Fall Economic Statement 2018: Federal Prompt Payment and Adjudication To Be Introduced

On November 21, 2018, Finance Minister Bill Morneau delivered his fall economic statement for 2018 titled Investing in Middle Class Jobs.  The 150 plus page statement describes a number of announcements regarding the Government of Canada’s fiscal strategy. For the construction industry, the statement contains an announcement in relation to prompt payment and adjudication legislation at the federal level. Specifically, the Fiscal Economic Statement describes (on page 42 of Chapter 2 – Continued Progress for the Middle Class) the introduction of legislation in relation to Prompt Payment for Government Construction Contractors as follows:

The Government is currently modernizing its procurement practices to simplify the process and make it easier for interested businesses to bid on government contracts. As part of this effort, the Government also committed in 2017 to assess and implement changes within its procurement system to ensure that construction contractors and sub-contractors that work on federal projects on federal lands are paid promptly.

Ensuring the speed and efficiency of cash flow down the construction supply chain is fundamental to a healthy construction industry. The timely flow of payments within all tiers on such construction projects is necessary to enable material and equipment suppliers, sub-contractors, and trades and labour to contribute with confidence to federal government projects.

The Government will introduce legislation to implement the prompt payment of contractors and sub-contractors for federal projects on federal lands as well as the adjudication of payment issues. [emphasis added]

We look forward to working further with PSPC in respect of this legislation.

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