Construction Act: payment provision amendments 'costly and unnecessary'

The Construction Confederation has attacked plans to amend the payment provisions of the Construction Act.

The confederation believes the proposals announced by Gordon Brown this week are “are costly and unnecessary.”

Chief executive Stephen Ratcliffe said he will continue to fight for contractors’ interests when the  Draft Bill clauses are published for pre-legislative scrutiny later this summer.  

He said:  “While the Confederation has consistently been supportive of improvements to the adjudication provisions of the Act we have serious reservations about proposals to amend the payment provisions.

“We will need to look very closely at the detail but clearly if the Government is serious in its claim that it wants to reduce red tape and burdens on business, then any further regulation has to be fully justified. We have yet to see the case for this.

“We believe that additional legislation on payment terms will bring increased red tape and increased costs. That is why we have suggested the sensible route of improving guidance on existing legislation which delivers what the industry requires..

“Guidance could usefully be developed and published to identify best practice.  The OGC’s Fair Payment Charter is a good example of how the industry is addressing this issue as are the 2012 Olympic Commitments.

“The current Construction Act did have widespread industry support and it would seem to be a retrograde step to amend it with new provisions that do not enjoy an industry consensus.

“One important issue often overlooked is that those who choose not to pay will ignore legislation in whatever form it is presented – further regulation will serve only as an administrative burden to contractors who comply.”