Builders facing ‘triple threat’ from fuel spikes

BUILDERS say they are under pressure from a ‘triple threat’ caused by spiking fuel prices.

Matthew Pollock, Executive Director of Master Builders NSW, said builders are increasingly feeling pressure from fuel price rises from a triple pain point perspective.

1. The cost of keeping diesel-fuelled commercial vehicles and equipment operating and getting to site.
2. Rising transport costs causing cost rises from getting products and services to sites.
3. Building products cost increases and supply chain uncertainty.
   Master Builders NSW has strongly backed the NSW Government’s move to step up monitoring and coordination across the fuel supply chain in response to spiking costs and localised shortages.

“The Premier’s announcement of a Liquid Fuel Emergency Operations Centre to monitor fuel availability and shortages and to work with industry to coordinate fuel availability will give some comfort to builders that the government has its eye on what could be a worsening situation,” Mr Pollock said.

“The Premier has recognised the importance of the construction sector in announcing that the new fuel monitoring centre will identify supply chain pressure points and supply needs for our industry.

“Construction is an essential industry which is vital to keeping the economy going strong.

“We can’t afford to have the $100 billion in construction activity that’s under way in NSW grind to a halt due to fuel shortages,” he said.

Mr Pollock said major pain points are already emerging.

“Building firms are the canary down the coalmine of inflationary pressures like fuel price spikes.

“Builders are hit by input cost increases earlier and feel the effects for longer than most other industries.

“Right now, suppliers are putting fuel levies on the back of quotes to transport materials to and from sites.

“Examples include heavy materials, skip bins and demolition – they all come and go on the back of a diesel truck.”

Noting that a scarcity of diesel is a “big risk” for the industry, Mr Pollock said builders would be looking for further government intervention if prolonged shortages were seen.

“It’s hard to point to a building material or a construction site that isn’t somehow exposed to diesel prices.

“The Minns Government will want to avoid delays in the construction of essential community infrastructure projects including the more than 100 healthcare and medical facilities being built in cities, towns and regional centres across NSW.”

Last week the NSW Government announced two measures to strengthen coordination of the fuel supply chain.

Firstly, Energy Minister Penny Sharpe will compel major fuel companies to provide information on their plans for supplying additional fuel, particularly to regional communities.

A Liquid Fuel Emergency Operations Centre in Parramatta has also been established.