At Nova Scotia’s Annual State of the Province Address on February 6, 2019, Premier Stephen McNeil shares his enthusiasm and support of legislating a new prompt payment policy that will ensure the timely payments of contractors and subcontractors throughout the province.
With his announcement, Premier McNeil noted the positive response his provincial caucus has had towards the development of legislation that enforces a process that will resolve payment delays in the construction industry. With this commitment, we can look forward to Nova Scotia’s Spring session, where we hope to receive a more detailed plan of action from the provincial government regarding prompt payment.
Why is prompt payment legislation important?
The Builders’ Lien Act is Nova Scotia’s existing legislation that addresses construction law for the entire province. However, it remains extremely outdated and does not address the current challenges Nova Scotia’s construction industry faces.
“The existing law in Nova Scotia—the Builders Lien Act—is costly, cumbersome, and inaccessible to 65 per cent of the construction industry (small and medium-sized family-owned companies consisting of 50 or fewer employees),” says Duncan Williams, president of the Construction Association of Nova Scotia (CANS) and another member of the Coalition. “It addresses non-payment as opposed to delinquent payment and the lien rights of many in the industry will expire long before they realize they will not get paid.”
The positive impacts of modernizing the Builders’ Lien Act to include prompt payment and adjudication processes will mean a healthier construction industry in Nova Scotia. Some of these changes will include:
- Improving the movement of money in our economy.
- Increasing fairness and transparency.
- Increasing efficiency and productivity.
- Lowering the cost of construction projects, public and private.
- Reducing burden on our judicial system.
- Driving investment, employment, training, innovation and purchase of equipment (i.e. apprentices).
- Increasing competition and number of bidders on public work.
- Allowing contractors to bid more work.
Nova Scotia is yet another province that has come forward with a commitment to implement prompt payment legislation. Since Ontario enacted Bill 142, the Construction Lien Amendment Act in 2017, Manitoba’s construction industry has also successfully passed its second reading for Bill 128, the Prompt Payments in the Construction Industry Act. Additionally, Saskatchewan’s government has also announced their intention to enforce amendments to their current Builders’ Lien Act that will ensure invoices are paid within a 30-day window.
The CISC remains active in advocating the modernization of the current Builder’s Lien Act in Nova Scotia. Through joint efforts with the Nova Scotia Prompt Payment Coalition, we continue to create awareness within our communities and educate all levels of government of the importance of prompt payment legislation.