The National Federation of Builders (NFB) has blasted the payment practice data recently released by Build UK as showing not only their failure to follow best practice but also its “utter disregard” for SMEs
Under new government transparency rules, Build UK has published details concerning the payment practice of its top 24 member companies.
The data reveals that top contractor members of Build UK take more than 30 days to pay invoices. This takes place despite Build UK members having signed up to the Construction Supply Chain Payment Charter, aimed at ensuring standard payment terms of 30 days and abolishing retentions.
Build UK Chief Executive Suzannah Nichol greeted the data in the table as a “bold first step” in showing that industry leaders are “serious about changing the way they do business”, while Implementation Minister Oliver Dowden MP said that “Build UK is leading the industry by publishing its members’ payment performance table.”
NFB refutes the assertions made by Build UK. The payment practice data published by Build UK show not only their failure to follow best practice and fulfil a legal requirement to pay clients within 30 days, but utter disregard for small and medium-sized (SME) businesses and regional contractors.
After the collapse of Carillion and recent reports highlighting that almost nine out of ten councils are breaking prompt payment rules, the NFB have said they are “astonished” to see a Government minister praising Build UK for barely fulfilling its legal obligations.
Neil Walters, national chair of the NFB, said: “Fair practice is essential to changing the industry culture around payment, not transparency. Transparency is a legal requirement, not a bold step. Procurement regulations already require 30-day payment terms down the supply chain, but the first thing tier one contractors do is change the contract terms to suit their interests and all but force SMEs to sign the amended terms to get paid.
“Seeing Build UK portray tier one contractors like industry pioneers is the ultimate insult. Build UK members, who make up less than 1% of the construction industry, are failing the 99%.”
