Transfield to pay NZ contractors

Transfield says it will play the New Zealnd contractors within 2 days.

Australian company Transfield Services (TSE) says it will pay its New Zealand sub-contractors working on New Zealand's ultra-fast broadband rollout within two working days.

The company says it has already paid a third of the outstanding amounts and will be telling the other sub-contractors on Friday when they will receive payment.

Transfield has a 10% share of the New Zealand government's $NZ1.3 billion ($A1.13 billion) UFB rollout.

It hired dozens of New Zealand subbies to dig ditches and lay cables, but work has ground to a halt and workers have been laid off because no payments were received for several weeks.

NZ Communications Minister Amy Adams put pressure on the company to meet its commitments, saying last night it should pay the subbies as quickly as possible.

Transfield's chief executive Nicholas Yates hasn't explained what went wrong but says it has "found a solution" to the problem.

"We're concerned and disappointed it has escalated to this level," he said.

"We apologise for the disruption caused."

The situation became confused over the last 48 hours with reports that Transfield had told some subbies to suspend work because further design work was needed on ducting pipes.

That was disputed by Christchurch company Enable, which is doing the design work for the rollout.

It said Transfield had nothing to do with design and there were no reasons why cable laying should be suspended.

Paul Brislen, chief executive of the Telecommunications Users Association, said he believed cost overruns could be the problem.

"That seems to be at the heart of the matter right across the UFB deployment," he told Radio New Zealand.

"What it boils down to, as far as I can tell, is under-bidding for a contract you know you can't fulfil but because it's a government initiative you can go back cap in hand and ask to be propped up."

The issue reached parliament yesterday, with Labour's communications spokeswoman Clare Curran saying the government should be more hands-on.

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