8 Mar 2013

Disclosure of Mainzeal retention payments wanted

2:49 pm on 8 March 2013

A group representing sub-contractors is calling on the liquidator of Mainzeal Property and Construction to reveal how much money is being held in retentions.

Mainzeal went into receivership on 6 February this year.

Retentions are a common industry practice, where a firm withholds part of a sub-contractor's payment as a maintenance guarantee for work done.

The president of the Specialist Trade Contractors' Federation said on Friday it appears about a third of the money Mainzeal owes to sub-contractors is in retentions - and that is likely to total millions of dollars.

Graham Burke said liquidator BDO should disclose this sum.

Mr Burke also wanted urgent changes to the Construction Contracts Act so that retention payments are secure should the main contractor run into problems.

A spokesperson for BDO expects retentions to be included in its report, due out next week.