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Brownlee calls for calm after Mainzeal collapse

Thursday 7 Feb 2013 10:31 a.m.

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By 3 News online staff and NZN

Earthquake Recovery Minister Gerry Brownlee says although from a “New Zealand-wide perspective” the collapse of the company Mainzeal is disappointing, it will not affect the Christchurch rebuild as badly as many people fear.

Yesterday the country’s third biggest construction company announced it went into receivership, sending shockwaves throughout the industry.

Among the contracts the company had in Christchurch was the demolition of the Clarendon Towers and the QE2 Stadium, and Mr Brownlee says it is important for the receivers of the company – PriceWaterHouseCoopers - to quickly indicate what they intend to do with the firm.

“We’ll need to work out who’s been paid for what so far and try and get a picture from the receivers about their intentions,” says Mr Brownlee, speaking to Firstline this morning.

He says he is concerned there will be a knock-on effect for smaller contractors.

“I want to see sub-contractors paid because they’re the people who are providing a great deal of employment down there, and they’re generally smaller business operators who don’t have the capital backing that would be able to see them through.”

Despite the collapse, Mr Brownlee says he is confident that many who lost their jobs at Mainzeal will find new jobs within the industry, and that as a whole the Christchurch rebuild will not suffer too many setbacks resulting from the company’s failure.

“As the rebuild really starts to wrap up, and we’re only just seeing the beginning stages of that now, there will be massive opportunities for the people in the construction field, so I’m pretty disappointed to see a company like this fail – from a New Zealand-wide perspective – but I don’t have the concerns about Christchurch that some others might immediately leap to.”

Around 400 people were employed by Mainzeal and it is thought that pay disputes and the cost of repairing leaky homes contributed to the company’s collapse.

3 News/NZN

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