Cash flow is King
In any business, cash flow is king. In construction, this is
true at all points in the contractual chain.
For head contractors, this means having to coordinate carefully,
payments from principals and payments to subcontractors against the
backdrop of statutory requirements which have recently changed in
WA. Specifically, from 3 April 2017, the maximum payment term for
construction contractors under section 10 of the Construction
Contracts Act 2004 (WA) ("CCA") has
been reduced from 50 to 42 days.
BCA's Supplier Payment Code
Meanwhile, on 29 May 2017, the Business Council of Australia
unveiled its Australian Supplier Payment Code. This voluntary
initiative sees some of Australia's biggest businesses commit
to ensuring that small business suppliers are paid within 30 days
of issuing a correct invoice. Amongst the signatories, a notable,
large-scale employer of construct contractors' services is Rio
Tinto.
