Expert Witness Journal Issue 68 August 2026 - Flipbook - Page 61
Rob Driscoll, Director of Legal & Policy for ECA,
CLC Business Models contributor and former
Chair of Cabinet O昀케ce Payment Advisory Group
comments:
Conclusion
The government is moving quickly. The Bill has
been published with the second reading due to
take place in June. The Bill sets out in detail how it
will operate and while we understand there will be
some consultation around the drafting, we think the
principle is unlikely to be challenged.
“
The Bill envisages a period of transition, however it
is useful to consider how this will work in practice
and what approach will be taken to implementing
it. It will also be interesting to see how the market
reacts and the position of funders and developers
particularly as there will be a period of time before
the Bill is implemented to allow the market to
transition to the new commercial landscape.
An outright ban risks creating ambiguity and may
encourage paying parties to 昀椀nd creative ways to
withhold money or circumvent the prohibition. In
an ideal world removing retentions would lead to
better managed projects and a reduction in defects
as contractors and sub-contractors work to higher
standards resulting in fewer defects at practical
completion. For the reforms to be e昀昀ective, the
industry will need a cultural shift and change in
practices and behaviours, setting higher standards
and levels of professionalism from the outset. With
the government also consulting on licencing this
may herald the dawn of a new reality.
Contrary to their theoretical purpose, retentions have
been proven to amplify the risk of supplier insolvency
jeopardising client risk of successful project delivery
and not to motivate suppliers to remediate defects.
In the majority of cases, they are cost-prohibitive to
recover and are sti昀氀ing innovation, investment and
growth. The Construction Leadership Council called
on Government to act and supported legislative
intervention. Government has made the decision to
introduce a ban, so industry has a choice, either we
innovate to circumvent the ban, or we innovate to
improve procurement and smarter delivery models –
time will tell which gets more traction in the industry.”
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EXPERT WITNESS JOURNAL
59
AUGUST 2026
