What is the Security of Payments Working Group?
The Security of Payments Working Group was established under the BCIIP Act.
The functions of the Working Group include:
- monitoring the impact of the activities of the ABCC on the conduct and practices of building industry participants in relation to their compliance with laws that relate to the security of payments that are due to persons in relation to building work;
- making recommendations to the ABC Commissioner about policies, procedures or programs that could be implemented to improve compliance by building industry participants with security of payment laws; and
- making recommendations to the Minister about any matter that the Minister requests the Working Group to consider.
When did the Working Group begin?
On 26 May 2017, Senator the Hon Michaela Cash, then Minister for Employment, appointed 11 members to the Security of Payments Working Group. Under the BCIIP Act, the ABC Commissioner is a member of the Working Group.
Since then, the Working Group has held ten meetings (summarised below) and will continue to hold four meetings annually. The next is scheduled for 19 March 2020.
Tenth Meeting, 05/12/19
The tenth meeting was held on 5 December 2019. The ABCC presented its security of payments statistics for the quarter ending 31 December 2019. The quarter showed a small reduction in the number of reports of disputed or delayed payments received, however there was an increase in the number of individual claims attached to reports. This is attributed to the new improved reporting form which allows contractors to report more than one claim in a single report.
The Working Group discussed its Terms of Reference and its functions as outlined in the Building and Construction Industry Improving Productivity Act 2016.
Ninth meeting, 06/09/19
The ninth meeting was held on 6 September 2019. The ABCC Q4 Security of Payments Quarterly Statistics showed an upward trend of subcontractors reporting an issue of non-payment. The ABCC discussed its ongoing efforts in simplifying and streamlining reporting for contractors and ensuring that reports relating to phoenixing activity are responded to immediately.
The Security of Payments Annual Report was endorsed by the Working Group and will be presented in the ABCC’s 2018-19 Annual Report.
Fifth meeting, 17/08/18
The fifth meeting was held on 17 August 2018. The meeting was chaired by Grant Lovelock, who was appointed by the Minister, the Hon Craig Laundy, to serve as acting chair.
The meeting was attended by Mr John Murray AM, who took questions from members on his recommendations and findings in his report, Review of Security of Payment Laws.
The members were also presented the ABCC’s security of payment education campaign. The campaign aims to raise awareness of security of payments in the building and construction industry and provide information on how the ABCC can assist with these enquiries. The agency acknowledged the contributions from the members in helping craft the campaign’s key messages.
Sixth meeting, 12/11/18
The sixth meeting was held on 12 November 2018. Prior to the meeting, Grant Lovelock resigned as acting chair of the working group. Justine Ross was appointed by the Minister, the Hon Kelly O’Dwyer, as both the chair and a member to the working group for three years.
The ABCC reported that the quarter ending 30 September 2018 saw a significant increase in the number of enquiries on security of payments. The higher number of enquiries was likely attributable to the commencement of the education campaign on 16 July 2018 and the end of the transition period for mandatory reporting of disputed or delayed progress payments on 1 September 2018.
The ABCC presented the security of payments frequently asked questions on its website. The ABCC sought feedback and advice from the working group on the website content relating to security of payments.
Seventh meeting, 01/03/19
The seventh meeting was held on 1 March 2019. The ABCC presented its security of payments quarterly statistics for the quarter ending 31 December 2018. This quarter saw a higher number of self-reporting notifications by Code covered entities reporting disputed or delayed payments. The increase was primarily due to the commencement of mandatory reporting for Code covered entities from 1 September 2018.
The group also received an update from the Department of Industry, Innovation and Science on the Building Ministers’ Forum including its response to the recommendations of the Murray Review.
Eighth meeting, 31/05/19
The eighth meeting was held on 31 May 2019. The ABCC presented its security of payments quarterly statistics for the March quarter, and discussed its new reporting methodology for incoming security of payment cases. This quarter saw a further increase in security of payment cases and provided a strong indication of where the ABCC should focus its next education campaigns.
First meeting, 07/07/17
The Working Group met for the first time on Friday 7 July 2017, in Melbourne. The Terms of Reference and the Forward Work Plan were discussed and the ABC Commissioner gave a presentation on the role and functions of the ABCC regarding security of payments.
Second meeting, 10/11/17
The second Working Group meeting was on Friday 10 November 2017, in Melbourne. During this meeting, the outstanding actions from the previous meeting regarding the Terms of Reference and Forward Work Plan were settled. The ABCC provided context on its role in security of payments laws and the agency’s jurisdiction over code covered entities .
In addition, education was discussed as a tool to increase building industry participants’ pursuit of security of payments rights and the reporting of security of payments issues.
Third meeting, 16/02/18
The third meeting took place on 16 February 2018. The members were introduced to the new ABC Commissioner, Mr Stephen McBurney, and were advised that enquiries to the ABCC about security of payments are gradually increasing. The Working Group also discussed the ABCC’s education strategy and how best to target communication with subcontractors.
Fourth meeting, 04/05/18
The fourth meeting was held on 4 May 2018. The members discussed the definition of reportable delayed or disputed progress payments in the Code and provided feedback on the ABCC’s proposed key messages for education. Further feedback was planned to be provided out of session.
Appointees to the Security of Payments Working Group
The following is a list of industry representatives that have been appointed to the Working Group:
- Ms Sophie Ismail—representing the interests of employees in the building industry (ACTU)
- Ms Vasuki Paul—representing the interests of employers (Ai Group)
- Mr Shaun Schmitke—representing the interests of employers (Master Builders Australia)
- Ms Melissa Adler—representing the interests of employers (Housing Industry Association)
- Mr Ken Phillips—representing the interests of contractors (Self Employed Australia)
- Mr Suresh Manickam—representing the interests of contractors (National Electrical and Communications Association)
- Mr Chris Melham—representing the interests of contractors (Civil Contractors Federation)
- Ms Juanita Gibson—representing the interests of contractors (Subcontractors Alliance)
- Ms Lorraine Djuricin—extensive adjudication experience in conflict resolution (Adjudicate Today)