What changed
Every Australian state and territory has a security of payment regime that gives contractors and subcontractors a statutory right to progress payments and a fast adjudication process when they are not paid. The regimes differ in detail, and Victoria's was the outlier: it allowed longer terms and excluded whole categories of claim from adjudication. The 2026 amendments remove both differences.
20 business days, all contracts
Payment is due no later than 20 business days after a payment claim is received, regardless of what the contract says and regardless of when the contract was signed. The clock runs from the claim, not from a tax invoice or any other step the payer might wait for.
Excluded amounts abolished
Variations, latent conditions and delay costs can now be referred to adjudication. Claims that used to end in a dispute process now end in a payment schedule and a date.
Already capped
The other mainland states already cap payment at between 15 and 25 business days from a claim, with the detail differing by state and by position in the chain, and Queensland adds project trust accounts on larger jobs. Victoria has joined them rather than led them.
What it means for cashflow
For a head contractor, the change is on both sides of the ledger at once. Claims from subcontractors must be paid within the statutory window whether or not the principal has paid the head contractor. The head contractor's own claim up the chain is also protected, but the two dates rarely line up, and the gap between them is funded by the head contractor.
A head contractor with $80 million of annual subcontractor spend, previously paying on 45 day terms, holds about $10 million of subcontractor payables at any time. At 20 business days, roughly 28 calendar days, that falls to about $6 million. The $4 million difference is working capital the business was using and now is not, on every project, permanently. It is funded by the facility, by equity or by a change in how the payments are made.
- The latest date a subcontractor can be paid after a claim
- That the date runs from the claim, not from paperwork the payer controls
- That variations and delay costs are payable through the same process
- That the contract cannot override any of it
- How the payment is funded on the day it leaves
- Whether the subcontractor is paid by bank transfer from the contractor's own cash or from another source
- When the contractor's own cash actually leaves, as distinct from when the subcontractor is paid
- Whether early settlement is offered for a discount inside the window
Why the distinction matters
Construction has always managed cash by timing: holding subcontractor payments until the principal pays, holding retentions, letting a variation sit until the end of the job. The statutes are closing each of those in turn. Victoria's reform is the most recent and the most complete, and the direction across every state is the same.
What no state regime touches is the method. A subcontractor paid by bank transfer within 20 business days has been paid within 20 business days. Whether the head contractor funded that transfer from its own account, from a drawn facility, or from a commercial card settled at the statement date is the contractor's business. The subcontractor's position is the same in every case. The contractor's cash position is not.
The practical reading. The statute decides when the subcontractor is paid. It says nothing about when the head contractor's cash leaves. For most contractors those two dates have always been the same date. They do not have to be.
What to do
- Re-run the project cashflow on 20 business days. If the model still assumes 45 day subcontractor terms on Victorian work, it is wrong from 15 April.
- Check where the clock starts. Payment claims, not invoices. A process that waits for a compliant tax invoice before starting the count is now a compliance problem.
- Decide how the gap is funded. The difference between the old terms and the statutory window is a permanent increase in working capital need. The facility is one answer. Changing how the payment is funded is another.
The subcontractor is paid on the statutory date. Your cash leaves on the statement.
Flow settles the payment by bank transfer on the date the regime requires, funded on your commercial card, with GlobalFinex B2B as the merchant. The subcontractor sees a bank transfer and a remittance advice. Nothing else about the claim changes.
Sources: Building and Construction Industry Security of Payment Act 2002 (Vic), as amended, commenced 15 April 2026. Building and Construction Industry Security of Payment Act 1999 (NSW). Building Industry Fairness (Security of Payment) Act 2017 (Qld). Building and Construction Industry (Security of Payment) Act 2021 (WA). Worked figures are illustrative. This is general information, not legal advice.