PROJECT BANK ACCOUNTS FOCUS


>>> Continued from page 39


of every sub-contractor and sub-sub- contractor and the reasons for any fi rm declining to join the PBA. Furthermore, “the main contractor


must include PBA provisions in all invitations to tender for sub- contracted work and require sub- contractors to do likewise in all prospective sub-sub-contracts”. Main contractors must be able to


provide evidence that PBA relevant information has been sent to all sub-contractors on the project. The Scottish Government’s model


PBA contract provisions already require main contractors to give written reasons to clients for excluding a sub-contractor from the PBA. They are also required to obtain a written explanation from sub-contractors declining to join the PBA and to make this available to the client. A PBA template notice is shown on the right, which clients must now send to main contractors for circulation to all sub-contractors on the project.


TELL US YOUR EXPERIENCES Have you been in, or are involved in, a PBA? Have you


been on a PBA project where you weren’t invited to join it? If you have been involved in a PBA, did you receive information regarding your payment amounts going into it and the dates when they were deposited? SELECT would like to hear feedback about your experience of PBAs. Please email iain.mason@select.org.uk with your feedback.


PBA TEMPLATE NOTICE


Project Bank Accounts (PBAs) are Scottish Government policy. T ey assure that sub-contractors get paid promptly for work done and that those payments are ring-fenced if the main contractor ceases trading. T is is a notice to fi rms concerning the PBA operating on the following construction project.* Sub-contractors employed by the main contractor must join the PBA where their


sub-contract value is at least 1% of the value of the contract awarded to the main contractor. T ere are very limited potential exemptions and it is generally presumed that sub-contractors will join the PBA. T e main contractor and main contract award value for this project are as follows:* Sub-contractors with lower value sub-contracts and any fi rm on this project


employed by a sub-contractor can ask to join the PBA by contacting the employer in the fi rst instance. Firms who are advised against or denied their opportunity to contact the employer should immediately contact the employer, as follows:*


Employer name: Email address:


Telephone number: A sub-contractor or sub-sub-contractor on this project must sign the additional


party agreement in order to join the PBA. T e additional party agreement must be provided by the main contractor to any sub-contractor it wishes to employ; and by any sub-contractor to any sub-sub-contractor it wishes to employ. Where the additional party agreement is not provided, please contact the employer. No fees or charges in connection with joining the PBA may be levied on this


project. A sub-contractor’s or sub-sub-contractor’s work in progress on site will be valued by the fi rm which contracted it to work on this project. Payment will be received directly from the PBA a day or two after the employer deposits it. All participating fi rms, including the main contractor, will receive payment from the PBA at the same time.


* to be completed by the commissioning body before sending to the main contractor


Claire Lorimer, Procurement Contract Manager at Scotland’s Rural College (SRUC), was responsible for procuring the main contractor for the Avian Innovation and Skills Centre at SRUC’s Bush Estate, beside SELECT HQ in Midlothian.


CASE STUDY: SCOTLAND’S RURAL COLLEGE A PBA was successfully


used for the delivery of the £5 million facility, and Claire was very positive about the benefi ts it brought to the supply chain. She said: “In view of the


potential consequences and impact on sub-contractors if


40 CABLEtalk OCTOBER/NOVEMBER 2020


a main contractor were to go into liquidation or withhold payments, SRUC was keen to embed the PBA into the terms and conditions for this project. “In doing so, it minimised


potential risk, while providing confi dence of timely payments to both the main contractor


and sub-contractors. T is balanced the interest of all within the construction supply chain ensuring consistent cashfl ows and established fair and transparent payment practices. Once set up, the PBA was easily managed and administered.”


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