The Chancellor’s announcement of a new consultation on late payment should be the beginning of the end for unfair payment practices which hit small businesses across the UK, the Federation of Master Builders (FMB) has said in response to the Chancellor’s Spring Statement.
Brian Berry Chief Executive of the FMB said, “The Chancellor’s announcement of a consultation to tackle the scourge of late payment today should mark a turning point on this issue. We should use this opportunity to bring about a spring clean of payment practices which negatively impact on small business. Construction giant Carillion’s collapse at the start of the year brought to light once again the need to eliminate poor payment practises that plague the construction sector particularly.
“Indeed, one London based small building firm was once paid more than 270 days late by a construction giant. Now is the time to move away from these unsustainable business models which threaten the existence of many firms and their supply chains. This announcement today should be followed by a fundamental rethink ending in the permanent abolition of late payment terms and the exploitative use of retention payments.
“At first glance the Spring Statement has brought some other positive announcements for the UK’s small construction firms. The announcement of a doubling of funding to the Lloyd’s Housing Growth Partnership and an additional £80 million funding to support SME firms looking to engage an apprentice is welcome news. With Brexit looming large on the horizon and the construction industry facing a chronic skills crisis, it’s of the utmost importance that more skilled workers begin to join the sector. An additional £50 million to support T level training will further aid this aim.”