SMEs must speak with one voice to combat cuts in payments by housebuilders

Taylor Wimpey, David Wilson Homes and Barratt’s decision to cut payments to their subcontractors and suppliers by as much as 5% is nothing short of scandalous.

The cut in payments has been introduced by the major contractors because of claims about the economic downturn for the house building industry.

However, their decision clearly fails to recognize that SMEs have businesses to run as well and suggests that SMEs are being asked to pay for mistakes made by the major contractors.

What is particularly disappointing is the fact that these cuts make a nonsense of all the talk about partnering and the respect for people agenda. It just shows that when push comes to shove it is the small firms who get shafted.

While it is totally unacceptable for major contractors to treat subcontractors and suppliers with this amount of contempt it also questionable whether such action is in fact legal under the Construction Act, and the FMB will be looking at the legality of such decisions.

What is needed now is for sub-contractors and suppliers to rally together and champion a united response so that we speak with one voice. Let the battle commence!