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Project Manager : Project Manager Apr May 2014
www.aipm.com.au Project Manager 11 administer various consultant agreements and the construction contract on behalf of the principal. e amendments to the NSW Act have a significant impact on project managers and -- whether by accident or design -- give a project manager the same status as a head contractor. e Bill introduces new definitions of who, or what, is a principal, head contractor and subcontractor. Section 4 provides the following definition of a head contractor: "'head contractor' means the person who is to carry out construction work or supply related goods and services for the principal under a construction contract (the 'main contract') and for whom construction work is to be carried out or related goods and ser vices supplied under a construction contract as part of or incidental to the work or goods and services carried out or supplied under the main contract." A project manager who has contracted directly with another consultant to provide the types of ser vices listed in Section 6(b) of the NSW Act will now become a head contractor and the amendments will apply equally to them. For example, if the project manager engages design or other technical sub- consultants, they will be considered a head contractor. is has a number of serious implications for the profession. Implications As head contractors, project managers will be subject to ma ximum terms of 30 business days to make progress payments to a subcontractor. However, they do not enjoy the guarantee of receiving timely payments as a head contractor traditionally would, because project management ser vices do not sit under the umbrella of the Section 6(b) definition of a related good or ser vice. Project managers who are also head contractors as defined by the NSW Act will need to ensure that they are suitably infor med of any secondary subcontractor for whom they will be liable for ensuring they have been paid all amounts due and payable, or risk a maximum fine of $22,000 and/ or three months' imprisonment. Likely impact We are yet to see the impact the amendments to the NSW Act will have, but it is likely to change how consultants contract with principals. Project managers may shy away from becoming a ' head contractor' and the additional liabilities that the amendments now confer. Project owners may find that project managers become reticent to bid for projects as part of a team and take on a financial liability for payment of subcontractors, especially when project managers do not enjoy similar entitlements to payment. e future While the amendments only apply in NSW, they impact any project management fir m providing ser vices on a project in the state. It is also likely that they will be applied across other states, with similar Security of Payment legislation in the future. e NSW Government has convened an advisory group made up of representatives from the Housing Industry Association, the Master Builders Association, the Civil Contractors Federation and the Small Business Commissioner to undertake a comprehensive review of the NSW Act in 2015, and these amendments are likely to be only the first in a series of future amendments. New apfpm VPs elected e Asia Pacific Federation of Project Management (apfpm) has elected three new Vice Presidents: Dr Francis Chan, Tikajit Rai and AIPM National President Dr Steve Milner. "I am delighted to welcome our new VPs to the leadership of the apfpm," said President Dr Bill Young. "Each has been an outstanding nominee for the role and has already made strong and committed contributions to the apfpm over the past few years. I am very confident our new team is going to help strengthen and build the apfpm over the next few years." "I see our new team as bringing a lot of energy and wealth of experience," said apfpm Secretary and AIPM National Director Trevor Alex. " ese three new roles will undoubtedly strengthen our capability and improve our performance delivery to our member base. I greatly welcome our new team and look for ward to working with them over the next few years." Dr Francis Chan is a Director of AchieveGoal Management Consultants Ltd in Hong Kong, which specialises in organisational behavioural training, project management training and consultancy services. Dr Chan has a strong practice and academic background, and has played active roles in significant projects over the past 35 years, including highway and rail projects, building developments and new town projects. He currently Chairs the HKIPM's Accreditation and Professional Standards Committee, and its External Affairs Committee. Tikajit Rai has more than 16 years of project management-related experience working on a diverse range of projects for organisations including the World Bank, ADB, INGOs and the Government of Nepal. He specialises in effective portfolio and project management with multinational stakeholders in culturally complex environments. Rai is an expert in cultural integration and leadership development, a social and business entrepreneur, and a visiting lecturer in project management in Nepal. Dr Steve Milner is National President of AIPM and an accomplished leader of complex projects and programs across functional areas and between organisations in the health, industrials and utilities sectors. A Certified Practising Project Director (CPPD), he has been involved in the leadership of numerous projects and megaprojects including the $1.8 billion Adelaide Desalination project. is project won three global awards, including IPMA's Project Excellence (Megaprojects) Award. Steve is also an avid adventurer, leading caving exploration expeditions around the world. THE LEGISLATION AT A GLANCE Project managers defined as head contractors under Section 4 of the NSW Act will be required to: • Make subcontractor progress payments no later than 30 business days after the reference date. • Provide a supporting statement that all subcontractors have been paid all amounts due and payable with any request for payment from the principal. • Provide an authorised person with all information and documents requested regarding compliance with Section 13 (7) or (8). This also applies to anyone the authorised officer reasonably believes to be a head contractor as defined by the Act. The legislative amendments are available in full text on the AustLii database. W: goo.gl/4OcTCn
Project Manager Feb Mar 2014