Lord Borrie slates government’s attempts to back fair deal for SMEs

The ex-director general of the Office of Fair Trading, Lord Borrie, has criticised the inadequacy of the Government’s response to his amendments to the Construction Act.

Lord Borrie expressed concern at the lack of government support for his amendments, given the government’s commitment to help SMEs during the recession.

His criticism was made in the committee stage of the debate on his amendments in the House of Lords. He has insisted that the government provides a more detailed account of its position in relation to the amendments.

Lord Borrie’s amendments to the Act are as follows:

• A single statutory adjudication procedure;

• Simplification of the payment process so that it is initiated by the payee (as in all other industries);

• A statutory period of time in which the payer can respond to the payee’s application;

• Complete abolition of pay-when-paid arrangements;

• The statutory right to suspension to be extended to the situation where a payer is unable to provide adequate security for payment.

Speaking after the debate, Trevor Hursthouse, chairman of the Specialist Engineering Contractors’ (SEC) Group, said: “I am delighted that Lord Borrie’s amendments have had their first hearing in the House of Lords. This represents the first round of the process and the amendments will continue to be debated in the remaining legislative stages in the House of Lords and, again, in the House of Commons”.

The amendments had been previously backed by Lord O'Neill of Clackmannan, but were withdrawn following allegations of cash for amendments. It was revealed that Lord O'Neill received a fee as president of the SEC Group.