PM announces construction industry contract reforms

15 May 2008
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16 May 2008 | Jake Kanter

Efforts to improve cash flow and dispute resolution in the construction industry have been announced by the government.

The proposals, revealed as part of prime minister Gordon Brown's draft Queen's speech this week, will also see the proposed "construction contractors bill" incorporated into the "community empowerment, housing and economic bill".

It is hoped the legislation, which will be introduced in the new Parliamentary session this November, will increase cash flow through the construction sector's supply chain. In addition, it will encourage parties to resolve disputes with adjudication rather than litigation.

Suppliers' representative group the National Specialist Contractors Council (NSCC) welcomed the draft bill. "We look forward to the detailed legislation, which should achieve the certainty of payment so necessary for the construction industry," said Simon Bottomley, president of the NSCC.

The construction sector often experiences more problems with payment than other industries because of its fragmented nature, with around seven steps between buyer and final supplier (News, 4 October 2007).


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