New Trusted Trader Database and Staged Payments to Tackle 'Cowboy Builders'
The UK government has announced a new database of vetted traders and a staged payment system aimed at protecting homeowners during renovations, with the scheme launching next month. The measures form part of a wider consumer-protection package that also targets rogue bailiffs and private debt collectors (The Guardian; The Sun).
Under the scheme, customers' money will be held in a secure account — similar to how a solicitor holds a deposit during a house purchase — and released in stages after agreed project milestones are met. Traders who sign up must demonstrate standards of customer service, transparency and dispute resolution. The government said more than a quarter of people who carried out home improvements in the past 18 months experienced problems, including builders disappearing after upfront payments were made (BBC News.
A survey conducted for the Competition and Markets Authority (CMA), the UK's principal competition regulator, suggested customers lost more than £10bn in 2024 on home and garden maintenance services through losses, overpriced costs or unfair practices by traders (BBC News). Citizens Advice said home renovations are one of its biggest sources of consumer complaints (BBC News.
Business Secretary Jonathan Reynolds said the government is taking action to protect consumers, support reputable traders and ensure people can spend money with greater confidence and security (BBC News.
The National Federation of Builders said the new scheme would not stop rogue operators. Its director of policy, Rico Wojtulewicz-Richmond, proposed a project 'passport' — a record of all work completed attached to the job rather than the trader — as a better consumer-protection approach (BBC News.
Shadow business secretary Andrew Griffith criticised the announcement as risking extra paperwork for businesses that already do the right thing. He called for tougher law enforcement and sentences for fraudulent traders instead (BBC News.
Liberal Democrat business spokesperson Sarah Olney criticised the voluntary code for tradespeople. She said rogue operators would not voluntarily sign up and the announcement falls short of fixing the system (BBC News.
The voluntary nature of the scheme is the principal fault line across the opposition response. Griffith and Olney approach the problem from different ideological directions but converge on the same structural concern: a database that reputable firms join voluntarily does little to constrain those who operate outside it. The National Federation of Builders raises a separate but related point. A project 'passport' would attach a record of completed work to the job itself rather than to the trader's willingness to register, creating a different incentive mechanism.
For the trades sector, the staged payment model is the element with the most immediate operational implications. Holding funds in escrow — a third-party account that releases money only when conditions are met — until milestones are reached changes cash-flow dynamics for builders accustomed to upfront deposits, and shifts leverage toward the consumer mid-project. How the milestones are defined, and who adjudicates disputes over whether they have been reached, will determine whether the scheme works as a practical safeguard or an administrative burden. The government has not yet published detailed scheme rules.
The widening of the package to cover rogue bailiffs and private debt collectors signals a broader consumer-protection posture from the government rather than a narrowly targeted intervention in the construction sector. That framing matters politically: it allows ministers to present the announcement as part of a cross-economy consumer agenda rather than a sector-specific response to the CMA's £10bn detriment finding.
Consumer-protection regulation in this area sits with the UK government. The devolved administrations in Scotland, Wales and Northern Ireland have not been indicated as part of Thursday's announcement.
