BWF urges Government for new approach following Carillion failure

Mr McIlwee’s call comes at the same time as the BWF submits its final comments to the government’s consultation into retention payments in the construction industry.

He said the big issue was whether the government could “in all conscience” turn its back on a supply chain of SMEs who will suffer as a result of Carillion’s failure.

Mr McIlwee said poor procurement, bad business management and an endemic failure by the Government to address archaic procurement practices surrounding late payments and retentions resulted in risk being unfairly borne by SME sub-contractors.

“Many of the creditors are SMEs and the sums, whilst likely to be significantly lower than the liquidators will take, could define the future of these businesses - it would be a gross injustice if their money unfairly held is lost in this process,” he said.

“Frankly to my mind the Government is complicit in the sorry saga that is unfolding and we need decisions fast. As a short term we need to see some security against these retentions and unjust payment clauses.

“Moving forward we urge the Government to develop a structured and more consistent legislative process to deal with market failures, be they banks, construction firms or steel manufacturers.

“We cannot rely on arbitrary decision making and political posturing.”