03 December 2019
The Queensland Government has issued its response to the Building Industry Fairness Reforms Implementation and Evaluation Panel Report (Report), which proposed amendments to the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) regarding the use of project bank accounts (PBAs).
All 20 recommendations proposed in the Report have been either accepted or accepted in-principle by the Queensland Government. The reforms are expected to commence on 1 July 2020 and be fully implemented within 24 months.
A PBA is a trust account that a principal pays progress payments into under a construction contract for ‘building work’ where certain criteria are met. The PBA framework is designed to ensure that payments that subcontractors are entitled to receive remain protected in the PBA until they are due to be paid to the subcontractor. Our previous article on the project bank account regime can be accessed here.
Phase 1 of the PBA reforms commenced on 1 March 2018, but only applied to Government building and construction projects valued between A$1 million and A$10 million (GST inclusive).
It was proposed in the Report (and accepted by the Queensland Government) that through three further phases, PBAs would be made compulsory for every project for building work valued over A$1m:
Additionally, the Report recommended further amendments be made to the BIF Act regarding the operations of PBAs. The most important of these accepted amendments include:
Phase 2 (the initial Phase) will commence on 1 July 2021. When this phase commences, all government and private projects for building work valued at A$10m and above will require PBAs (in addition to existing requirements for Government projects for building work over A$1m to have a PBA).
Phase 3 will commence 4-6 months after Phase 2 (likely 1 January 2022). When this phase commences, all private projects for building work valued between A$3m and A$10m will also require PBAs.
Finally, Phase 4 will commence 4-6 months after the commencement of Phase 3 (likely 1 July 2022). When this phase commences, private projects for building work valued between A$1m and A$3m will also require PBAs.
It is anticipated that legislation will be forthcoming in the final half of 2020.
 Building Industry Fairness (Security of Payment) Act 2017 (Qld) s 13, 14
 A full list of recommendations can be seen in attachment A of the report.
 An Evaluation of Queensland’s Building Industry Fairness Reforms (n 1) pg 32
 Ibid pg 35
 Building Industry Fairness (Security of Payment) Act 2017 (Qld) Part 5 Chapter 2
 An Evaluation of Queensland’s Building Industry Fairness Reforms (n 1) pg 41
 Building Industry Fairness Reforms Implementation and Evaluation Panel ‘Panel review of building reforms’, Department of Housing and Public Works (Website, 28 November 2019), available here.
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