Construction Act to be amended

United Kingdom
14/05/2008
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Today Gordon Brown announced that the Construction Act is to be amended during the next parliamentary session.

The Construction Act (with the full name Housing Grants, Construction and Regeneration Act) celebrated its tenth birthday a fortnight ago. The new legislation will fall within a Bill covering a medley of other matters as is clear from its title in which “Construction” does not even figure: the Community empowerment, housing and economic regeneration bill.

The Bill is expected to adopt the proposals made in the government’s second consultation paper of June 2007. Key proposals then included:

  • Extending the Act to cover oral and partly oral contracts.
  • Beefing up payment notices.
  • Banning pay when certified clauses.
  • Banning clauses requiring the referring party in an adjudication to pay his own and his opponent’s costs, win or lose.

A table summarising the June 2007 proposals and, just as importantly, the areas in which action is not proposed (such as extending the Act to PFI/PPP project agreements or excluding PFI/PPP sub-contracts) is included here (at pages 4 to 7).

We will report again once the Bill is published. However, the industry may not know before next year how the final Act, once it has gone through parliament, will look.

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