OTTAWA — Canadian construction industry stakeholders were in Ottawa today to hear about the federal government’s plan to legislate prompt payment requirements on all federal construction projects.
Steven MacKinnon, parliamentary secretary to the minister of public services and procurement, hosted stakeholder groups at the department headquarters in Gatineau, Que. to announce the initiative. A review will be led by construction law experts Bruce Reynolds and Sharon Vogel from Singleton Urquhart Reynolds Vogel LLP.
The move comes after months of collaborative work between contractor groups, civil servants and parliamentarian champions, states a release issued by the National Trade Contractors Coalition of Canada (NTCCC).
“Trade contractors have been encouraging the government to take action on this initiative for years,” said John Galt, chair of the NTCCC, in a statement. “The proposal put forward by the Parliamentary Secretary and MPs today will result in trade contractors taking on less risk on federal projects, being able to put forward more competitive bids, and tradespeople and apprentices will benefit as a result.”
Reynolds and Vogel were instrumental in bringing forward reforms in Ontario’s Bill 142, the Construction Lien Amendment Act, 2017, including a prompt payment regime, modernization of construction lien and holdback rules and an adjudication system that provides interim binding resolution of disputes. The bill received royal assent in the Ontario legislature in December.
Bill 142 was supported by groups representing all segments of the construction sector including general contractors, trade contractors, suppliers and labour groups, the release indicates, adding the federal government intends to follow a similar framework to achieve consensus by consulting widely and moving legislation forward efficiently.
“We have benefitted from the support of many champions to get to this point and want to thank Senator Don Plett and MP Judy Sgro for their tireless efforts to encourage action on this file,” said Galt. “We know that prompt payment enjoys support from all parties and we look forward to helping the politicians and regulators in finding the best possible legislative solution.”
Ray Bassett, a director and member of the Canadian Construction Association Executive Committee, stated in a government release that this is a major step in the right direction.
“The timely flow of payment within all tiers on construction projects is necessary to allow material and equipment suppliers, subcontractors and trades, labour, and general contractors to succeed in their businesses,” he said. “It will also continue providing the construction capacity to build Canada’s infrastructure and to create jobs and economic opportunities in an industry that represents a very significant part of the economic activity in Canada.”
The government stated in its release it will be seeking industry input and recommendations on federal prompt payment legislation.
“The General Contractors Alliance of Canada (GCAC) fully supports Minister Qualtrough’s appointment of Bruce Reynolds and Sharon Vogel to conduct a third-party review and make recommendations to implement prompt payment legislation in Canada,” added Matt Ainley, chair of the GCAC.
“GCAC will provide Bruce and Sharon with our full support and co-operation and we are eager to begin the review.”
The Daily Commercial News and Journal of Commerce will have more industry reaction on this announcement in an upcoming article.