Cade Lucas
A former employee of failed Point Cook builder, A1A Homes, has blamed the federal government’s Homebuilder scheme for its collapse.
The Homebuilder scheme was introduced by the then Morrison government to support the construction industry during the COVID-19 pandemic.
But Ajay Pasupulate, a former freelance sales consultant for A1A, said it had the opposite effect by overstimulating the market and forcing builders to expand ’too quickly’
‘It is the fault of the government 100 per cent“ said Mr Pasupulate of the company’s demise.
It was announced last week that A1A Homes and its subsidiary, A1A Commercial Builders, had entered administration on May 2.
Ajay Pasupulate worked at A1A between January and December 2021 and said it was during the second half of that year that he noticed something was wrong.
‘Initially we were doing around 50 houses per year, but it expanded by almost three times that in six months”
Delivering the same quality at below cost price became a problem when inflation hit and the cost of building materials skyrocketed.
Mr Paspulate said this was why some builders had begun charging extra fees before completing projects.
A review of the Homebuilder scheme by KPMG found over 100, 000 grants had been issued at a cost $2.3 billion, over three times what was originally forecast.
Mr Paspulate, who has since left the property industry, said A1A was far from alone in being damaged by the aftermath.
“All builders, big builders, small builders.”
Established in the early 2000’s and thought to have between 11 and 50 employees, A1A is the latest in a string of Australian home builders to collapse this year, following the likes of Porter Davis and Rawdon Hill.
In a statement, the Victorian Building Authority said it was responding to the situation.
“The VBA works with practitioners and building companies in external administration on a case-by-case basis.
Affected consumers are encouraged to contact the administrator.”
Kathleen Vouris and Richard Albarran from Hall Chadwick have been appointed joint administrators.
Hall Chadwick, A1A Homes and federal Housing Minister Julie Collins were all contacted for comment.
