Finance Minister Sammy Wilson today outlined how the introduction of a new payment method will help safeguard subcontractor payments in many government construction contracts.

From January 2013, Project Bank Accounts will be introduced in government construction contracts awarded by Central Procurement Directorate on behalf of government departments.

Major first tier subcontractors working on a project will no longer have to wait for main contractors to process their payment; instead they will receive it directly through a bank account specific to the project they are working on. This will see subcontractors working on Government projects receiving payment in five days or less from the date the client deposits funds in the Project Bank Account. It will also help to protect their money in the event of the contractor entering administration or receivership as the money is held in an account in trust for the supply chain.

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Mr Wilson said: "The Executive recognises the strategic importance of the construction industry for Northern Ireland and the key role which is played by subcontractors. This is why we are significantly changing the way we pay many firms working on government construction contracts.

"Project Bank Accounts will accelerate their cash flow, and give certainty of payment timing. They will also allow the benefits of public investment to be pushed further down the supply chain to subcontractors who, in many cases are fundamental to the work on many construction contracts."

(CD/GK)