PROJECT TRUST LEGILSATION INTRODUCED TO PARLIAMENT
Following Property Council advocacy, new legislation containing amendments to the original Project Bank Account model have been tabled in Queensland Parliament.
The revision to original Project Bank Account (PBA) model contains amended timelines and guidelines that were announced by the Queensland Government last year.
Major changes to the PBA guidelines include:
- Removal of the disputed funds account
- Removal of principal supervision in favour of QBCC oversight
- Increased punitive measures for non-compliance
- Simplified definitions for ‘building work’, ‘subcontractors’ and ‘suppliers’
The legislation will adopt new timelines for the rollout of Projects Trusts:
- From 1 July 2020 Project Trusts will apply to eligible government and Health and Hospital Services’ building contracts of $1 million or more.
- From 1 July 2021 Project Trust Accounts will be extended to the private sector and local government for eligible building contracts valued at $10 million or more.
- From 1 January 2022, Project Trust Accounts will cover eligible building contracts worth $3 million or more.
- On 1 July 2022 trusts will be required for all eligible building contracts valued at $1 million or more.
The Property Council have opposed the introduction of PBAs since their announcement in 2017. In various submissions, the Property Council has outlined concerns with the PBA model due to the regulatory burden it would place of businesses. In the submission ‘5 ways to improve the PBA model’, the Property Council provided suggestions to improve the model.
Although remaining against the introduction of PBA’s the Property Council welcomes the latest amendments to the model which has incorporated industry feedback and will be less onerous than the original PBA framework. Furthermore, the extended timeframes for the rollout of project trusts provides industry with more time to plan for the transition.
The Property Council will review the amendments contained in the Bill and provide a submission to the Transport and Public Works Committee to which the Bill has been referred.
To view the Bill and explanatory notes, please click here.