A new government-backed Supply Chain Charter aimed at improving construction’s payment culture will be launched next month – with the hope that it will add impetus to the trend of public sector clients assessing contractors’ payment record in bids.
The imminent launch was highlighted in chief construction adviser Peter Hansford’s keynote address at Talk Construction yesterday.
Hansford said the Charter would “provide a clear statement of the industry’s expectations on payment” and would address persistent problems with non-payment and under-payment as well as late payment.
Asked by Reading University’s professor Will Hughes if government clients would in future only contract with suppliers that paid suppliers responsibly, Hansford said that the Charter “could be the driver that results in clients making those sorts of decisions and I would support that”.
The Charter is being drawn up by the Institute of Credit Management and overseen by the Construction Leadership Council, established to implement Construction 2025, the joint industry-government Industrial Strategy for Construction.
The 30-strong CLC has so far met in June and October, but Hansford pointed out that it is being supported by a Delivery Group – made up of senior industry figures and senior civil servants – that is meeting six times a year.
This group, Hansford also told the conference, is developing a new implementation plan to support Construction 2025, which would be launched in February 2014.
The plan will elaborate on the thinking behind the over-arching 2025 targets – 33% reduction in costs compared to a 2009/10 benchmark, 50% faster delivery, 50% less carbon and a 50% reduction in the trade gap – and set interim targets and KPIs to measure them against.
Other priorities for the Delivery Group would be:
- extending the two-year old Open Doors event beyond the membership of the UK Contractors Group, allowing more companies and sites to participate in the out-reach programme
- encouraging construction companies to participate in the Big Bang schools science fair to be held next March.
Overall, Hansford painted a picture of the Industrial Strategy as “an opportunity to transform the industry and position it at the heart of economic growth”.
Earlier, the conference heard from Iain Wright, shadow minister for business, innovation and skills, who gave strong backing to the policy objectives set out in the Industrial Strategy, also highlighting its focus on export growth.
Wright said: “Construction is an important part of the economy, and it could contribute a lot more. The UK has 13 of the largest contractors in the European Top 50 [Deloitte, European Powers of Construction 2012], and we’re keen to see that strength turn into overseas sales."
He went on: “The Strategy’s analysis is impressive and robust, its targets are challenging but achievable. I welcome the long-term focus up to 2025 and the fact that the industry can use that policy certainty to plan and invest. So I hope it can transcend party politics and successive governments to give you policy certainty.”
However, Wright commented that Construction 2025 could have had a closer linkage with infrastructure policy.
He added that shadow chancellor Ed Balls had last week asked Sir John Armitt to produce a White Paper setting out in more detail how the Armitt Review’s idea for an independent and cross-party National Infrastructure Commission could be set up and run.
