Monday, August 06, 2018

Just wrong

A couple of years ago, Fonterra was publicly castigated for using its market power to unilaterally decide that it wouldn't pay its contractors for two months after invoicing - effectively, extorting a free loan from them. The problem is widespread amongst New Zealand businesses, and is a significant drag on the economy. But we'd expect the government to be better than that, right? Wrong:

The Ministry of Education is being blamed for a badly leaking Auckland high school and for changing contracts so that builders can wait up to twice as long as usual to get paid.

The construction industry is holding these up as examples of government behaviour that's undermining builders even as some go to the wall.


The Education Ministry is also facing criticism from builders who have complained that it has changed a contract so they can end up waiting a whole month longer for payment than before.

Contract mediator Peter Degerholm said a medium-sized contractor came to him, confused over a claim he expected would be paid on 20 June, but has been told would be paid on 20 July.

The payment delay clause was hard to decipher, Mr Degerholm said, but he advised the contractor this was what he had signed up for.

We expect the government to work hard to get value for money in its contracting. But late payment isn't about value-for-money - its fucking people over for the sake of it. There's no benefit whatsoever to the public in doing this, and insofar as it puts the survival of contractors at risk, significant negative effects. But more importantly than that, its just fucking wrong. When people do work, they shoudl be paid, on time. The government should be setting an example on this, not adopting dodgy foreign business practices whose sole purpose seems to be to screw people over.