Letter to First Minister
Sturgeon urged to re-think halt on construction sites
Dormant: Scotland’s building sites are inactive
Builders and plant hirers in Scotland are demanding an easing of the lockdown in Scotland, warning that companies are running out of cash.
Federation of Master Builders Scotland director Gordon Nelson said that financial problems were mounting amid concern that Scotland was not following England in allowing some sites to resume work.
Bellway today joined other housebuilders Taylor Wimpey and Persimmon in announcing plans to be back on site next month.
Mr Nelson said: “There’s evidence that about two-thirds of small and medium-sized construction firms may only have the cash to survive another two to three months if the present circumstances continue.”
Paul McCormack, managing director of Blackwood Plant Hire and representing the Scottish Plant Owners Association, has written to the First Minister Nicola Sturgeon.
He has called for Scotland to be brought into line with the rest of the UK in allowing construction sites to operate.
“We feel that the different message from the Scottish Government regarding the construction industry compared to the rest of the UK is causing frustration throughout Scotland.
The SPOA Executive Committee do not understand why Scotland can be different from the rest of the UK– Paul McCormack, SPOA
“Taylor Wimpey and Persimmon Homes announced that they will be re-starting construction sites next week but not in Scotland until they have guidance from the Scottish Government.
“The SPOA Executive Committee do not understand why Scotland can be different from the rest of the UK.”
He adds that Scotland-based employees are working on sites in England and following the Construction Leadership Councils advice on safe working, but the same employee cannot work on a site in Scotland.
“The majority of our industry is highly geared with high HP/Lease payments that of course can be stopped by those finance companies who allow a payment holiday but that is only a deferral.
“When we restart our businesses we will require cash to pay the increased wages bills and supplier payments whilst we have to wait on our customers paying ourselves who will be in the same position after a six-week shutdown.
“In essence, the longer our industry is closed the fewer businesses will be able to survive. Insolvencies will cause more cost to the Government in statutory redundancy payments paid by the National Insurance Fund.”
Forum appeals to Holyrood
The paper, which outlines a series of urgently-needed actions to improve liquidity in the industry, will go to both public and private sector clients, while the Scottish Government will be kept informed and its support sought.
It is the most recent initiative by the Forum, which is made up of 17 trade and professional bodies as well as companies and government agencies, and it reinforces calls to the industry to ensure that payments are made on time to safeguard the sector’s future.
Fiona Hodgson, chief executive of forum member SNIPEF, the plumbing and heating employers association, said: “The construction sector as a whole is currently facing extraordinary difficulties, which will only be exacerbated if companies and public bodies take unnecessary time to pay their suppliers.
“This paper outlines a multi-pronged strategy to improve cashflow and introduce some creative thinking on addressing what lies ahead.”
Ms Hodgson pointed out that the importance of the construction industry to Scotland was illustrated by the fact that it employs more than 175,000 people, or around 10% of the total workforce.