The Construction Industry Coronavirus Forum and Construction Scotland have urged the sector to step up and ensure payments are made on time to safeguard cashflow and ensure business and job survival north of the border.
As trade and professional bodies continue to pull out all the stops and the Scottish and UK government provides additional support to keep companies going, the two bodies stressed that the industry must prove that it is trying to help itself.
Alan Wilson, chair of the CICV Forum and managing director of SELECT, said: “The construction sector is facing extraordinary difficulties at the moment and these problems will only be exacerbated if everyone delays or simply refuses to pay their suppliers.
“There has been some evidence that some businesses have chosen to delay payments or extend credit terms, which is quite unacceptable – and wholly the wrong response to the current situation.
“Put simply, we will only come out of this with a viable construction sector if the cash keeps flowing and businesses which are the lifeblood of the economy can maintain enough liquidity to meet their own commitments.”
Ken Gillespie, chairman of the Scottish Construction Industry Leadership Group, said: “Cashflow works if everybody in the chain plays their part. It is vital for everyone, especially at a time like this to ‘pay it on’, and enable others to pay their bills as well.
“The industry has already shown that it can act in concert and now it has to recognise that it is vital that invoices are paid on time. It’s the one really constructive thing everyone can do to keep the industry alive.”
Wilson said the importance of the construction industry to Scotland was illustrated by the fact that it employs more than 175,000 people, or around 10% of the total workforce. It contributes £21.5bn to the country’s GDP and acts as a strong economic multiplier, with £2.94 generated for every £1 spent on construction output. Vitally for the industry’s future, it also supports around 10,000 apprentices.
The latest move by Scottish industry leaders follows a similar call by the CLC for the industry to help each other by boosting the flow of cash through the sector.