16 May 2018

Ministry has multiple claims against troubled building company

9:21 pm on 16 May 2018

The Education Ministry has two other claims against a building company that is now caught up in a receivership.

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The leaking Botany Downs Secondary College. Photo: Google Maps / Screenshot

It is already owed $13.4 million by H Construction North Island for shoddy work at the leaking Botany Downs Secondary College that opened in 2004.

H Construction was part of major construction company Hawkins.

The Ministry said it was "considering the options available" now that the receiver for a related company, Orange H Group, was in charge.

It is further exposed because of the two active claims in the High Court against H Construction North Island.

The Ministry refused to say what those claims involved.

It would be working with Botany Downs over coming weeks on a long-term plan for fixing the school, it said.

"We hope to have had our position clarified over the coming weeks," said Botany board of trustees chair Murray Goodman.

Former Hawkins Group chief executive Geoff Hunt remains as the chair of the high-profile Construction Strategy Group (CSG) which often lobbies the government.

"I see my role as CSG chair as incomplete but, as always, if the members wish to replace me I will step aside," he told RNZ.

Hawkins also built four rotting hospital buildings at Counties Manukau District Health Board around the year 2000.

Mr Hunt had led Hawkins from 2013. When Hawkins was sold to Australian giant Downer last year, the rump of what was left behind, including some ongoing projects, was renamed Orange H Group.

Orange H was owned by McConnell Group, of which Mr Hunt was president.

Orange H has said it had been hit by a "dramatic rise" in how much risk it was forced to take on over building projects, which echoes what Fletcher Building said when it began the process of pulling the plug on its loss-making building unit in February.

"The issues that have impacted Orange H and other construction sector companies are the same issues that the CSG is working to resolve," Mr Hunt said in an email to RNZ.

How risks were being shared unevenly under building contracts was a "root cause of many industry issues", he said.

"It is encouraging that the current government does, at Minister level, have an understanding of the issues and an interest in tackling them."

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