A perfect storm of inflation, interest rate hikes, supply chain issues and wildfires have all affected B.C.’s construction industry this year, however a persistent lack of provincial prompt payment legislation (PPL) has just added to the woes, says Chris Atchison, president of the BC Construction Association (BCCA).
More projects in the province were delayed or put on hold as a result of budgetary pressures brought on by problems plaguing the industry, he notes. Meantime, wildfires affected pockets of smaller projects,
“There’s pressure on budgets due to inflation and the cost of material and the cost of labour shortages, mostly on the private side,” he says. “When we’re seeing projects go to market and then that cost is coming back, it’s a bit higher than anticipated. People are delaying a little bit, waiting for a more favourable time.”
Lack of PPL, which would ensure workers and businesses get paid on time, is an added headache for the industry, with some B.C. contractors and workers going to work in jurisdictions that have protections.
“When we don’t have a system or the legislative rigour in British Columbia that we’re seeing in other jurisdictions to protect the industry, like the prompt payment legislation, contractors are having to really protect themselves, their livelihoods and the livelihoods of skilled tradespeople that work for them,” says Atchison.
The BCCA has many members, whether they be larger general contractors or trade contractors, that operate in multiple jurisdictions and in other provinces like Alberta and Ontario where PPL has been enacted, he says.
“The feedback that we’re given is that having prompt payment legislation in a jurisdiction is a game-changer. It enables both certainty in payment terms, it allows relative confidence when it comes to change orders, and it allows for communication to be required on projects and just ensures the overall health and transparency of a project.
“In absence of that, when you remove communication, when you remove transparency, remove certainty, you create a climate that isn’t optimal for all those who are needed in our industry.”
An earlier survey by the BCCA revealed 34 per cent of contractors are paid late more than 25 per cent of the time. It’s not unusual for contractors to go three or four months without being paid, according to the BCCA.
Atchison says the labour shortage is not specific to B.C. and notes the lack of PPL is not the sole reason for the situation – but it’s not helping matters.
“If B.C. continues to enable this two-tiered system of construction in Canada, where we don’t have legislation that ensures prompt payment, lien reform and adjudication, then we’re going to continue to lag behind and fall behind the rest of Canada when it comes to a province that really supports a healthy and robust construction economy.”
Last spring, the BCCA learned a working group would be convened to study how PPL could be introduced in B.C. The province notified the association it is doing an analysis of what’s happening in other jurisdictions and Atchison agrees the experiences and views of other stakeholders across B.C. should be considered. However, the association wants consultations to happen in a more timely manner.
“This isn’t something that we want to do in isolation. We need to build an inclusive table to get the best legislation possible for British Columbia. But the Office of the Attorney General clearly has other priorities and has dedicated its resources to other legislation. It’s unfortunate because we’ve been requesting this for a number of years for them to review this and it’s a significant issue for British Columbia.
“I guess the best way to say it is we’ve been pushed off. We keep getting pushed off and the priority isn’t there. But we also feel there are people within the government who are paying attention to what’s happening in other jurisdictions.”
Atchison says the BCCA has offered to provide the attorney general’s office with an analysis that compares federal and provincial legislation that exists across the country in order to keep the ball moving on the proposal.
Meantime, the BCCA and its partners are plugging away with other programs aimed at getting new recruits into the trades system. They include Builders Life, which connects individuals and newcomers to workforce programs, and BCCA Apprenticeship Services, a program that supports small- and medium-sized employers to hire and register first-year apprentices.
“We’re doing extremely well in attracting new people to the industry,” says Atchison. “It’s really good news coming from the uptake, both from the talent side and the contractor side.”
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