NBN construction pay rates 'extremely poor': NSW Business Chamber

NBN construction pay rates 'extremely poor': NSW Business Chamber

Summary: The New South Wales Business Chamber has said that it has received complaints from NBN contractors over the pay rates for constructing the fibre network.

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TOPICS: NBN
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The New South Wales Business Chamber has told a parliamentary committee looking into the rollout of the National Broadband Network (NBN) that contractors have complained to the chamber over the "extremely poor" rate of pay.

"The chamber has, however, received a number of complaints from contractors in relation to the NBN Co cabling tender process, and the poor logistics capabilities of some companies that have signed individual contracts with the NBN Co," the chamber said in its submission.

"One particular contractor from the Sydney region advised that since the cancellation of the cabling tender process more than 18 months ago, there has been extremely poor rates of work for contractors, as well as a lack of communication between the NBN and contractors about when work opportunities of this nature will actually be made available."

The comments align with the comments made by subcontractors late last year that NBN Co fibre network construction contractors Syntheo and Silcar were paying as much as 75 percent less than the current going rate for cabling jobs.

The Australian Financial Review also reported in February that internal documents it had obtained from NBN Co showed that the going rate for NBN contracts to install cables or new pipes were up to 75 percent less than the current market rate.

An NBN Co spokeswoman told ZDNet that the company negotiated value-for-money contracts with its construction partners, with an eye for the subcontracting deals that would also have to be arranged.

"These agreements were reached after extensive national and international benchmarking of costs for similar construction projects to arrive at a fair balance of risk and reward. These contracts were developed conscious of the need for further sub-contracting arrangements," she said.

"We rely on our construction partners to manage their sub-contractor arrangements fairly and reasonably."

The chamber also claimed that Telstra was "selling off its exchanges to the NBN Co with no stop gap before the rollout of the NBN in 2015". Telstra leases space to NBN Co, but the original copper network remains in place for 18 months after an area is declared ready for service on the NBN.

The chamber claimed that because Telstra had put off doing any ADSL upgrades to those areas, one town, Wauchope, had no additional ADSL ports to get services and were forced to instead use wireless.

"NBN Co should be considering appropriate transition mechanisms in these circumstances to ensure service continuity for users."

The chamber said that the NBN is "a critical infrastructure project" for Australia and a high-priority development, but some of the 12,000 businesses the chamber represents were said to be disappointed at the slow pace of the rollout.

"However, part of this frustration with delays may also be due to the keenness of businesses to get connected as soon as possible," the chamber said.

Difficulty with getting construction workers for the project as quickly as required last month forced NBN Co to revise down its forecast for the number of premises it will pass by the end of June 2013 from 341,000 to between 190,000 and 220,000.

Topic: NBN

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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13 comments
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  • According to Conroy

    the NBN is only 3 months behind schedule as a consequence of the cabling contracts issue, and that will be made up before 2015. I can't see it happening. They went to tender for contracts and didn't like the prices so they simply decided to pay less. Now they wonder why they're finding it hard to recruit people to do the work.

    Maybe 457 visas will be their saviour?
    Fred Fredrickson
    • Labor no longer likes foreign workers (xenophobia latest election strategy)

      From article:

      "forced NBN Co to revise down its forecast for the number of premises it will pass by the end of June 2013 from 341,000 to between 190,000 and 220,000."

      Actually that was the second revision. The first plan said they'd passed 1.3 million premises by that date. The full comedy should be exposed. It's a disaster.
      Richard Flude
      • Thank you Dick...

        Now back to counting cars... ooh look there's another, it's a Camry... good boy.
        RS-ef540
        • Dont sweat it RS

          Doesn't matter what or who causes the hold-ups for NBNCo (greedy private enterprise in this case), Richard would always be against the ALP NBN, because it's ALP, there is literally nothing NBNCo could do that would make people like him happy apart from cancelling the project.
          Tinman_au
        • Another day fighting the battle again for the NBN? Your medal's in the post

          10 minutes to reply - come on now, that’s really slack by your standards. I'd let you off if you were funny... been busy on other forums have we?

          I'm sure you will get the NBN soon enough to pirate those movies your dying for..

          Cant wait for your reply (Tinman_au, Karl or.... ) its going to hilarious - your time starts now.
          sparky_l
          • Oh look...

            I must apologise I missed this, sorry tiger.

            As your hero whom your scour the web for, I don't like to let my fans like you down.

            Thank you for your input...
            RS-ef540
      • Just the Two of Us

        Hiyah Fludie o'l Pal, nice to see a fellow Troll on here!
        Sultanabran-
  • Hmmm and number of interesting points...

    "network construction contractors Syntheo and Silcar were paying as much as 75 percent less than the current going rate for cabling jobs"

    So is it NBNCo not paying enough or these companies scraping the cream and leaving little for their workers?

    Also... the Business Chamber who normally oppose pay rises, talking of under-paying, but also saying how they all can't wait for the NBN...
    RS-ef540
    • Yes I wondered about that!

      "Also... the Business Chamber who normally oppose pay rises, talking of under-paying"
      First time ever I've heard the Business chamber say something like that! Wonder what there angle is?
      martin_js
  • Raises an interesting question,

    If NBNco subcontractors are paying as much as 75% less than the going rate then I'd be pretty pissed off If I had payed for a green fields install to a private contractor.
    I haven't seen any starving cable pullers on ACA or TT.
    ravsta
    • Sorry

      Forgot to add the question, How many people paid for a private contractor to install cable in a green fields estate?
      ravsta
  • Naturally they want to be paid more

    Who wouldn't?

    Who would like to have guarenteed work for the next 9 years?
    Paul Krueger