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New payment law to protect building subcontractors

Author
Newstalk ZB Staff ,
Publish Date
Sat, 25 Feb 2017, 10:12PM
File photo (iStock)
File photo (iStock)

New payment law to protect building subcontractors

Author
Newstalk ZB Staff ,
Publish Date
Sat, 25 Feb 2017, 10:12PM

The construction industry's being urged to sort out how a new payment system for subcontractors will work.

From late March, building companies will have to hold payments for builders and subcontractors in trust rather than delaying payment until after a job is done.

The law change aims to protect subcontractors paid nothing when building companies collapsed during the recession.

But Institute of Quantity Surveyors spokesman Peter Degerholm said the new system also shouldn't be too expensive for building companies to introduce.

"One of the things the minister did indicate, and it's been quite clear in the amendment bill, that the regime isn't supposed to cost very much - it's supposed to be easy to comply with," Degerholm said.

Degerholm says the industry will need common guidelines for following the new law.

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