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More big clients heed call to drop use of retention clauses in contracts

TRADE contractors' leaders believe nearly 12 per cent of clients and construction companies have now dumped the use of retentions.

Nine more names have joined the Specialist Engineering Contractors Group list of firms that no longer include retention clauses in contracts.

The latest clients to dump the hated system are food giant Aldi, housing associations Arena and Circle 33, DeVere Hotels, the Environment Agency, the Highways Agency, Ikea, Luminar Leisure and Yorkshire Water.

SEC Group chief executive Rudi Klein said: 'Last year, the National Audit Office expressed its disapproval of the practice of retentions by stating they had an adverse impact on the industry's capacity.

'My estimate is that over 12 per cent of construction, by turnover, is now a retentionfree zone. However, there are still too many lead contractors demanding retentions, even where clients are not requiring them.'