In short:

The appointment of former union leader Nicole Wells as independent chair of the construction industry's TasBuild long service scheme has riled up employer groups.

Independent MP Ruth Forrest has called for legislative reform to overhaul the governance of TasBuild.

What's next?

A government spokesperson says it is "aware of industry concerns about the operation of TasBuild and outdated governance arrangements" and is looking at "what can be done".

Tasmanian industry bodies are up in arms about the appointment of a former Fair Work Commission deputy president and unionist as independent chair of the construction industry's $258 million long service scheme, TasBuild.

Established in 1998, TasBuild collects 1.8 to 2.5 per cent of the weekly wages bill from registered employers in the construction industry to cover the portable long service leave entitlements of workers.

Appointed to the all-male board a fortnight ago, Nicole Wells was state secretary of the Communications, Electrical and Plumbing Union (CEPU) from 2010-12.

While she no longer holds any union office, her former role has led to concerns from industry over a perceived closeness to unions.

In a letter to Attorney-General Guy Barnett, who has oversight of TasBuild as consumer affairs minister, the Housing Industry Association (HIA) said it was deeply concerned the fund was "now effectively under control of the union movement".

HIA's Tasmanian executive director Benjamin Price told the ABC that "this new appointment stinks and it just doesn't stack up".

"We have a framework here that is meant to provide for an independent chair and a balance on this board that represents both employer interests and employee interests, and at the moment that's not what we're seeing."

The HIA called on the government to introduce legislation to reform the governance of the TasBuild scheme.

It wants a skills-based board appointed on merit by the minister, the scheme to be accountable to the parliament and a requirement for the treasurer to approve the investment strategy.

"The HIA has long expressed concerns with this archaic and outdated governance model," Mr Price told the ABC.

"We're calling on the attorney-general to urgently intervene and introduce a bill to parliament to fix this mess,"he said.

The Tasmanian Chamber of Commerce and Industry (TCCI) is represented on the TasBuild board and voted against the appointment of Ms Wells.

TCCI chief executive Colleen Reardon told the ABC: "We have concerns about the independence of this chair and we have raised these with the attorney-general."

Ms Wells was previously in a personal relationship with TasBuild director Kevin Harkins, who represents the Construction, Forestry, Mining and Energy Union (CFMEU).

Mr Harkins recused himself from the board decision due to the perceived conflict of interest and was absent from the meeting on October 15.

Instead, he appointed an alternate, Unions Tasmania representative Michael Anderson, who voted twice, as allowed by the Articles of Association.

In a written statement, TasBuild chief executive Mark Williams said Ms Wells was one of a number of well-qualified applicants in an open and rigorous recruitment process advertised widely through Seek and LinkedIn.

"Ms Wells brings significant governance, industrial relations and construction industry experience to the role,"Mr Williams said.

A spokesperson for Guy Barnett said the government was "aware of industry concerns about the operation of TasBuild and outdated governance arrangements and we are looking at what can be done to fix TasBuild's issues".

A valuable fund

TasBuild has grown rapidly in recent years, and the fund now controls $258 million according to the 2026 annual report released last week.

The TasBuild fund is now so valuable that other industries, including health and aged care, are proposing to expand the fund to cover long-service entitlements for short-term and mobile workforces.

Notwithstanding its past financial success, TasBuild has had a difficult year, recording an 8.4 per cent return in 2025-26 — down from 11 per cent the previous year — and an 82 per cent slump in operating profit from $11 million to just $2 million.

TasBuild's Mark Williams said the lower operating result primarily reflected increased worker entitlement costs following recent changes to the scheme rules.

The annual report showed that 2025-26 was the first year since the scheme's inception in which entitlement payments exceeded employer contributions, meaning more was paid out than was collected.

Millions spent on new TasBuild office

The HIA has also questioned the priorities of the TasBuild board, pointing to the more than $10 million construction of new office premises at 240 Murray Street, Hobart — to be called the "marching building" in celebration of the union movement heritage — which was approved last year and should be built in 2027.

HIA's Mr Price said the new office building was a gross misallocation of TasBuild funds.

"What we know is that the money held by TasBuild should be used for employee entitlements," he said, "but at the same time we have TasBuild progressing a substantial capital works program, building a new five-storey office accommodation for themselves in the CBD."

"They've lost the plot."

Under TasBuild's articles of association, the seven-member board is comprised of representatives from three unions and three employer groups, who together appoint a non-voting chair.

TasBuild told the ABC there was no requirement for the chair to be independent of unions or employer groups, although the role is described as independent in annual reports.

Previous TasBuild chairs included Rod Scurrah, a financial planner who was state president of the Liberal Party, and Susan Parr, a former chair of the TCCI.

Ms Parr stepped down in February and was replaced by acting chair John Mazengarb, a veteran business consultant and non-executive director.

Push for governance overhaul

In September, upper house independent Meg Webb criticised the TasBuild board for having no female directors, despite the state government's policy to have 50 per cent women on government boards.

"TasBuild may not be a state-owned business, but it is appointed by the government, and the Cabinet Handbook still details vacancy nomination processes for non-government organisations," Ms Webb said.

She said the position of chair of the TasBuild board was advertised through the government's own board vacancy channel and appointments submitted to cabinet should be accompanied by the required Tasmanian Women's Register Appointment Certification Form.

At the same time, fellow independent Ruth Forrest MLC called for an overhaul of the TasBuild legislation, which she said was no longer fit for purpose.

"Now, we expect a skills-based board," Ms Forrest said, adding "representative boards have gone by the wayside".

"There's a large body of money being held by an entity here with no public visibility or scrutiny over how that's expended."

Ms Forrest said the situation was similar to the Tasmanian Community Fund amendment bill which is before the Legislative Council.

"The only way to do it is through a legislative reform, and it's not a huge legislative reform. It's about setting up a proper governance framework and structure and having the board appointments made as a statutory authority rather than through a representative process where there is no oversight."

Governance expert Dr Rachel Baird, senior law lecturer at the University of Tasmania, told the ABC that almost 30 years after TasBuild was established, a review was "long overdue".

"I would expect that the Tasmanian government would want active oversight as sound risk management because if it is not well managed, the consequences are far too great," Dr Baird said.

"$258 million is a lot of long service money."