SEC Group Wales/Cymru has identified three critical areas requiring attention, cashflow, site safety risks and interruption to supplies of materials and components.
Many firms in Wales are now running out of cash. Some of this is due to payments taking longer or not being made at all (especially if sites have been closed). SEC Group Wales/Cymru has invited the First Minister to:
- challenge Welsh public bodies to ensure that their tier 1 suppliers are making payments (including retention monies) to firms further along the supply chain and, if necessary, institute direct payments to sub-contractors;
- if they haven’t done so already insist that public bodies in Wales use project bank accounts for projects over £2 million which ensure that sub-contractors will get paid;
- invite leading private sector client organisations which regularly procure construction work (e.g. the supermarkets) to provide assurances that they will monitor supply chain payments.
Subcontractors are being placed in a very difficult position where they wish to cease an activity or withdraw from site because of fears for the safety of their employees. In this situation they are threatened with contractual claims for any resulting delay/disruption to the works. SEC Group Wales/Cymru is urging Welsh Government to warn large tier 1 suppliers that their behaviour during the current emergency could affect their ability in the future to obtain public sector work.
Welsh Government is asked to begin a dialogue with manufacturers, suppliers and distributors in Wales to encourage them to ensure as much as possible the availability of construction materials, components and equipment. Again, subcontractors are having to bear the risk of non-availability of materials etc.
Speaking on behalf of SEC Group Wales/Cymru, its chairman Peter Davies said he was keen to work with the First Minister to help in promoting measures to help SMEs in Wales:? “All the added value in Welsh construction is provided by SMEs and our priority now is to ensure that we have the right measures in place to secure their long-term survival.”
Dave Kieft, formerly President of the Electrical Contractors’ Association, added:? “The Welsh Government acknowledges that construction is part of the foundational economy providing essential support for the well-being of all of us. We want the industry to be in a fit state to continue to play this role and not be overwhelmed by the problems we are now witnessing during this emergency.”