The Low Down on Construction – September 26
As we all know, construction is one of the primary drivers of the economy. In Saskatchewan, construction is the third largest employer behind only the retail and health sectors. Our industry provides a direct contribution of about 8% to the overall provincial GDP
However, for the construction industry to continue to thrive we need to find a solution to a growing problem among contractors – late payments.
Trade contractors are commonly made to wait four months or longer to be paid for work that has been certified as being complete. This represents an unfair transfer of financial risk from owners and developers to the trade contractors.
As entrepreneurs, we understand there is risk in all business transactions, but in the construction industry, the issue of late payment has become commonplace. The average payment for construction work is Canada is 71.5 days but it has been known to stretch to 120, 150, or even 200 days .
Prompt payment legislation will help solve this issue. Unfortunately, Saskatchewan and Canada lag behind a majority of other jurisdictions who already have prompt payment legislation in place.
To look deeper into the issue, the Prompt Payment Saskatchewan Group was formed in January by industry association leaders. Their focus is to work together to resolve the issue of late payments in the Saskatchewan construction industry.
We believe that the solution to late payments in the construction industry in Saskatchewan is Prompt Payment Legislation. Without Late Payment Legislation, the construction industry will see a rise in overall construction costs, a strain in cash flow and restricted new job creation and investment in apprenticeship training.
We will continue to support this important initiative and lobby the government to adopt the Late Payment Legislation as it will benefit our membership and the future of the construction industry in Saskatchewan.