Pindan scandal: Collapse of builder to hurt many Mid West tradies

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Geoff VivianGeraldton Guardian
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Pindan contracted a Carnarvon-based team of five to do all of the maintenance plumbing on Department of Housing properties in the Gascoyne and Shark Bay. Apprentices Riley Schmidt and Jai Lawer, licensed plumbing contractor Warren Schmidt, and tradesmen Kieran Hutchinson and Joby Mallard.
Camera IconPindan contracted a Carnarvon-based team of five to do all of the maintenance plumbing on Department of Housing properties in the Gascoyne and Shark Bay. Apprentices Riley Schmidt and Jai Lawer, licensed plumbing contractor Warren Schmidt, and tradesmen Kieran Hutchinson and Joby Mallard. Credit: Warren Schmidt/Supplied, Warren Schmidt

A Geraldton builder has spoken out about his hope to trade his way out of a potential $250,000 loss after the collapse of building giant Pindan this week.

The builder wanted to remain anonymous to avoid hurting his reputation with suppliers and contractors, amid the fallout caused by Pindan going into administration.

The WA company owed up to $100 million, including an estimated $30m to subcontractors and $10m to staff, and administrators laid off almost half of the stricken builder’s workforce.

Most of the Geraldton builder’s work this year has been with the WA Government’s social housing economic recovery project, administered by Pindan.

“We are caught at the moment with a heap of projects halfway through and close to being finished,” he said.

These included 16 government houses being repainted and three $100,000 refurbishments, of which only one had been handed over and paid for.

He said he employed a painter, a plumber, an electrician and roofers who all had to be paid.

“These people not being paid means not feeding their families,” he said.

“The Premier says there is plenty of work but when you can’t afford to buy more materials and pay your people it’s pretty hard to get more work.

We are still holding out some hope the Government is going to come good.

Pindan has a $35m annual housing maintenance contract for Geraldton, Carnarvon, Meekatharra, Karratha, Hedland and Newman.

Warren Schmidt, who was the company’s plumbing subcontractor for the Gascoyne and Shark Bay, said the company owed him more than $100,000 and he now had to deny an essential service to tenants.

“You feel like you let the team down but I can’t keep trading and let it run into hundreds of thousands,” he said.

Because Pindan have gone down, blocked toilets don’t stop, gas leaks don’t stop, burst water mains don’t stop.

Mr Schmidt said he should be able to keep trading because he had paid all his bills and all of his contracted maintenance work was up to date.

Geraldton Grammar School principal Neesha Flint the worst that could happen was the school gym project being delayed, but she felt for sub-contractors who had not been paid. File picture
Camera IconGeraldton Grammar School principal Neesha Flint the worst that could happen was the school gym project being delayed, but she felt for sub-contractors who had not been paid. File picture Credit: Tamra Carr/Geraldton Guardian

However, he said other subcontractors he knew would not recover.

The slab has been poured and steel partly fixed for Geraldton Grammar School’s new $6.27m gym, which Pindan was due to complete by the end of this year.

Principal Neesha Flint said the project could now be delayed by several months.

“The school has the money to pay for the gym so if Pindan won’t finish it we will pay someone else to finish it — we have somebody in mind all ready to go,” she said.

I feel for all the subcontractors who have money owing to them.

“The worst thing that will happen to the school is that it will set us back time wise.”

Ms Flint said it was likely the building would not be ready for the school’s 25th anniversary celebrations later this year.

A spokeswoman for Pindan’s administrators said about 1400 creditors were owed about $80 million.

“There are approximately 500 sub contractors and 400 suppliers,” she said.

“It is early days, so too early to predict outcome but there is very little funding available which is a challenge for completion of projects.”

Shadow commerce minister Vince Catania called on the Government to urgently act on a 2017 State election promise and introduce greater protections for subcontractors.

He said the collapse of Pindan Group reiterated the need for protections to be in place to ensure subcontractors received payment in the event of head contractor insolvency.

Mr Catania called for the Government to urgently introduce legislation to Parliament to establish cascading trust funds to protect subcontractors.

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