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Bodies calls for Scottish construction sector to play its part in ensuring cashflow integrity

Posted: 1st May 2020

Two construction industry bodies have joined calls for the sector to step up and ensure payments are made on time to safeguard cashflow and ensure business and job survival.

As trade and professional bodies continue to pull out all the stops and Scottish and UK governments provide additional support to keep companies going, the Construction Industry Coronavirus (CICV) Forum and Construction Scotland stressed that the sector 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 anyone delay or refuse 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 Construction Scotland 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. Paying bills means that we will have a viable industry when we begin to come out of the current situation”.

The construction industry in Scotland employs more than 175,000 people, or around 10% of the total workforce.

It contributes £21.5 billion 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.

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