Government plans to ban cash retentions in construction contracts aim to “prevent the abuse of retention payments in construction”, signalling a major shift in how risk and defects liability are managed across UK projects. The move would directly affect standard forms such as NEC and JCT, where 3–5% retentions are commonly withheld through practical completion and defects periods. Contractors and subcontractors could see significant changes to cashflow, security instruments (bonds, project bank accounts) and commercial negotiation of quality and defect-remedy provisions.

Government has launched a 12-week consultation on merging the Construction Industry Training Board (CITB) and Engineering Construction Industry Training Board (ECITB) into a single Industry Training Board covering construction and engineering construction across England, Scotland and Wales. The consultation, open until 23:59 on Sunday 14 June 2026, seeks views on governance, levy arrangements (including extending levy orders beyond the current three-year maximum), and the scope of employers covered. The move follows Mark Farmer’s 2023 ITB review, which called for a merged, employer-led body focused on attraction, training, retraining and retention to address structural workforce shortages.

Government plans to ban retention withholding in construction, cap payment terms from large firms to small suppliers at 60 days, and mandate late-payment interest at 8% above the Bank of England base rate written into contracts. The Small Business Commissioner would gain powers to investigate suspected poor payers, adjudicate disputes outside court, and levy “significant” fines in the tens of millions, plus force large companies to publish explanations for poor performance. Construction bodies, including the National Federation of Builders, are pushing for alternative performance mechanisms such as accessible surety bonds or insurance during the consultation on the retention ban’s implementation.