13 October 2011
Changes to the Housing Grants, Construction and Regeneration Act 1996 came into force in England and Wales on 1
October and will become effective in Scotland from 1 November.
As part of the changes, new rules governing payment processes and adjudication for the construction industry
should help to reduce the number of claims for non-payment of bills by creating a level playing field for both
contractors and their employers. They do however do require an extensive review of standard forms and
Alistair Kennedy, solicitor with law firm Tods Murray welcomed the changes, but warned that they could take
some getting used to because they herald a significant re-balancing of power.
He said: ‘The new Act aims to make the payment process fairer as both parties – employer or contractor – can
initiate an invoice or payment notice to ease or generate cash flow. For this to happen the terms of
construction contracts will have to change to comply with the new regulations, and getting used to these new
terms could take time for some. However...matters of non-payment can be dealt with proactively, rather than
seeing them escalate into adjudication or a courtroom battle.’
Further details on the changes are available here.