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Project Manager : Project Manager Apr May 2014
10 Project Manager •NEWS PMs as head contractors under new legislation Legislative amendments that see NSW project managers taking on the role of head contractor will increase reporting requirements and tighten payment terms to subcontractors, while excluding project managers from similar protections. Clearly, protection of payments for subcontractors in the construction industry is a necessity, but is this round of amendments the answer? KAREN WENHAM, HEAD, CONTRACTS, CLAIMS AND DISPUTES, THINC IN 2012, THE BUILDING and construction industry experienced a number of high-profile insolvencies. In response, the NSW Government commissioned an independent inquiry, helmed by Bruce Collins QC. e Collins Report made 44 recommendations including the strengthening of the Building and Construction Industry Security of Payment Act 1999 (the NSW Act). In October 2013 the NSW Government introduced to Parliament the Building and Construction Industry Security of Payment Amendment Bill 2013. e Bill passed both houses of Parliament in November 2013. It including the following amendments to the Act (excluding exempt residential construction contracts): • e introduction of maximum payment terms for payment by a principal to a head contractor, and by a head contractor to a subcontractor. • e requirement that any payment claim the head contractor ser ves on the principal must be accompanied by a statement indicating that all payments due to subcontractors have been paid. • e introduction of retention money trust accounts. e amendments also introduced penalties for failure to comply with payment terms, failure to provide a supporting statement with a payment claim, or provision of a false or misleading supporting statement. Pending finalisation of the regulations to support the new laws, the amendments were expected to commence in early April 2014. Unintended consequences Since the passing of the Bill the primary focus has been on how the amendments will affect principals and head contractors. To date very little of the conversation has considered the impact on project managers who manage project delivery and, in the process, HAVE YOUR SAY Do you think PMs should be taking on these responsibilities? Join the AIPM LinkedIn group to discuss the legislative amendments with project management professionals. W: www.linkedin.com/ groups?gid=1952253
Project Manager Feb Mar 2014