Make Payment Laws Work – Building Group

Laws intended to protect contractors with regard to cash flow on large projects in Australia are ineffective, out of date and cause friction between building contractors and their principals, a building and construction industry group says.

Describing security of payments laws as a ‘bug bear’ issue for the industry, Master Builders Australia chief executive officer Wilhelm Harnisch says many of the laws do not make sense and are in desperate need of an overhaul.

For example, under the current system, a $1,000 claim is subject to the same procedures as a $10 million claim – a concept Harnisch describes as ‘practical nonsense.’