Late payments in the construction industry have long plagued and even killed the livelihood of contractors big and small.
It is an issue that is only now being brought to light.
Earlier this year, CN’s report on average payment times for 19 of the biggest 20 contractors revealed average payment-terms to be 47 days.
Late payment by large contractors is an issue that has gained considerable attention in the wake of Carillion’s collapse, not only in the press but also with a targeted parliamentary inquiry.
This week however has seen Mace chief executive Mark Reynolds call for the spotlight to be turned on the payment records of clients, too, in the overall effort improve payment throughout the supply chain.
‘The visibility is in the construction sector, but not in the client sector,’ Reynolds said.
This sentiment has been echoed by various other tier one contractors. Officials from both Laing O’Rourke and Kier spokespeople have recently spoken out against clients with poor payment records, including amongst them the government.
Mr Reynolds adds that he was ‘absolutely wrong’ in his previous support for Carillion’s controversial early payment facility, which offered the chance of 30-day payment terms at a cost of 2-3% of the final sum.
The issue is indeed gathering political traction in recent months; the Department for Business, Energy and Industrial Strategy has called for evidence on tackling late payments.
This news comes just months after its small business survey in May found that construction companies were more often affected by late payments and most likely to find it a ‘major obstacle’ to growth.
When tackling late payers it’s imperative you have the right people on your side. CRS are specialists in dealing with late payers in the construction industry, with a proven track record of taking on the most problematic of debts.
Don’t hesitate; give us a call today for a free ‘no-win no-fee’ consultation.