During the summer, the industry has been contributing to the DTI’s review of the Construction Act.

While generally a success, the Act has failed to achieve one of its main purposes: establishing with certainty and within a reasonable period of time, how much will be paid for work completed.

It should not be difficult to achieve payment certainty. The Act should allow a contractor the right to make a payment application and the client a specified time to respond. After that, the application, with any amendments, becomes a debt due. If the client does not pay, the contractor has the right to pursue it in the usual way.

Other matters highlighted with the DTI include the unfairness of pay-when-paid clauses when an upstream party becomes insolvent, and the legislation only applying to written contracts. There is no apparent reason why all contracts should not be subject to the Act.

The DTI is now considering these and other suggestions and is expected to issue an interim report later this month and firm proposals early next year. The review offers the opportunity to make real changes and any lobbying you can do with your MP, giving evidence of payment abuse, will help to achieve those changes.

Source

Electrical and Mechanical Contractor