SEC calls for retentions peace deal

The Specialist Engineering Contractors (SEC) Group is looking to broker a peace deal with central government over its position on retentions.

SEC Group chief executive Rudi Klein told CJ: "We are building good relations with construction minister Nigel Griffiths and it seems silly to fight tooth and nail to make sure all of central government's 180 departments phase out retentions.

"We have decided to call the dogs off and reach a compromise. However, we will be looking more closely at local authorities as most of them still go for lowest cost and use adversarial JCT contracts."

The SEC Group is expected to agree next month with the government that although the organisation accepts that not all departments will phase out retentions by 2007, those that still hold back payments to subcontractors must ring-fence retentions monies and ensure that main contractors pay their suppliers as soon as work is finished.

At the latest trade and industry select committee hearing, the Office of Government Commerce and the Department of Trade & Industry refused to completely phase-out retention use by the SEC Group's target of 2007.

However, both departments must report to the committee on the Achieving Excellence 2005 target of 70% of projects to be delivered defect-free and on time and to budget.