Construction Sector: Cash Retentions

Lord Watts Excerpts

Monday 11th December 2023 Lords Chamber

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that question. As I indicated, the direction of travel has improved considerably, with the construction sector working positively to reduce the amount of late payments. Working with the contractors’ umbrella body, Actuate UK, and the new Get it Right initiative, I think we will see some improvements. We are trying to get defects and collection and completion certificates using processes developed by the Get it Right initiative, which are going to be data-based, to try to get a metric system which is more objective and less subjective and which can measure performance and indicate at an early stage whether it has been to the right standard. That will go a long way towards allowing earlier payment on retentions.

[Lord Watts (Lab)]

My Lords, could not the Government introduce legislation that separates any money that is being held and pay the interest to the contractors, rather than the person who is benefiting now?

[Lord Offord of Garvel (Con)]

As the noble Lord from the Cross Benches said, there are many suggestions as to how we go about doing this, and this is another one. On statutory bans on cash retentions, my department is fixated on trying to remove regulation from business, not increase it. We are looking to the industry to come forward with viable plans on how to make this work. Progress is being made and more can be done, but there is still not complete consensus on how to move this forward.