The Queensland government has committed to significant reforms across its construction industry following an inquiry by the state's productivity commission. The commission's final report identified a substantial decline in industry productivity and proposed measures to address the state's growing housing demand.
Report Findings
The productivity commission's report revealed that construction industry productivity has fallen by approximately 9 percent since 2018. This decline is estimated to have resulted in a shortfall of nearly 80,000 additional homes. Over the past three decades, labor productivity in the sector, which employs 10 percent of Queensland's workforce, grew by only 5 percent, in stark contrast to the 65 percent growth seen in the broader market economy during the same period. The report concluded that the industry is struggling to meet demand, making government housing targets increasingly difficult to achieve.
Government Response and Agreed Reforms
The Queensland government has agreed or signaled in-principle agreement to 51 of the 64 recommendations put forth by the commission, which called for an "industry reset." Key reforms include:
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Procurement and Conditions: Permanently abolishing Best Practice Industry Conditions (BPIC), which previously dictated pay and conditions for construction union workers on major state projects costing over $100 million. This move, initiated by a pause in late 2024, was intended to save taxpayers billions but drew criticism from unions. The government will also aim to reduce red tape in procurement processes, emphasizing "value for money" and administrative simplicity.
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Workforce Development: Reviewing available training courses, introducing targeted policies to boost apprentice numbers, progressing Queensland's participation in the Automatic Mutual Recognition scheme, streamlining licensing for migrants, and advocating for an increased allocation of skilled overseas migrants. The requirement for subcontractors to be pre-qualified for government construction projects has also been removed, a change intended to open opportunities for 99 percent of previously excluded subcontractors.
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Health and Safety: Reviewing health and safety regulations, including mechanisms for resolving workplace health and safety disputes and the use of right-to-entry provisions on worksites. The commission noted a "cultural problem" within parts of the industry regarding the use of safety provisions for "alternative objectives." The government also agreed to review the creation of a policy for managing adverse weather events, such as extreme heat, though the opposition criticized these changes as potentially weakening worker safety protections.
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Planning and Zoning: Agreement to increase zoning around transport hubs in south-east Queensland and review the multi-billion-dollar capital works program, which includes projects related to the 2032 Olympic Games. However, several zoning recommendations, such as statewide overlays for flooding and bushfires, removing character zoning, a statewide digital planning portal, housing incentives across local government areas, and independent planning panels, were either noted or not progressed, with the government citing conflicts with commitments to local government planning partnerships or existing duplicative processes.
Housing Targets and Industry Reaction
Housing Minister Sam O'Connor reiterated the government's commitment to its infrastructure pipeline and its target of delivering one million new homes by 2044, including 53,000 social and affordable homes. He identified productivity issues in construction as the primary impediment to home ownership and housing delivery. Industry bodies, including Master Builders Australia and the Civil Contractors Federation Queensland, generally welcomed the government's response, acknowledging the renewed focus on productivity, though some expressed that certain "noted" recommendations should have been fully accepted to maximize impact.