How does retention work under JCT 2016?

Retention under SBC/Q 2016 is a deduction at the Retention Percentage from the parts of each gross valuation that carry it, held by the Employer, half released on practical completion and the balance on the Certificate of Making Good. The Retention Percentage is three per cent unless the Contract Particulars state a different rate, and the rate the parties inserted governs however the printed default reads. Under the retention provisions in section 4 the percentage is applied to the value of work properly executed and to materials and goods on site and listed off-site items; it is not applied to the amounts the contract adds without retention, loss and expense among them. The Employer holds the retention as trustee for the Contractor, without any obligation to invest it, subject to its right to make the deductions the contract allows, and the Contractor may ask for the retention to be placed in a separate bank account. Release is in two steps. In the Interim Certificate following practical completion the Retention Percentage applied to the work is halved, so half the retention comes back with that certificate. The rest is released in the Interim Certificate following the Certificate of Making Good, when the Architect/Contract Administrator has certified that the defects notified during the Rectification Period have been made good. What goes wrong is that the Retention Percentage in the Contract Particulars is missed and three per cent is applied when a different rate was agreed; retention is taken on the whole gross valuation rather than the parts that carry it; the first half is not released because nobody revalued after practical completion; and the second half is treated as held indefinitely because the Certificate of Making Good was never asked for, when it is the trigger for the release.