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ECA and BESA push for “positive” payment reform progress in 2018 Budget

Chancellor Philip Hammond will deliver the latest budget next week with building services bodies setting out five key priorities that they hope to see addressed

The building services industry is calling on Chancellor Philip Hammond in his upcoming budget to make clear commitments to enforce prompt payments and reform current cash retentions policy in order to protect SMEs in the sector.

BESA and the ECA have issued a joint statement setting out five priorities they hope to see addressed when the Budget is delivered on October 29.

These priorities include:

  • Pushing for government to formalise prompt supply chain payment when selecting larger suppliers for services, with specific rules introduced to exclude bidders that fail to pay within a 30-day period
  • An overhaul of cash retentions policy that would protect organisations from upstream insolvency
  • Additional incentives for businesses to invest in low or no carbon energy projects
  • A simplified off-payroll working process for the employment status test ahead of any work to impose new compliance processes on businesses
  • Greater investment in technical training and ongoing skills programmes, while also maintaining non-levy funding of apprenticeships

Alexi Ozioro, public affairs and policy manager with BESA, said some of these key priorities had raised with the chancellor and his team over the party conference season.

He added that the organisation had been pushing for direct enforcement of 30-day payments, with punitive measures for any failure to comply.

Mr Ozioro said that while some of these commitments were not within the chancellor’s sole remit to address, a statement in the budget on clear legislation would send a strong signal for industry.

He said, “Government have now announced five-day payments, try sorting out 28 before this.”

Mr Ozioro added that the organisation hoped for a positive budget that would build on its recent engagement with the Treasury.

He added, “ The chancellor has made clear he wants to tackle late payment, improve productivity and level the playing field for SMEs. Alongside our calls for retentions reform, it would be positive to see government supporting new skills the industry needs for modern construction; like offsite, modular and green building.”

Steve Bratt, chief executive of the ECA, said the calls aimed to ensure SMEs were better supported in a challenging market and able to deliver jobs and increased productivity.

He added, “Now is the time to make structural reforms to ongoing but fundamental SME concerns such as late payment, while reducing business burdens and investing in future capacity and the low-carbon economy.”

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