Construction (Retention Deposit Schemes) Bill

Time to abolish retentions in the construction sector 

The collapse of Carillion earlier this year brought the ongoing issue of cash retentions in the construction sector into sharp focus.  Not only did Carillion leave an estimated 30,000 creditors, mainly SME’s, it is also estimated that Carillion held £800 million of retention payments on entering liquation.

CECA has long supported the abolition of retentions and campaigned for change in this area. And that is why we are calling on Scottish MP’s to support Peter Aldous MP’s Private members Bill at Westminster, which proposes that cash retentions owed to suppliers are protected in trust accounts so can’t be misused or lost when a major contractor goes bust.

The Bill is expected to have its second reading debate on Friday 27 April 2018 and CECA Scotland Chief Executive, Grahame Barn, has contacted all Scottish MP’s urging them to pledge their support for the Bill as it progresses through Parliament and to attend the debate.

Grahame Barn said:

“The issue of cash retentions is an extremely problematic issue for many of our members, who are being adversely impacted by both late payment and lost retentions. This is impacting on our members and on other businesses right across the supply chain and all too often, monies are held for many years after projects are completed. The recent collapse of Carillion highlighted not only the sheer scale of the problem but the urgent need for action. It’s time for cash retentions to be abolished and alternative solutions identified and made available to the construction sector and that is why today I have contacted all Scotland’s MP’s at Westminster asking them to pledge their support for change”. 

CECA Scotland welcomes the “Aldous Bill” as a positive way forward for the industry in ensuring fairer payment and contract terms.  Addressing this issue will not only ensure a fairer deal for SME’s, who contribute billions every year to the economy, it will help drive cultural change in the construction industry, supporting investment, productivity and economic growth.

We will continue to put pressure on at both Holyrood and Westminster level to promote fairer contract conditions and payment and secure positive change in our industry.

You can read the Bill here