The Expanding Project Trust Account Framework in Queensland is new legislation that aims to improve payment security for subcontractors and other construction industry participants. The new legislation requires head contractors to hold money paid on behalf of a project principal in a separate bank account.
The projected trust account framework is currently only applicable to a limited number of government and private sector projects. Still, it is expected to be expanded to cover all projects worth AUD 1 million or more by 1 October 2023. And with this change, document management software would be necessary for an easier information storage option, work and money flow.
After reviewing the current PBA regime, the Queensland Government introduced the BIF Amendment Bill in February 2020. This bill made several amendments to the PBA regime and replaced it with the concept of ‘project trusts’. It was approved by the Queensland Parliament on 23 July 2020 and came into effect on 1 March 2021. The new BIFOLA Act replaces Chapter 2 of the BIF Act and replaces the PBA regime with a new statutory trusts regime. Its commencement date is set for 1 March 2021.
The expanded Project Trust Account framework will apply to more construction work than the current PBA regime. These include specialist work, earthmoving, and electrical services. These services are not provided by the head contractor and may involve the services of a professional engineer. Hopefully, this legislation will provide better payment security for construction workers and subcontractors.
The Expanding Project Trust Account Framework in Queensland also requires Queensland government agencies to meet the Web Content Accessibility Guidelines 2.1 Level AA. The legislation also requires agencies to develop accessibility plans for their digital services, which can be agency-wide or for each digital service. These plans should be integrated into the planning process for digital services.
The next phase of the new scheme will start on 1 July 2021 and remove the $10 million valuation cap. This will be a significant change for commercial construction projects in Queensland. The new system will be compulsory for most private and public sector projects in the state and call for the best construction estimating software to help in the upcoming changes.
If you want to know easily how to comply with the expanding project trust account framework in Queensland, you can read this insightful infographic from Bizprac.