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How much has the government actually done since Carillion’s implosion to address unfair payment practices?
“I am committed to eliminating unfair payment practices and ensuring that we do right by our SMEs.” So said small business minister Andrew Griffiths at a Federation of Small Businesses gathering this week, where minds were no doubt focused on how the aggressive payment tactics, combined with mind-boggling incompetence, of failed giant Carillion threaten to ruin untold numbers of perfectly well-run businesses.
But how much has the government actually done since Carillion’s implosion to address unfair payment practices that are known to be rife on the ground? Evidently, its “Carillion taskforce”, which has met regularly in the wake of the collapse, has discussed payment practices and retentions at some considerable length. Yet in the almost six months since the liquidation we’ve had more talk than action.
The Cabinet Office launched a consultation on proposals to block companies with poor payment records from winning contracts, which closed in early June but has yet to publish the responses. So until we see the details and have a clear idea of the timeframe, it’s hard to judge if this proposal to punish companies that “cannot demonstrate a fair, effective and responsible approach to payment” will adequately tackle such a persistent and deep-rooted problem (we know from the latest publicly available statistics that big-name contractors’ average payment periods greatly exceed the recommended 30 days).
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