Businesses in the construction industry can now demonstrate their commitment to fair payment by becoming a signatory to the Construction Supply Chain Payment Charter.
The GGF as Members of Build UK supports the principles of the Payment Charter, which clearly sets out the existing public sector requirement for payment within 30 days, alongside payment terms of 45 days for private sector projects reducing to 30 days by 2018. The Payment Charter also includes clear commitments in respect of retentions, ‘pay less’ notices, variations and Supply Chain Finance schemes.
By signing up to the Payment Charter, a company agrees to apply the commitments in its dealings with its supply chain, to be monitored on its compliance in line with the new statutory reporting requirements when they come into force later this year, and to consider the performance of its supply chain when awarding contracts.
With current payment practices holding back the industry and affecting the businesses of both Main and Specialist Contractors, fair payment has been identified as a priority for Build UK and they are working to set out what best practice looks like. The Payment Charter is one of a series of measures being taken forward which together have the potential to fundamentally change the payment culture within construction.
Nigel Rees, GGF Group Chief Executive commented,
“The Supply Chain Payment Charter can only help companies build strong long term relationships with their supply chain partners and understand the importance of prompt payment to them. Companies signing this Charter voluntarily are making a positive step towards creating more transparency in their payment performance and processes while creating the right conditions for the industry’s supply chain to grow and thrive.”
To apply to become a signatory to the Payment Charter, a company must first sign up to the Prompt Payment Code (PPC). Signatories to the PPC that operate in the construction sector will then be listed in a drop down menu on theConstruction Supply Chain Payment Charter website and they will be validated before being sent a link to the online application form for the Payment Charter. To sign up to the Payment Charter, companies will need to provide information on their standard payment terms, retentions and any supply chain finance scheme they operate.
Once approved, signatories to the Payment Charter will be listed on the website and can use the Payment Charter logo on their own website and documentation to show that they follow good payment practices.
To find out more about the Construction Supply Chain Payment Charter please visithttps://www.promptpaymentcode.org.uk/cscpc.htm