Project Bank Accounts will be implemented for Sunshine Coast Council construction projects worth more than $10 million from July 1 next year.
TEGAN ANNETT 30th May 2020 5:00 AM Subscriber only
THE new contractor payment scheme being introduced for council construction projects next year has been described as an "administrative burden".
From July 1, 2021, Sunshine Coast Council will begin implementing Project Bank Accounts for construction contracts worth more than $10 million.
It is part of the gradual phasing-in of the new trust account scheme, which will eventually be mandatory for all construction projects worth more than $1 million from July 2022.
Councillor Terry Landsberg said it was a great initiative.
"Implementing this will further future-proof our subcontractors and the mum and dad businesses who we rely on," Cr Landsberg said.
The payment model means three trust accounts are linked to one building project, where funds are held in trust for head contractors and subcontractors until payments are due.
The accounts secure progress payments, disputed funds and retention money.
Construction company McNab has completed more than $75 million worth of Queensland Government projects with PBAs during the past 18 months.
Sunshine Coast manager Carl Nancarrow said the scheme was difficult to implement, but hoped it would provide surety of payment for subcontractors.
"It definitely does add a significant administrative burden … the logistics of setting up the numerous bank accounts are significant," he said.
"We would've set up hundreds of them and we've had to change internal processes, train staff and subcontractors."
Mr Nancarrow was supportive of the council's decision..