Following sustained pressure by the SEC Group, clients are starting to phase out the use of retentions. The Group has published a list of enlightened parties.

The Specialist Engineering Contractors' (SEC) Group has published a list of organisations that do not hold or are moving away from the use of retentions. The move aims to highlight the trend away from the practice.

The list of public sector bodies and private sector organisations comprises several big names including Vodafone, Toyota, the Prison Service, Defence Estates, BT and John Lewis. It is available to download as part of the SEC Group's Focus newsletter on its web site (www.secgroup. org.uk) and will be updated as more organisations are identified.

SEC Group has campaigned hard for the phasing out of retentions within construction. Its argument that they unfairly penalise small and medium-sized firms has been lobbied at government level and the formation of the list is evidence of the progress made.

The House of Commons Trade and Industry Select Committee supported this stance in both 2002 and 2003, recommending that government departments should set an example to other public sector construction procurers and the private sector by working to eliminate the practice of retention as soon as possible.

Guidance on retentions in construction contracts was issued in March 2004 by the Local Government Association/Federation of Property Societies (LGA/FPS) Procurement Panel. This was based on developing the long-term strategic relationships contained in Sir John Egan's Rethinking Construction report. The guidance also confirmed that retentions are an added admin cost to the client with no value added.

Contractors with knowledge of other firms working retention-free are asked to e-mail contact@secgroup.org.uk to add to the list.

Source

Electrical and Mechanical Contractor