- Cook Labor Government strengthens Western Australia’s nation-leading subcontract payment protection framework
- New laws boost insolvency protections for subcontractors working on State Government building projects
- Reforms reduce red tape while delivering greater certainty and security
Subcontractors working on State Government construction projects will get more efficient protections against insolvency following the passing of the Cook Labor Government’s Building and Construction Industry (Security of Payment) Amendment Bill.
The new laws will give greater protection to ‘subbies’ by ensuring payments for State Government building projects, worth more than $1.5 million, are held in a construction trust and better protected in an insolvency.
Once in operation, the construction trust will replace project bank accounts that have been operating widely across State Government projects since 2019. The new requirements will reduce administrative burden and provides greater clarity and certainty for all contracted parties, while ensuring subcontractors are paid for their work.
Detailed guidance will be provided to industry ahead of the new requirements applying to a State Government project.
These laws cement Western Australia’s nation-leading position on subcontractor payment protection, delivering strong insolvency safeguards for the State’s critical infrastructure, housing and schools projects.
As stated by Commerce Minister Dr Tony Buti:
“Subcontractors do the work that builds our schools, hospitals, homes and critical infrastructure, and they deserve confidence that the money owed to them is protected.
“These laws cement Western Australia’s nation-leading position on subcontractor payment protection, with stronger safeguards when insolvency strikes.
“The new construction trust will give subcontractors greater certainty while reducing red tape and providing clearer, more efficient payment arrangements for everyone delivering State Government projects.”
As stated by Finance Minister David Michael:
“These reforms reinforce the Cook Labor Government’s commitment to supporting local small and medium businesses and making sure subcontractors are paid for the work they do on State Government projects.
“The changes also provide greater flexibility for government head contractors, allowing trust accounts to be established with any recognised financial institution.
“We will continue to work closely with industry and government agencies on implementation, with clear guidance provided ahead of the scheme commencing so everyone understands their rights and obligations.”
