Clearview South October 2013 - Issue 143 | Page 24

industrynews

Essential for Prosperity
CAB Chief Executive, Justin Ratcliffe reflects on the recent Government Construction
Summit and argues that we need both Investment and Fair Payment…
“The long awaited Government Spending
Review and Government Construction
Summit in August both gave some new
insight into the government’s construction
strategy to 2025.
“The Review saw £20 billion committed to
schools and £3.3 billion to affordable housing
during the life of the next Parliament. The
Strategy document that followed set some bold
targets to 2025 such as a 33% reduction in the
initial cost of construction and the whole life
cost of built assets. A little lost in the launch
headlines was the promise that there would
be a new Government Fair Payment Charter
before the end of 2013, an issue on which
CAB has lobbied hard for over the years.
I felt, however, that there was a complete
lack of assessment of the construction sector
as it is now and while 2025 is not far away,
for some businesses just getting to 2015 will

‘The industry is failing to
create the conditions for
its supply chains to thrive.
This needs to change.’

24

OCT 2013

be a challenge after at least 5 to 6 very tough
years where volumes have held up but margins
have taken a battering. The announcements
or should I say clarifications of a number
of infrastructure projects did provide some
excellent forward planning information but
the government strategy document does make
the following admission in that, ‘Construction
has been hard hit by the economic downturn.
The impact of this is being particularly felt
among the many small businesses that operate
across the sector. The industry is failing to
create the conditions for its supply chains to
thrive. This needs to change.’
Lack of fair payment is an issue that has
impacted heavily on the sector and this was
emphasised only a few weeks ago on the Today
programme by Debbie Abrahams MP for
Oldham East and Saddleworth who convened
and chaired a cross-party parliamentary
inquiry about how to tackle late payment.
The summary recommendations are listed at
http://www.debbieabrahams.org.uk/2013/latepayments-report-published.
Debbie explained that around £36 billion
was owed to SME businesses, an amount
that affected over 124,000 companies. Sadly

within that figure are a large number of firms
within the construction sector including CAB
members. During the same programme it was
alleged that Tier 1 Suppliers on the whole
were tending to pay on time, but it appeared

‘around £36 billion was
owed to SME businesses’
did not apply further down the supply
chain. The Fair Payment Charter promised
by government is certainly a start but much
more still needs to be done and CAB will be
highlighting the issues and recommendations
within the report and its members’ concerns
at the Construction Products Association
Parliamentary Reception on 22nd October.
The simple fact is that for long term prosperity
in our sector we critically need BOTH
investment and fair
payment.”
Council for
Aluminium in
Building,
Tel. [phone]

To read more, visit www.clearview-uk.com