The Queensland Government is currently preparing new laws which will introduce a suite of measures to ensure the security of payment for subcontractors. The historic building and construction industry reforms will include establishing project bank accounts.
According to Premier Annastacia Palaszczuk, the State Government’s action on security of payment will help set up Queensland’s construction industry for long-term growth.
“We took a commitment to the last election to review security of payment for subcontractors. The evidence is in and it shows that all Queenslanders will benefit from making sure people get paid in-full, on-time and every time," the Premier said.
“The balance hasn’t been right. It’s time to get construction back on the level,”
The Premier also stated that project bank accounts will help provide confidence and security to the 69,000 small subcontracting businesses in Queensland.
According to Housing and Public Works Minister Mick de Brenni, the State Government is now preparing legislation to phase in project bank accounts across the region.
“Project bank accounts are the centrepiece of a suite of measures that will make sure subbies aren’t left out in the cold," the Minister said.
“From January 1 2019, every construction project over $1 million will be required to operate a project bank account.”
Mr de Brenni said that the local Government will be supporting the industry in transitioning towards this legislation by introducing project bank accounts on all State Government construction projects that will range between $1 million and $10 million from the beginning of 2018.
“The Deloitte report is clear - security of payment means more jobs and more investment from small business,” Mr de Brenni said.
Mr de Brenni also said that the project bank accounts were part of a series of proposed reforms which were outlined in the State Government’s proposed Queensland Building Plan.
“The Queensland building and construction industry is worth $44 billion to our economy and provides work for 220,000 Queenslanders.
“Our Queensland Building Plan will build a solid base for continued confidence across the industry, for builders, subcontractors and consumers,” Mr de Brenni said.
According to Mr de Brenni, the Queensland Building Plan will cover matters that include the QBCC Home Warranty Scheme, non-conforming building products, licensing reforms as well as a potential single housing code for the State, amongst others.
“This government is absolutely committed to building confidence in our construction sector and major reforms like supporting subbies demonstrate this commitment.
“Over the coming months this government will engage with building and construction industry stakeholders to finalise the details of our building legislation,” Mr de Brenni said.
The Queensland Building Plan is open for consultation until April 2017.
Find out more about the plan through the Queensland Building Plan website.
Update as of February 2017: The Queensland Government is intending on fast-tracking the key elements of its reform.
"But to back-in our active approach to strengthening protections I will be looking to introducing complimentary measures that will take effect as soon as the laws pass the Parliament this year.
"The new reforms will significantly increase protection for subcontractors, by increasing penalties for non-payment and rewarding builders who consistently do the right thing by the industry," Mr de Brenni said.
The complimentary measures that Mr de Brenni mentioned will include increasing the demerit points for non-payment as well as a more transparent and simplified payment adjudication system. Removing the second chance rule for builders and an easy method for lodging subcontractor charges are also included in the measures being developed.
According to Mr de Brenni, he will also be working closely with the Queensland Building and Construction board in order to rebuild the Minimum Financial Requirements regime for construction business which will give added protection for subbies and consumers.
"Our Government will make sure that the QBCC has the powers it needs to investigate wrong doing. This will include a closer working relationship with ASIC," Mr de Brenni said.
You can read more about the reform's progress here.
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Source: Queensland Government (1, 2)
