Unite: project bank accounts will iron out disputes - Builder & Engineer

Tuesday, 29 April 2008

Project bank accounts for the construction industry will iron out one of the industry's biggest fault lines, Unite said yesterday.

The reaction follows Barclays launch of project bank accounts for the private and public sectors.

The account has been developed with construction consultant Rider Levett Bucknall and will be jointly operated by the client and the main contractor on behalf of the subcontractors.

Bob Blackman, national secretary of the TGWU section of Unite, told B&E payment disputes have been one of the biggest problems for the industry.

Blackman said: "If it means to say that contractors are going to be paid properly and swiftly then I think that's going to help everyone. Some of the smaller subcontractors don't have the resources or the financial capacity to wait months and months for payment."

Upon certification of stage payments, funds paid into the Barclays Project Bank Account are electronically transferred by Barclays to the ultimate beneficiaries.

The Office of Government Commerce (OGC) estimates project bank accounts could reduce tender prices by up to 2.5%.

An OGC spokesman said it is working to ensure that government construction clients take up the fair payment initiative.

The Highways Agency and the Ministry of Justice are expected to adopt them from May 2008.

Barclays said it would also target private sector clients, such as supermarkets and high street retailers to use the account.