Construction Sector: Cash Retentions
Baroness Thornhill Excerpts(3 days, 5 hours ago)
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Baroness Jones of Whitchurch (Lab)
My Lords, we are prioritising bringing forward the statutory instrument to amend the Reporting on Payment Practices and Performance Regulations this year, with the aim of it coming into force in 2025. This will require large firms to report twice per financial year on their policies in relation to retentions, including standard terms for holding retentions and metrics in relation to payment performance for retentions. We believe that this information will be most useful to small firms in the supply chain, and this legislation was developed in conjunction with firms in the industry and their representative organisations.
Baroness Thornhill (LD)
My Lords, this pernicious issue, interestingly, is not covered in the Government’s construction playbook, which sets out exactly how public works projects are to be assessed, procured and delivered. Indeed, a number of government departments and arm’s-length bodies continue to use retentions themselves. So would it be a good first step for this new Government to put their own house in order as soon as possible?
Baroness Jones of Whitchurch (Lab)
The noble Baroness makes an important point about public procurement. There are steps that we can take to progress on this issue; it is a manifesto commitment that we will do so. Obviously, we will consult before we introduce any further legislation, but we are committed to reviewing our policies on this issue, to enable more smaller firms to be able to access public contracts.