The Specialist Engineering Contractors' Group has won an oral hearing with the Trade and Industry Select Committee into the use of retentions.
Recommendations presented at the 17 October hearing by the SEC Group include:
  • the phasing out of retentions by 2007 in all public works contracts and on those projects wholly or partly funded by the public sector;
  • the endorsement and monitoring of the initiatives in the Accelerating change report to improve payment security and address retention abuse;
  • an approach to the Chancellor of the Exchequer to review the taxation status of retention monies on business accounts.

Rudi Klein, chief executive of the SEC Group, said: "The hearing provides an opportunity for the issue of retentions to be looked at in the new climate of Accelerating change."

The Select Committee will put together a report before the end of the year and present it to the DTI. Government then has two months to respond.

"This result keeps DTI interest in construction payment methods high," said Klein.

Source

Electrical and Mechanical Contractor