To ensure Queenslanders who work in the building and construction industry are paid for the work they do, the Queensland Government introduced new legislation into Parliament on 5 February 2020.
The Building Industry Fairness and Other Legislation Amendment Bill 2020 includes security of payment reforms to:
- extend Project Bank Accounts to the private sector and rename them Project and Retention Trusts to more closely reflect what the accounts do
- enable a claimant to make a withholding request if they aren’t paid an adjudicated amount
- give head contractors more protection like being able to place a charge on land when they aren’t paid an adjudicated amount
- introduce a penalty for underpayment of a scheduled amount
Previous Building Industry Fairness reforms commenced on 10 November 2017 through the Building Industry Fairness (Security of Payment) Act 2017. It is expected that the latest legislation will commence on 1 July 2020.
The roll-out of Project Trust Accounts in Queensland will force major changes in the building and construction industry in the state.
Louise Stewart, former Chair of a leading Australian subcontractors’ association and creator of ProjectPay says the Building Industry Fairness Bill is a huge step forward and now is the time for other state and territory governments to follow suit.
“Combined with technology, trust accounts will be hugely beneficial in transforming and protecting payments in the industry, which will benefit everyone down the supply chain.”
Stewart has long campaigned for cascading trusts or Project Bank Accounts (PBAs) to be introduced in Australia, following a federal government review and recommendation by industry veteran John Murray AM that trust accounts should be legislated on all projects across Australia.
She says it’s now even more important than ever for builders to embrace new technology to help facilitate the requirements of cascading trusts and PBAs, designed to address the delayed and non-payments issue plaguing the construction industry.
“To overcome the barriers of use, such as high levels of manual administration, the combination of technology and trust legislation that cascades down the supply chain is the answer,” she says. “The Queensland government knows it, as does the WA government, which is due to release a new bill in April for industry consultation, requiring cascading trusts to be used on all government and private building projects over a certain threshold. Now it’s up to other governments to follow their lead.
“Real estate agents have adjusted to using trust accounts – and the construction industry now needs to do the same.”