Helping you to understand the relevant payment legislations in our sector

The payment mechanism for Construction Contracts is governed by the Housing Grants, Construction and Regeneration Act 1996 (also known as the Construction act) - keeping up-to-date with the relevant legislation ensures your business stays compliant with the payment processes in the construction industry.

The Construction Act

The Housing Grants, Construction and Regeneration Act HGRA, commonly known as the Construction Act, aims to ensure that payments are made promptly throughout the supply chain and that disputes are resolved swiftly.

BESA members have access to a suite of precedent notices and letters together with detailed guidance on the Construction Act.



From April 2017 large businesses in the UK are required to report on their payment practices, policies and performances under the Small Business, Enterprise and Employment Act 2015. 

The reporting duty will be mandatory for companies with an annual turnover of more than £36 million, balance sheet total more than £18 million and more than 250 employees. This allows suppliers of those companies reporting to assess their clients’ trading risk based on their payment performance. 

BESA members have access to our guidance on reporting payment performance


project bank accounts

Project Bank Accounts (PBAs) are a cash disbursement model that allows money to be ring-fenced in bank accounts from which payments are made directly to suppliers.

This reduces the risk of contractor insolvency and the consequent disruption to projects. It also cuts out much of the additional cost of risk pricing and debt management associated with having multiple layers of payment within the contractual chain.

BESA are lobbying for PBAs to be the preferred method for improving payment conditions in the UK.   

Paul Tuson

Managing Director, Lowe and Oliver Ltd

The legal and commercial team at BESA have successfully supported Lowe and Oliver on a number of commercial issues and contract reviews, saving us thousands against the traditional very expensive route of external legal support.

This alone is worth our BESA membership fees and we would happily recommend this service to other member companies.  

The BESA continue to lobby on members behalf for fairer and more transparent payment practices - visit our Representation pages to find out some of the key issues the association is working towards.

Visit our Representation area

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