ADCAS responds to recent cash retention bill

The Association of Ductwork Contractors and Allied Services (ADCAS) has welcomed the recent Government retention payment consultation and responded accordingly.

ADCAS endorsed the headline findings in the related report by specialist consultants Pye Tait and have strongly encouraged the Government to act on the long standing and already clearly understood issues and not to find excuses for further delay. ADCAS has always maintained that only legislation to remove retentions will have any real transformational effect and remains ready to offer further evidence and assistance to Government accordingly.

The seriousness of the situation was brought into stark relief by the demise of the second biggest construction company in the UK, Carillion, which went into liquidation days before the Consultation closed on 19 January 2018. This dire event should be a game changer for the industry in that it outlined the significant vulnerabilities across the supply chain and further demonstrated the importance of late and non-payments being addressed within our sector.

It was recently estimated that the average UK contractor has £27,500 withheld per year in retentions, which limits their ability to invest in apprentices, upskill existing employees and improve productivity and quality.

In a parallel development ADCAS has fully supported an initiative led by ECA and BESA to bring in legislation to create a compulsory retention deposit scheme. With this in mind, on 09^th January 2018, MP Peter Aldous introduced   the first reading of the new Retentions Bill under the ‘Ten Minute Rule’. His bill seeks to amend the 1996 Construction Act to ensure retention money is held in a deposit protection scheme, which is a critical safeguard in the event of upstream insolvency and also a disincentive to the worst abusers of the status quo who use retention sums for their own cash flow purposes. The bill has enjoyed considerable cross party support and its next reading will take place in Parliament on Friday 27^th April 2018.

For further information, please visit ADCAS official website: www.adcas.co.uk

14-02-2018