Fighting Corruption in the Australian Construction Industry: The National Code of Practice

Abstract

The Australian building and construction industry has experienced its share of bad and anti-competitive practices, especially related to industrial and workplace practices and to occupational health and safety. As a result, the commonwealth (federal) and state governments agreed in the early 1990s to adopt a National Code of Practice for the Construction Industry to establish a set of principles and standards of behavior that would apply to all dealings between clients, their representatives, and members of the construction industry. The code applies to construction activity and building refurbishments and extends to clients, head contractors, subcontractors, project managers, consultants, material suppliers, and trade unions. All parties wishing to do business with governments or work on government construction projects must be compliant with the code. Sanctions may be imposed where a party fails to meet its code obligations and sanctions may range from a warning to preclusion from bidding on government work for up to six months. The code has set clear and firmly enforced ground rules regarding expected behavior and standards on construction projects and appears to have been successful, with measurable decreases in unacceptable practices such as collusive tendering and increases in productivity for the industry as a whole.