In 2020, the Queensland Government amended the Building Industry Fairness (Security of Payment) Act 2017 (Qld) (BIF Act) through Part 4 of the Building Industry Fairness (Security of Payment) and Other Legislation Amendment Act 2020 (Qld) (BIFOLA). Section 63 of the BIFOLA introduced a new project trust account (PTA) framework in Queensland. The rollout of the PTA framework was set to occur in five separate, distinct phases between 2021 and October 2025. As it currently stands, the PTA framework applies to Queensland Government and hospital and health service contracts valued at $1 million or more and to local government and private industry valued at $10 million or more.
PTA framework rollout history
The commencement dates for rollout of the five phases have been amended many times, including in 2020, 2022 and 2023. As contemplated by the Proclamation on 16 March 2023 (SL No. 16 of 2023), the PTA framework was set to apply to eligible private sector, local government, statutory authority, and government-owned corporations' contracts valued at $3 million or more from 1 March 2025, and from 1 October 2025, to all eligible contracts valued at $1 million or more.
However, on 31 January 2025, the Queensland Government announced further delays to the commencement of the next phases of the PTA framework, citing various barriers to the successful rollout of the remaining two phases. As described in the Proclamation, these include:
- the significant financial challenges being faced by the construction industry, including tight profit margins, poor cashflow, shortages of labour, rising costs and difficulty sourcing materials
- heightened insolvency risks;
- lack of adequate accounting software to support trustees to comply with their obligations under the framework; and
- the need to strengthen smaller contractors' understanding of the PTA framework.
Pausing the rollout of the PTA framework is expected to:
- enable the Queensland Productivity Commission (QPC) to conduct a regulatory review of the building and construction industry;
- provide the Queensland construction industry regulatory relief and sufficient time to prepare for the upcoming changes and compliance demands; and
- ensure that the findings from the ongoing QPC review are considered, with new commencement dates for the framework to be established based on the review's recommendations.
Despite this pause, it is important that principals and builders stay informed with any updates to the rollout schedule.
The team at MinterEllison can assist you in navigating the PTA framework. We remain at the forefront of developments to the BIF Act in Queensland. Please contact us if you would like our assistance.
