If ever there was a time for clear and unambiguous leadership in the construction industry it’s now
RECENT tragic events have very publicly highlighted what happens when we get construction wrong, but what we don’t see is all the things that are wrong with construction in the UK but are hidden away under the surface.
As flooring contractors, you know that no amount of hard work on your part will enable you to overcome problems lurking under the surface in the substrate. If that substrate is defective what’s the point of covering it with a decorative covering?
But sadly, that is what I see in a construction industry that is almost unrecognisable from the one I joined 47 years ago!
Worse still we seem to have developed a culture of spin, and BS, and smoke and mirrors that is not only infuriating it is actually exacerbating the problem.
The elephant in the room
In the June issue of CFJ Richard Catt talked about not one, but a whole herd of elephants in the room the biggest of which being payment. And I wholeheartedly agree with him.
While the industry is facing a whole host of issues, payment is by far and away the biggest. If you don’t get paid you don’t have a business.
If you spend most of your time trying to get paid you have less time to address all the other issues that need your attention, and as for planning for the future, you probably can’t think beyond the end of the month.
So, why are we as an industry failing to recognise this and why isn’t it being properly addressed?
Because it’s the elephant in the room, it is such a major problem and such a controversial issue. And regrettably even when it is discussed the truth seems to be largely absent.
Here are some facts
Streetwisesubbie recently supported a piece of academic research that is statistically significant with 502 respondents, some 354 of whom were sub-contractors, over 70% of which had a turnover exceeding £1m. Here’s what the survey uncovered;
A total of 87.17% of subcontractor’s main issue of dispute was regarding payment, compared to 64.21% of contractors suggesting Contractors receive payment within the agreed terms more frequently.
Even on public sector projects only 25% of subcontractors were paid on time, and on private sector projects that fell to 15%.
Subcontractors were subject to set off on 88.7% of their projects and between 9 and 34% (depending on turnover) said they were subject to set off on every project!
95.66% believed neither government nor the trade bodies were doing enough to tackle the problems in the industry.
So, what’s to be done?
Let’s start by cutting out the spin, and the BS, and the smoke and mirrors!
David Strydom recently asked Build UK:
What are your views on the fair payment issues facing the industry?
In my view, the answer shows just how far away from reality Build UK has become. For those that missed it here are some extracts from their answer, along with my thoughts:
‘To start with, it was challenging to ensure that those around the table felt comfortable having difficult conversations, but we reached a position where all parties could discuss the challenges much more quickly than we had anticipated.’
Contractors don’t pay their subcontractors properly. What’s difficult about saying that?
‘One of the first steps we took was to agree the principles of best practice payment terms in construction.’
Everyone knows what good payment looks like! Pay on-time and value fairly.
‘Before Build UK embarked on this work, no contractors had signed the Payment Charter – we now have five of our contractor members signed up. Now, I know that there is still more to do…’
There are 25 contractor members, and the charter isn’t even legally enforceable. So there definitely is a whole lot more to do.
‘And finally, the Duty to Report on Payment Practices legislation which requires all large companies to report on a range of metrics associated with their payment practices every six months will allow us, from next year, to benchmark our contractor members against one another to introduce real transparency for the supply chain.‘
And pigs will fly! The regulations are so woolly, they won’t tell anyone anything, and they certainly won’t be reporting on under-certification and wrongful set off.
Your president’s passion
Like your president, I’m passionate about protecting CFA members, and indeed all specialist contractors. And I believe David and Richard when they say they’ll be actively lobbying for change and faster progress in Build UK.
As to whether an organisation that represents all sides of the industry can ever deliver the massive culture shift required to rid this industry of its morally bankrupt payment practices, I have my doubts. After all the ‘anti-fox hunting/pro-fox hunting association’ doesn’t sound like a group that’s going to please any of its members!
So, are we altogether now?
Maybe we can leave the last word to the lyrics of the Farm song ‘Altogether Now’:
‘All together now
All together now
All together now, in no man’s land
The same old story again
All those tears shed in vain
Nothing learnt and nothing gained
Only hope remains’
RIGHT OF REPLY
It was Winston Churchill who said to jaw-jaw is always better than to war-war and I subscribe to that theory.
Build UK would never seek to comment on how another organisation goes about its business, particularly one that shares our ambition of achieving fair payment and a better construction industry.
We prefer to use our energy and resources in dealing with the problem and we believe that this can be achieved by bringing the whole construction supply together.
The limited progress on this issue over the years is because the supply chain has, up until two years ago, always worked in isolation.
I’ve always said Build UK has no monopoly on achieving fair payment and by focusing on our shared ambition we’re more likely to achieve it. If someone has a better idea of how to achieve fair payment then we want to know about it.
Whether it’s the Build UK idea, the Streetwise Subbie idea or anyone else’s idea isn’t the issue; if between us we can achieve the end-goal everyone will benefit. – Suzannah Nichol, ceo, Build UK