The provincial government is getting the ball rolling on prompt payment legislation, and proposed legislation could be introduced by the fall.
The province said in a Tuesday statement Attorney General Niki Sharma recently directed her ministry to prepare a proposal for further consideration by the BC NDP government.
“The government wants to ensure that businesses are paid promptly for work performed on, or material provided to, construction projects,” said the statement.
“The Ministry of Attorney General has been tracking the issue of payment delay in the construction industry, including legislative responses in other jurisdictions. Evidence from other jurisdictions, particularly Ontario, suggests that legislation is working.”
The statement said the earliest possible timeline to introduce proposed legislation would be this fall. Before any legislation would come into force, there would be a period for government to set up an adjudication authority and for the industry to prepare through educational and awareness campaigns, it said.
For years, prompt payment legislation has been the single biggest legislative priority of B.C. construction industry leaders.
The goal of prompt payment legislation is to increase the cash flow of contractors and subcontractors by legislating mandatory payment terms. The legislation includes aspects like invoice specifications, payment timelines and dispute resolution provisions.
Chris Atchison, president of the BC Construction Association (BCCA), praised the move.
“It’s really good news. I would say we’re incredibly appreciative for the attorney general to have listened and taken the time to really understand the concern that the industry has voiced over the last number of years,” he said.
Such legislation “protects public money, it protects livelihoods, and it’s just a better way of doing business to have payment certainty within the construction continuum,” he said.
While there is light at the end of the tunnel, some potential sticking points could possibly emerge.
“If we focus strictly on prompt payment and adjudication, we will get most of it right, but there still is an element of lien reform that is being recommended strongly by us, in and around the provisions of holdback release and the timing of holdback release,” Atchison said.
“You need to consider the whole package, which is prompt payment and adjudication and meaningful lien reform as well.”
But the BCCA president said these hurdles can be overcome through continued “meaningful dialogue and engagement.”
“We’re not going to look negatively on this announcement at all,” Atchison said.
