Tesot refrigeration
SEARCH

Impending Bill to hold retentions in trust

A forthcoming parliamentary Bill on retentions is to be backed by the Building Engineering Services Association (BESA) and the electrotechnical and engineering services body, ECA.

The Ten Minute Rule Bill, to be introduced by Peter Aldous MP, will seek to amend the 1996 Construction Act and ensure that retentions within construction are held in a third party trust scheme. A key aim will be to help protect companies in the construction supply chain from insolvency and payment uncertainty.

The first reading of the Bill in Parliament will take place on January 9 2018.

Both BESA and ECA jointly endorse the Bill, and will fully support it through its progress in Parliament. In addition, both bodies anticipate significant additional political and industry support for the Bill.  

Recent research by Pye Tait on retentions has shown that over £700 million worth of retention money has been lost due to upstream insolvency in the past three years and that, on average, £27,500 is held in retention per contractor.

In an industry of 280,000 SMEs, 44 percent of contractors have suffered non-payment through upstream insolvency in the last three years.

Paul Reeve, director of business and external affairs at the ECA stated: “This Bill aims to protect the supply chain from the serious impact of lost retentions due to upstream insolvency.

“Way beyond those companies who are damaged by upstream insolvency, even the possibility of losing retention money in this way hampers small business investment and growth.  As such, this Bill is entirely consistent with the aims of the new Industrial Strategy, which looks for innovation and investment in skills”.

Rob Driscoll, legal and commercial director at BESA added: “With central government and major projects the biggest single construction client, the case for reform is inherently connected to the Government’s industrial strategy.

“To meet the challenges set by the recently launched Industrial Strategy and construction sector deal, enabling industry to re-invest in jobs, training, innovation and technological transformation, government intervention is necessary to secure working capital that underpins the delivery models for the industry as a whole.”

The Bill will be introduced while the Government consults over reforming the current retentions model. The government consultation runs until January 19 2018. 

6 December 2017

Comments

Already Registered?
Login
Not Yet Registered?
Register

HVR Awards 2018: Entry deadline extended

In response to high industry demand, the deadline for entries to this year’s HVR Awards has been extended to Tuesday July 31....

  28-Jun-2018

Trust Remeha to offer out-of-hours engineer support

Remeha has been receiving great feedback on its new out-of-hours engineer support helpline for Remeha heating solutions – one of the many ways the business strives to deliver unbeatable service....

  04-Jul-2018

Flakt Woods range of axial fans

Flakt Woods JM axial flow fan range of cost effective highest quality long cased axials. We think this product is the World’s best axial fan, and our recommended number one choice for every industrial and commercial application
  20-Jul-2018
Heating & Ventilating Review is the number one magazine in the HVAR industry. Don’t miss out, subscribe today!
Subcribe to HVR

Diary