Australia Day honours include the man behind the Security of Payment Act, a genuine hero for many contractors.
The recent honours list contained some extremely worthwhile recipients among the usual political gongs. Few are more deserving than Geoffrey Jochelson, who was awarded an Order of Australia Medal for service to the building and construction industry, particularly security of payment.
Jochelson has literally saved contractors around Australia billions of dollars in lost payments through his dogged work in the 1990s and since on solving the issue of construction payment disputes.
The 90-year-old is known for his genteel demeanour, as a hard-working professional and as an active member of his Sydney Eastern Suburbs community. But it’s his multi-decade work on securing contractor and subcontractor rights that has had the most impact.
As a boy in South Africa, he saw his father, an electrical contractor in Johannesburg, being bluntly told that he wouldn’t get paid for his work. Not once, but many times. At one point, his father took out an overdraft to make sure he could pay his subcontractors.
This injustice stayed with the young Jochelson, who went on to enjoy a successful career as an electrical contractor himself and then 17 years as the commercial manager for the National Electrical and Communications Association in Australia, as well as 11 years on the Adjudicators Forum, where he still assists the Australian building and construction industry.
In the early 1990s, he began lobbying the NSW state government for deemed trusts in the industry to ensure subcontractors would be guaranteed payment. He persisted through three different premiers, endless proposals, assessments, meetings and more, all around his full-time job.
At the end of 1999 it all paid off when the New South Wales Government passed the Building and Construction Industry Security of Payment Act into law. This is a statutory process where payment disputes get decided by an adjudicator in a rapid compulsory adjudication scheme that can go from a claim to a decision in only six weeks.
The Security of Payment system allows parties to bypass the lengthy and costly litigation route that forced many contractors to abandon the payments due to them, and to go into liquidation.
It was so successful in NSW that it was adopted by Victoria in 2002, Queensland in 2004, and by 2009 every Australian State and Territory. It also spread to New Zealand, Thailand and Singapore.
Over the last 20 years, over a billion dollars of payments have been recovered using the Security of Payment process.
Anthony Igra, managing director of Contractors Debt Recovery, one of Australia’s Security of Payment specialists said, “Geoffrey Jochelson’s work has effectively blasted a hole through the age-old roadblock facing unpaid contractors – no time and no money. Recovering disputed payments used to take months or years and cost a fortune in court proceedings. Geoffrey changed all that.
“Now a payment dispute can be decided in about five weeks at a tiny fraction of the cost. It’s not an overstatement to say that he single-handedly changed the face of construction cashflow around the entire country,” Igra added.
A very deserved honour, and one to which many of us should raise our hats!