue is taking 50 euro a week off him for the tax.

[Fing Fers]

Man phones in - owed 12,000 by a contractor - owes 10,000 in tax. He is on Welfare (with children) and the Revenue is taking 50 euro a week off him for the tax. My old man had same kind of prob, being owed for jobs led to a Revenue problem, the figure was peanuts but still led to two Gardai calling around, prob cost more to pay the Gardai for the trip than the amout owed to Revenue.

When you build a house for someone yet they dont pay you cant really take the house off them, laws of construction are crazy, lost count of the amount of times I've seen and heard about people being shafted after works finished. When matters go to court all the builder gets is a rentention or something, they'll only see money if house sold, might never be sold?

You walk into a shop for a Mars bar, you have to pay for it before leaving, same should apply for building. Ireland is a crazy place.

[C. Flower]

My old man had same kind of prob, being owed for jobs led to a Revenue problem, the figure was peanuts but still led to two Gardai calling around, prob cost more to pay the Gardai for the trip than the amout owed to Revenue.

When you build a house for someone yet they dont pay you cant really take the house off them, laws of construction are crazy, lost count of the amount of times I've seen and heard about people being shafted after works finished. When matters go to court all the builder gets is a rentention or something, they'll only see money if house sold, might never be sold?

You walk into a shop for a Mars bar, you have to pay for it before leaving, same should apply for building. Ireland is a crazy place.

There's a lot of sense in the Bill. Its worth a look at the link.

[Fing Fers]

There's a lot of sense in the Bill. Its worth a look at the link. Must check it out, might be a bit much to take in tonight, who came up with the bill, hardly FF?

[C. Flower]

Must check it out, might be a bit much to take in tonight, who came up with the bill, hardly FF?

Feargal Quinn. Maybe he's got family members in the business.

[Fing Fers]

Feargal Quinn. Maybe he's got family members in the business.

Whos Fergal Quinn? If he's FF then this bill is only out to suit himself not others, prob his sideline business or relative got shafted so only now do they look into it, always the same story here, nothings fixed until its broken. Chancers running the show, all in all would be good to see some measures to prevent shafting.

[ang]

Feargal Quinn Independent Senator cousin of Ruairi Quinn

[C. Flower]

There are all sorts of people in construction. Most are construction workers doing hard and dangerous and often skilled work. A subcontractor who was a bad employer wasn't going to survive long in the boom when getting a good team together and keeping it was difficult. Quinn describes the devices used by developers to maximise their personal gain and minimise their risk. Not all did this, and some "developers" were builders by trade. There are people who were NAMA'd who are back laying blocks. The subcontractors were worst off because not only are they unemployed and not eligible for benefits but a lot of them have tens of thousands of debts because of not being paid for works they did.

[Fing Fers]

There are all sorts of people in construction. Most are construction workers doing hard and dangerous and often skilled work. A subcontractor who was a bad employer wasn't going to survive long in the boom when getting a good team together and keeping it was difficult. Quinn describes the devices used by developers to maximise their personal gain and minimise their risk. Not all did this, and some "developers" were builders by trade. There are people who were NAMA'd who are back laying blocks. The subcontractors were worst off because not only are they unemployed and not eligible for benefits but a lot of them have tens of thousands of debts because of not being paid for works they did.

Not sure what you mean by sub contractors? From my days the people who are hit the most is self employed trades people, plumbers, sparks, chippys, plasters, block layers and so on. The ones who are hit the most is last on the job ones like plumbers and sparks, tilers, kitchen fitters etc. Most cases homeowners blow the mortage on the building then bluff their way to complete house, they spin all sorts or yarn saying mortage hold ups and so on when really they didnt do any homework, by then its too late, those self employed trades people who've been hit cant really take the stuff back, yet they in most cases bought it. This problem is rife all over Ireland, all you have to do is take a drive around, houses all over partly finished, no drives or landscapes, no boundary wall etc, just strange unfinished looking houses.

Big diff in 80's to 90's houses, they were all pretty much finished before the homeowner even moved in.

[C. Flower]

A subcontractor might have employed one or two or twenty people. They would have bought equipment and materials and paid on completion - or not as the case may be.
So they are not only unemployed but also in debt up to the ears in many cases.

Self employed (one person) builders are also in a very bad situation.

[Fing Fers]

A subcontractor might have employed one or two or twenty people. They would have bought equipment and materials and paid on completion - or not as the case may be.
So they are not only unemployed but also in debt up to the ears in many cases.

Self employed (one person) builders are also in a very bad situation.

I get you now, thats what I mean, most self employed have a few staff, wages still have to be paid along with materials. I think the difference in a contractor over a self employed person is the tax cert, some work off C2 while others work off different system. Most now in construction ask for materials cost up front, lessons learned.

Its bad when their is trades men / women in debt, no income and no future in construction. Whats being done about it....

[C. Flower]

I get you now, thats what I mean, most self employed have a few staff, wages still have to be paid along with materials. I think the difference in a contractor over a self employed person is the tax cert, some work off C2 while others work off different system. Most now in construction ask for materials cost up front, lessons learned.

Its bad when their is trades men / women in debt, no income and no future in construction. Whats being done about it....

A man on the radio said he's on welfare and must pay 50 euro a week to the Revenue although he's owed thousands by developers.

Getting help from families, emigrating, in psychiatric hospital some, according to the news last week.

[Fing Fers]

A man on the radio said he's on welfare and must pay 50 euro a week to the Revenue although he's owed thousands by developers.

Getting help from families, emigrating, in psychiatric hospital some, according to the news last week.

I'd say he's not alone, slowly but surly people will start waking up, their is only so much the TV and papers can mask up, more and more we hear the horror stories outside of state broadcast, its all word on the street / decent forums and radio stations, cant wait for the day.

[C. Flower]

The banking crisis has preoccupied us so much that the parallel construction collapse that triggered it has not got as much attention.

In the last week or two a number of very prominent businesses have folded. In the SBP (page 3) its reported that

1. The AIB is taking a High Court action against Cork's John Fleming, in relation to 300 million euro guarantees. Fleming has "contingent exposure" of 1.8 billion. "A scheme of arrangement" was turned down by the Supreme Court. Flemings loans are due to be transferred to NAMA next month.

2. The INBS has seized the Moyvalley hotel and golf resort, said to be worth 60 million and also the New Forest Golf Club, owned by Essada, (Alastair Jacksons firm).

3. Last week the Heritage hotel and golf club said to be worth 100 million went into receivership.

4. Shovlin/ Landmark Developments, who built the Beacon and other apartment developments in Sandyford, which also involves Derek Quinlan is going into receivership. No sum of money is mentioned.

[disability student]

It's very common as i have some relatives who worked for the subcontractor/developers. I'm glad that this one came into light as it would take a very deep look at the construction industry itself and their suspect practices which was very dodgy at least.

For example, note that this was not the first time as they did before with a ' staged' payments before it was banned.

So It would need a stronger & stiffer legalisation as regards to the suspect practices in the Construction industry.

[C. Flower]

Tonight with Vincent Browne is discussing the position of bankrupt developers.

[5intheface]

I'm a sub-contractor myself. Plenty of work but almost impossible to get paid. Them with nothing won't let you leave without the money but the contractors? I daren't risk even doing work for them, they'd happily put my lights out just to keep them in the luxury the've become so accustomed to.

One decent, smallish contractor told me recently that he has to insist on a letter from a customer's Bank Manager before he'll lift a shovel.

[C. Flower]

I'm a sub-contractor myself. Plenty of work but almost impossible to get paid. Them with nothing won't let you leave without the money but the contractors? I daren't risk even doing work for them, they'd happily put my lights out just to keep them in the luxury the've become so accustomed to.

One decent, smallish contractor told me recently that he has to insist on a letter from a customer's Bank Manager before he'll lift a shovel.

Is that worth the paper it's written on these days ?

Jim Mansfield's City West Hotel has gone into receivership.
Always looks busy enough, close to Dublin and cheaply built.

180 million adrift, I think I heard.