Do more to protect against rogue contractors

I refer to the letter “Changes to consumer law will also better protect against errant contractors” (July 1). It is good that the Government is looking closely into this currently loosely-regulated industry.

However, owing to the various modus operandi and legal loopholes these rogue contractors can undertake and exploit, we need a more holistic and judicious framework to protect consumers better.

Besides the measures the Ministry of Trade and Industry has laid out, I have some suggestions. First, the Building and Construction Authority (BCA) or any other relevant government body should undertake an expanded regulatory, investigative and enforcement role.

The new guidelines could include companies and individual directors needing a valid licence. Companies and directors who have complaints lodged against them would be investigated, and penalties could include rescinding licences and accreditation, et cetera.

Companies should have to put up a performance bond, which would be a percentage of the project value, and adopt a standardised progressive payment schedule and contract terms, the templates of which are to be guided by the BCA.

Second, the BCA should set up a central repository where companies and consumers can both lodge and obtain information. Companies with any existing or previous injunction or legal proceeding taken against them should have to lodge this in the repository.

Company owners and directors should also have to lodge information on companies in similar industries they have been owners and directors of previously, and on any injunctions or legal proceedings against those companies during their tenure.

Third, business owners and/or company directors involved in any lawsuit and injunctions, or who have had a complaint lodged against them, should not be allowed to shut down their companies while these cases are outstanding. Those who do so and set up a new one should be charged with a criminal offence.

This is to safeguard against contractors dissipating assets from the troubled company to a new one in a bid to avoid compensation, should there be an unfavourable judgment against them.

Rogue contractors have abused legal loopholes while hiding behind the proverbial corporate veil, and continuing with their unethical, dishonest and irresponsible behaviour. The Government should hold a public consultation to specifically address this plague in the contractor industry.