Firms fail to meet pay obligations: Sargent

A NEW controversy over underpayment in the construction industry could have as far-reaching consequences as the Gama episode, Green Party leader Trevor Sargent claimed yesterday.

Mr Sargent was speaking as a convoy of construction lorries arrived outside the gates of the Dáil in Kildare Street, Dublin, as part of a protest against alleged underpayment to building subcontractors on local authority housing projects.

In all, representatives of 12 small companies protested yesterday. They contend they are still awaiting payment from the contractor companies.

Mr Sargent raised the matter in the Dáil yesterday, when he brought a motion seeking an adjournment debate on the controversy.

The Green Party leader told the Dáil that “a large construction company that has government contracts to build council housing in Ballymun in North Dublin, Fortunestown (near City West) and other places, has failed to meet its payment obligations to more than a dozen other companies that have subcontracted the work”.

He said one company was owed €374,000, and another was owed €254,000.

“This is resulting in a threat of job losses and companies going to the wall along with the associated tensions created with such non-payment of bills.”

He said there was a need for Government to make transparent and accountable its procurement procedures.

“We are beginning to see the effects of a large problem that the Government has covered up for many years.

“It’s a damning indictment of the failure of a Government when small companies who can ill afford to be left high and dry are owed hundreds of thousands of euro,” Mr Sargent said.

Representatives of the subcontractors told the Irish Examiner yesterday that long delays in payments and disputes over payments had left their companies in vulnerable financial positions.

The two principals of one company said that they had to rely on a loan from one of their own employees to tide them over in recent weeks because they were unable to pay the wages of workers.

The civil subcontracting company claims that is owed a total of €374,000 by the company overseeing the 110-unit local authority housing project.

“It is fair to say that our company is in serious financial difficulties because of this,” said one of the principals.