All these companies are construction subcontractors or suppliers to the construction industry. Some of them I have known for many years and where long established second or third generation companies. Invariably their demise had been caused by the domino effect of a developer hitting the skids, the builder gets into cash flow problems and the subcontractor looses out. This despite the plethora of successive governments’ promises and legislation to protect those at the bottom of the development food chain.
Another, not so obvious reason, is the move to receivership to avoid owners personal liability for paying of owed superannuation to its employees. The law changed this year and now a company cannot simply go bust and the owners/directors walk away from what is owed in superannuation payments.
I picked up the paper the other day and realised I was owed, or at least my superannuation fund was owed, by some grub who I carried out some painful variations reconciliation. Yes they got paid their variations, I received some of my fee but my super is now in the creditors basket. Mind you with the recent returns on super it is no big deal. On the same page a family company started four generations ago had also gone down the proverbial gurgler. This company where a specialist subcontractor and I have had dealings with them for years in many reincarnations of my peripatetic career. These people where honest, paid their people (and their superannuation), mum answered the phone, dad did the quotes and the two sons carried out the work on site. The reason they went was because the aforementioned grub had not paid them $500K. They have lost everything, income, houses, the whole box and dice.
I saw the grub last night parking his new AMG SL outside our local bottle shop.