Construction Sector: Cash Retentions

Baroness Donaghy Excerpts

Tuesday 10th September 2024 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

As the noble Lord has said, there have already been some changes made to this and we are following that up to introduce further changes. We will be addressing the value of payments and the level of invoices not paid because of disputes, but there is more work to be done on this and enforcement is obviously part of that. DBT has already written to 416 large companies not complying with the payment performance reporting requirements and 45% of firms written to have come into compliance. We have further follow-up action to make sure that those further transgressions are being addressed.

[Baroness Donaghy (Lab)]

My Lords, I often think of Lord O’Neill of Clackmannan, who was a great champion of this issue, and I pay tribute to the noble Lord, Lord Aberdare, for following in his footsteps. Does the Minister agree with me that the present proposals do not get rid of the plain abuse of power that happens in subcontracting and contracting in construction? Late payment leads to bankruptcies in small and middle-sized firms and is part of the difficulty across the whole of the construction industry that leads to cutting corners in safety—and we have seen the results of that over many years. Does she agree that Lord O’Neill and the noble Lord, Lord Aberdare, who have been fighting for this for years, have been looking for something a bit more concrete?

[Baroness Jones of Whitchurch (Lab)]

My Lords, as I have said, it is important that we seek the views of industry on any reforms. We will take further action and obviously we will welcome the views of Members of this House, as well as the construction industry, as part of that process. The noble Baroness and other noble Lords have talked about safety and we are acutely aware of the situation with the Grenfell Tower final report, which highlights the systemic failure of institutions and individuals to ensure building safety and the safety of construction products and materials. My honourable friend the Parliamentary Under-Secretary of State for Building Safety and Homelessness tabled a Written Statement on 2 September that commits the Government to a system-wide reform of the construction products regulatory regime. Those reforms will take account of the recommendations of the Grenfell Tower inquiry.