ACE, as part of the Construction Leadership Council, has called for the whole industry to help itself by boosting the flow of cash through the sector.
The council, which brings together the diverse industry federations from across the supply chain as part of the COVID-19 Construction Taskforce, has issued an open note to construction businesses asking for the industry to help itself by ensuring money flows through to all parts of the industry.
In the letter, the CLC has outlined the extraordinary difficulties faced as a result of the COVID-19 crisis and reminded the industry that these difficulties will only be worsened if disputes and penalties are invoked throughout the sector and if firms sit on cash meant for their suppliers.
The letter also notes that where the industry is asking for substantial support from the government, it is less likely that this support will be forthcoming if the sector has not demonstrated that any benefit will be fairly distributed to all parts of the industry. It also warns on the reputational damage to individual businesses that seek to withhold cash or punish contractual partners.
Andy Mitchell, co-chair of the CLC said: "We are increasingly concerned about the management of payment in the supply chain. All construction businesses should continue to pay in accordance with agreed contractual terms and firms should not be threatening to invoke penalty or other contractual clauses. Our joint priority must be to sustain the industry. All firms should think hard about how their reputation could be damaged by not doing the right thing during these difficult times.”
Download the letter below.