State Member for Wallsend Sonia Hornery raised the motion which called on the Minister for Fair Trading and Small Business to assist the victims of Privium to get some certainty, ensure these investments can be protected, and they can have their homes completed.

The Herald reported in November that building company Privium Homes went into voluntary administration, leaving would-be home owners, sub-contractors and suppliers in the lurch and houses unfinished.

Ms Hornery's submitted the motion late last year following the company's collapse, which affected people across the Wallsend electorate and the wider Hunter.

The MP said she would work with the government to ensure protections are in place so that "future events like this don't happen, and if they do, that people are not left out of pocket".

"I welcome the support of the government on this very important issue," Ms Hornery said.

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"I have spoken with people who were victims of the Privium home collapse, people who had invested every cent they had into building their new home, who have been left financially ruined by the collapse of the company.

"I will now work with the government and the minister to ensure protections are put in place for consumers."

Upper Hunter MP Dave Layzell, a former construction manager, said in parliament the Privium situation was something that unfortunately happened "far too often in the construction industry".

"It particularly hurts when those companies go under because it affects families and people who have invested everything they have into the home they are building, which is their greatest investment," he said.

"Extra special care and support is required when those companies go under. The collapse of Privium Homes has had particularly far-reaching implications. We have seen a huge building boom across Maitland and the western parts of Newcastle as the population has exploded.

"I commend the member for Wallsend for raising this issue and bringing the motion before the house. We know real people are hurting in this situation, and the government's role is to support governmental departments supporting those who have been impacted."

Maitland MP Jenny Aitchison said the NSW Premier should address icare to make sure it is a "fit-for-purpose vehicle for people to protect their assets, their life's work towards getting a new home".

"These people have our sympathy," she said. "But they deserve more than sympathy. They need more than thanks. More than anything else that the government can give them, they want to know what they can do to ensure the house of their dreams can be completed."

The state government came under fire in the wake of the news for failing to implement recommendations which came out of an independent inquiry into construction industry insolvencies in 2012.

The Collins review made 44 recommendations to improve protections for those impacted by construction industry insolvencies, key among them that money be held in trust so that the ripple effects can be contained.

At that time, ten of the recommendations were supported, 13 were not, and the others were given in-principle or qualified support.

"There are recommendations from the Collins review that should be implemented that would minimise the loss caused by collapses," Ms Hornery said.

"I want the minister to take action, to look seriously at these companies and to prevent it from happening in the future, so we can protect our communities, and I will be making sure the government follow through."

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