'Restoring the Rule of Law' through Commercial (Dis)incentives: The Code for the Tendering and Performance of Building Work 2016

Abstract

This article examines the Australian Coalition Government’s attempt to restore the rule of law in the building and construction industry, through the procurement requirements in the Code for the Tendering and Performance of Building Work 2016 (Cth) (‘2016 Code’). It traces the evolution of the separate scheme of construction regulation adopted in 2005 following the Cole Royal Commission, the subsequent Labor Government changes to this scheme, and the initiatives of the Coalition Government since 2013. The article then considers the use of procurement guidelines to implement workplace reform in the construction industry since 1997, followed by a detailed explanation of the new procurement rules in the 2016 Code. The concept of the rule of law is examined as a basis for analysis of arguments in support of its reinstatement in the Australian construction industry. The article concludes that the Government’s use of the procurement rules in the 2016 Code is partly aimed at restoring the rule of law — narrowly conceived as ensuring compliance with the law — but is also a mechanism to reduce union power and enhance productivity in the Australian construction industry.

Keywords: Building work, construction industry, building unions, rule of law, Code for the Tendering and Performance of Building Work 2016 (Australia)

JEL Classification: K31