Although the King’s Speech on 13 May was somewhat overshadowed by events in Downing Street, it included significant announcements in the field of construction law, placing the sector firmly on the agenda for 2026 and beyond.

In this insight, we outline the key legislative developments that registered providers (RPs), local authorities (and more generally, employers under building contracts) should be aware of following the King’s Speech.

Small Business Protections (Late Payments) Bill

Described by the Government as the “largest crackdown on late payments in over 25 years” in its policy press release, the Bill is currently progressing through the House of Lords and is intended to improve cash flow for small and medium-sized businesses, many of which operate within the construction sector in England and Wales.

While amendments may be made before the Bill receives Royal Assent, several proposed reforms are likely to affect RPs (as employers under construction contracts).

• Mandatory 60-day maximum payment terms (from the point payment becomes due). RPs may already be familiar with mandatory 30-day payment requirements introduced by the Procurement Act 2023.
• A ban on retention payments. The draft Bill is broad in scope, proposing to prohibit employers from withholding retentions on construction payments through the insertion of new sections 113A–113C into the Construction Act 1996 (subject to a two-year transitional period). The prohibition appears to be unqualified, with no exceptions beyond the transitional period.
• Mandatory interest on late payments at 8% above the Bank of England base rate. While RPs may recognise this rate from goods and services contracts under the Late Payment of Commercial Debts (Interest) Act 1998, the Bill expressly prevents contractual exclusion of interest. It also proposes enhanced enforcement powers for the Small Business Commissioner, including in relation to interest payments, late payment practices, reporting obligations and financial penalties. Late payment provisions are therefore intended to be supported by regulatory enforcement.

The Bill remains at a relatively early stage, and its progress will require close monitoring. However, RPs may wish to consider the following potential implications for their construction contracts:

• Alternative forms of security (e.g. parent company guarantees, strengthened collateral warranties, defects bonds);
• More stringent pre-practical completion requirements and handover procedures;
• Clearer stage payment mechanisms, with controlled or phased certification by the Employer’s Agent/Contract Administrator;
• More robust defects rectification processes, including defined timescales, use of third-party contractors and cost recovery as a debt.

The current iteration draft Bill can be accessed here for reference.

Remediation Bill

Although limited detail was provided in the King’s Speech, the Government confirmed its intention to introduce legislation to “speed up remediation for people living in homes with unsafe cladding”.

Since the Building Safety Act 2022 and related measures, stronger controls and enforcement mechanisms have been introduced to address defective cladding. These include Building Liability Orders, Remediation Orders, extended limitation periods under the Defective Premises Act 1972 and new liabilities for construction product manufacturers.

However, these reforms are widely regarded as insufficient or fragmented, and in some respects limited in scope – for example, by applying primarily to buildings over 11 metres in height. As a result, although progress has been made, many residents continue to face delays, with reports indicating that remediation works can take several years.

It is anticipated that the proposed Remediation Bill may:

• Introduce stricter sanctions for responsible parties who fail to remediate defective cladding within prescribed timescales;
• Impose broader duties on building owners to monitor, report on, and address defects (not limited to cladding), raising potential interaction with the concept of habitability under the Defective Premises Act 1972;
• Expand rights for developers and contractors to pursue construction product manufacturers directly for remediation costs.

RPs should monitor further developments closely, both in terms of their own remediation obligations and potential new avenues of recovery against product suppliers.

Responsible Actors Regulations

Sections 126–129 of the Building Safety Act 2022 empower the Secretary of State to establish “building schemes” comprising developers and contractors (as members), with associated membership requirements and enforcement mechanisms, including sanctions against both members and non-members.

These schemes form part of the broader enforcement framework for addressing cladding and other safety defects.

The first such scheme was introduced in 2023, when the Government required major developers to join a remediation contract addressing fire safety defects in higher-risk buildings. This was implemented through the Building Safety (Responsible Actors Scheme and Prohibitions) Regulations 2023.

Amendments to these Regulations have been tabled in 2026. These appear primarily to clarify drafting and correct errors, rather than introduce substantive reform.

However, in light of the proposed Remediation Bill and the Government’s focus on accelerating remediation, further amendments or new regulations may follow, potentially introducing more stringent enforcement measures against developers and contractors.

This is relevant to RPs as part of the wider package of building safety reforms expected in 2026, particularly from:

• A commercial perspective, when selecting development partners; and
• A regulatory and procurement perspective, given the risk of developers being excluded from the market.

Conclusion

The King’s Speech signals a move towards greater accountability, faster remediation and improved payment practices across the construction and housing landscape. For RPs and local authorities, these proposals are part of an increasingly interconnected regulatory framework that spans procurement, building safety and commercial risk.

Early engagement will be key as these measures evolve. Reviewing contract structures, supply chain relationships and risk allocation now will put organisations in a stronger position to respond to legislative change and maintain delivery momentum.

How Capsticks can help

Capsticks’ construction and building safety specialists support clients throughout the lifecycle of development projects, from business case preparation to completion. We advise on construction strategy, procurement and the appointment of professional teams and contractors. Our experience covers all major standard form contracts, including NEC and JCT, as well as bespoke contractual arrangements, sub-contracts, consultant appointments and collateral warranties.

If you have any queries about the developments discussed in this insight or their impact on your projects, please contact Partner Spencer Vella Sultana or Senior Associate Wilton Thomas.