THE CONSTRUCTION LEADERSHIP COUNCIL (CLC) says it welcomes the Government’s proposals to improve industry payment practices.

The government consultation, the Prompt Payment and Cashflow Review, which closed at the end of last month, reviewed the current payment landscape and its impact on SMEs.

The CLC response is that the organisation is “open to further policy change if proportionate”.

Key points of the CLC’s response included:

Agreement that the current regulations on payment practices and cashflow should be extend beyond 6 April 2024.
Agreement that the current regulations should be amended to report on the total monetary value of payments as well as their volume.
Agreement to include further information on retentions in payment practice and performance reports as an interim solution until their abolition.
Agreement that the regulations should apply to clients too.

Reform in Payment Practices

The CLC is led by representatives from main contractors, which are often at the head of procurement chains in the UK construction industry.

Steve Bratt, Chair of the Business Models Workstream, said: “As an industry we have taken substantial steps to date to improve the payment landscape for our supply chain.

“Our mission as CLC is to provide sector leadership to the construction industry which is comprised of over 90 per cent of SMEs.

“As such we support the direction of travel in driving further reform in payment behaviours and we are committed to exploring whether the concept of measuring monetary value could be incorporated into the future monitoring of payment practices.”

“The payment landscape within our sector remains fractured. The CLC remains focused upon further reform if proportionate and workable and are keen to continue to work with government to drive change as it develops the detail and metrics for measurement to support these proposals.”

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