Critical changes to the Queensland building industry have been approved by parliament: here is your guide

By Act of parliament, the Queensland Government last week passed legislation that will result in major changes to the construction industry. The three key pieces of legislation governing the industry have been overhauled.

Set out below is our guide to the key changes which will be enshrined in the new Building Industry Fairness (Security of Payment) Act 2017 (the Act).

Each section of our guide contains a box with key takeaways, these summarise how the new Act will impact your business.

Principals and head contractors in particular will need to be aware of (and comply with) the changes, or risk being in breach of the new Act.

The key changes include:

1. the introduction of Project Bank Accounts (PBAs) for certain construction projects;

2. the amendment and consolidation of the Building and Construction Industry Payments Act 2004 (BCIPA) and Subcontractors’ Charges Act 1974;

3. amendments made to the Queensland Building and Construction Commission Act 1991 (QBCC Act); and

4. the introduction of penalty provisions to enforce compliance with the Act.

The ambition of the Act, and its subcontractor focus, means that there are a number of provisions that will require industry participants to review how their contracts are drafted and administered. Furthermore, although the introduction of PBAs will initially only apply to a limited number of contracts - they will apply across much of the industry from 1 January 2019.

This will be an area of ongoing development. The accompanying Regulations, that will be key to understanding some of the core provisions and consequences of the Act (including identifying the requirements for payment instructions for PBAs, as well as identifying new prohibited and mandatory conditions for building contracts), have yet to be released.

If there is a change in government following the upcoming Queensland election, further changes to the Act (as well as the expected content of the Regulations) seem a real possibility given the debate in the parliament before the Act was passed.

In the meantime, a Federal Government review into the security of payment legislation in all Australian jurisdictions is due to hand down its final report by 31 December 2017. Whether or not the next Queensland Government will introduce amendments to the new Act to incorporate recommendations made by the Federal review remains to be seen.

You can DOWNLOAD the guide in full or each of the sections individually by clicking on the boxes below.