ABSTRACT
Ensuring that all members of the supply chain have sufficient cash to fund their businesses is one of the most challenging aspects of construction. Most payment mechanisms are designed so that parties should be paid with 30 days of the date of invoice, but in practice all too often that does not happen. The Governments’ Construction Strategy 2025 (BIS, 2013) reported its vision that ‘Construction in 2025 is no longer characterised, as it once was, by late delivery, cost overruns, commercial friction, late payment, accidents, unfavourable workplaces, a workforce unrepresentative of society or as an industry slow to embrace change’. Late payment has been the subject of lots of initiatives over many years; some are successful, but problems still remain. Figure 6.1 illustrates how money may typically come into, and go out of, a contractor’s account on traditional projects.
