Investigating the Causes of Subcontractors’ Underutilisation of the Security of Payment Legislation in Australia

Within the Australian construction industry, small subcontractors are highly vulnerable to insolvency risk due to poor payment practices. The Security of Payment legislation was introduced to ensure that those subcontractors are timely paid for the work they do. However, since the enactment of the legislation in Australia, the utilisation rates of the legislation have been relatively low. Through a desktop study, this paper aims to identify and discuss the main causes of the legislation under-utilisation including affordability, lack of industry confidence, lack of knowledge and awareness, impact on business relationships and limited right to access the regime. Moving further, this paper will acquaint the lead author's PhD study, which aims to address the barriers and solutions to achieve an appropriate utilisation of the security of payment legislation.