The Specialist Engineering Contractors’ Group hopes to force main contractors to place all retention payments in special trust accounts by tabling a last-minute amendment to the Small Business, Enterprise and Employment Bill as it passes through the House of Lords.



In addition to the amendment in parliament, an e-petition has been launched to give government an understanding of the support for keeping retentions safe in the construction industry.



Whilst protecting sub-contractors, this movement would also bring the UK into line with countries such as France, Germany, America and Australia, before the UK moves towards the Department for Business, Innovation and Skills’ stated goal of abolishing retentions by 2025.



Chief Executive of the SEC Group, Professor Rudi Klein, said: “The best way to get rid of this much hated, unfair and outdated practice of retentions in the construction industry is to put them out of reach of those withholding them by putting them into trust.”



100,000 signatures need to be collected by 30th March to trigger a parliamentary debate, with the issue being brought to Parliament for the first time last week, which saw Debbie Abrahams (MP for Oldham East and Saddleworth) attempt to table an amendment in the House of Commons.



Abrahams said: “I have several examples, including that of a company that wrote to me to say that £60,000 of retention moneys was withheld—5% of the overall contract—for eight months.



“There was nothing in the contract about that. They had to go through adjudication and it ended up with them losing £22,000. These are small businesses, and this is their livelihood.



“There is evidence that cash retentions have been used to shore up the working capital of local authorities and tier 1 suppliers.



“There is a key concern that if tier 1 suppliers become insolvent, the small businesses in the supply chain are at risk of losing their retentions.”



Abrahams withdrew her amendment seeking the use of trust fund when Small Business Minister, Matthew Hancock agreed to work with the opposition on proposals to make retentions redundant.



He said: “We are working with industry to move to a position where retentions are no longer necessary, and I would be happy to work with the Opposition Members to push that further.”



The National Specialist Contractors Council will release the results of a survey reviewing how retentions have affected smaller businesses in the construction industry.



To sign the e-petition to safeguard cash retentions for sub-contractors in contracts click here.