Select Committee backs retentions reform

The BEIS Committee report into Small Businesses and Productivity, published this week, calls on Government to introduce statutory requirements to pay within 30 days and recommends that cash retentions be held in independent accounts. It also calls for the Small Business Commissioner’s remit to cover construction and give him the power to fine late payers. The report echoes recent announcements by Cabinet Office Minister Oliver Dowden MP that main contractors be excluded from public sector contracts if they fail to pay supply chains on time. Dowden and the BEIS Committee report have been praised by the ECA and BESA. Many of the outcomes of the report reflect evidence given by BESA and ECA members directly to the Select Committee and in written submissions. As political support continues to grow, pressure is mounting on government and industry to come together and find a solution to the issue of retentions. Alexi Ozioro, BESA Public Affairs and Policy Manager, said, “With the anniversary of Carillion only one month away, this is a very welcome report. To have the BEIS Committee back retentions reform is a huge step for fair payments. The report goes further than previous ones, because it actually calls on Government to act with sound recommendations.” “The Aldous Bill now has 270 MPs supporting it, there is industry consensus on the need for reform and now Select Committees are calling on government for independently held retentions. It looks like change is finally coming to the industry.” ECA Deputy director of business, and SME business adviser to the cabinet office, Rob Driscoll, added: “This is a significant milestone. Government is now setting the tone for acceptable supply chain payment behaviour and realising its role as a leading and responsible client in the post-Carillion era.” “The Select Committee heard compelling evidence from ECA and BESA members on widespread issues surrounding payment, and this report shows industry the way on both payment and retentions. We now need action to implement its recommendations, which will help smaller businesses to realise their full potential.” The BEIS Select Committee report states: “We are shocked by the extent of late payments and the impact they are having on small businesses. This includes the personal cost to owners and workers but also the local communities they serve and the wider UK economy. It is completely unacceptable.”

London calling for illuminated bridges

Signify, formerly Philips Lighting, has been announced as the connected lighting partner to illuminate up to 15 of London’s iconic bridges by 2022. The contract was awarded by the Illuminated River Foundation to reinvigorate the city’s famous River Thames bridges and further differentiate London as one of the world’s most attractive, leading capital cities. Signify won the contract to supply its Interact Landmark system and Philips Colour Kinetics LED luminaires to light up the bridges with dynamic, artistic lighting effects via its centrally managed software. In addition, Signify will provide lifecycle services to remotely monitor and manage the connected bridge lighting for the next 10 years. This is the first time there has been a holistic strategy to light up all of central London’s bridges. The aim is to create a multi-level visual experience for the bridges viewed by pedestrians on the bridges, from London’s riverbanks, from the air, from tall buildings and by boat. The project is led by the Illuminated River Foundation, which ran an international design competition for the lighting design which was won by international artist, Leo Villareal and London architects, Lifschutz Davidson Sandilands. Following a rigorous evaluation, Signify was awarded the project because of its global breadth and expertise in lighting and ability to deliver such an important, large-scale, connected lighting project. Also, a key factor was Signify’s experience of working with lighting designers and architects on the management of dynamic, architectural lighting scenes. “London’s bridges are world-famous but had become overlooked in terms of their potential to transform our capital city at night,” commented Sarah Gaventa, director, Illuminated River Foundation. “What we are doing now, in partnership with Signify, to transform the bridges and riverfront, is groundbreaking. We are using dynamic, energy-efficient LED lighting for the first time on up to 15 London Bridges with Signify’s Interact Landmark system to create public art on the largest scale ever seen.” Maria-Letizia Mariani, president of Europe, EVP, Signify, adds, “Light is one of the most powerful means of breathing new life into leading cities and metropolitan areas, heralding a new era of urban design and beautification. We’ve lit bridges around the world and seen first-hand the positive impact that dynamic architectural lighting has on transforming local communities and economies. It’s wonderful to give the people of London stunningly-lit bridges with some lit up for the first time.” Phase one commencing now will see four bridges illuminated by mid-2019 with connected Philips Color Kinetics LED luminaires, featured on London Bridge, Cannon Street Railway Bridge, Southwark Bridge and Millennium Bridge. Signify’s Interact Landmark system will remotely monitor and manage the lighting on all four bridges.

Brexit agreement welcomed by SELECT

SELECT, the campaigning trade body for the electrotechnical industry in Scotland, has welcomed the approval of a plan which secures full post-Brexit membership of the British Standards Institution (BSI) within European Standards Organisations (ESOs). The decision, taken separately by ESOs CEN and CENELEC, means the BSI, UK industry and other stakeholders will continue to have a central role in shaping and maintaining best practice standards across Europe. It also means that UK professionals will continue in leadership roles in committees and as policy experts engaged in maintaining and developing the 20,000 European standards that are managed by CEN and CENELEC. Dave Forrester (pictured), head of technical services at SELECT, said, “This is the best possible outcome of what has been an uncertain situation. BSI Group has argued that its membership and influence in ESOs should not be affected by the UK leaving the EU and that is what it has achieved. “The approval displays a welcome pragmatism on both sides, which will provide stability for the European standards system and reassure standards users in the UK that the system will continue to meet their needs.” The BSI position on post-withdrawal arrangements was supported by the UK government and confirmed by Business Secretary Greg Clark in the White Paper, the Withdrawal Act and ‘no deal’ technical notices. The UK, through BSI, will continue to commit to the fundamental membership principles of CEN and CENELEC, meaning that all member countries of CEN and CENELEC have a consistent and coherent catalogue of national standards for industry, consumers and regulators.

Feature - Where's My Money, Man?

Lee Murphy of Pandle, a cloud bookkeeping software for small businesses, looks at how to tackle the late payment culture. It can be a daunting time; having completed a job to a high standard, paying meticulous attention to customer care, you are left waiting weeks or even months to get paid. The number of smaller construction sector firms at risk of collapse because of late payments is on the rise. According to recent research by the Prompt Payment Directory, many business owners cannot afford to pay themselves a salary because of the financial strain caused by late payments. It is a national problem highlighted by the collapse of construction giant Carillion earlier this year. The company was revealed to have spent £952m on local suppliers in 2016, relying on an extensive network of small firms who were forced to accept payment terms of 120-days. In the wake of its failure, Carillion is believed to have left up to 30,000 small businesses with unpaid bills, having a knock-on effect on their ability to continue trading. Those businesses have been jeopardised simply because they had not been paid by a client many had presumed reliable and solvent. Dire straights The Prompt Payment Directory gives some insight into the effect Carillion’s collapse has had on the construction sector. Of the 400 small construction firms surveyed, 74% reported to have been on the brink of bankruptcy or liquidation or said they could be soon due to late payments. That figure is up by 30% on the previous year. Dealing with late payers may seem a challenge, particularly if you are a one-man-band working for a corporate client, but it needn’t be so. By taking steps to ensure your customers know when and where to pay you, you can instantly reduce how long it takes for invoices to be settled – after all, not all late payments are made with cynical intentions. All too often it is easy to focus on doing the day job and keep work coming in and leave the business of chasing down invoices to another day. Yet business administration, from sending out bills to forecasting cashflow, is as much a key component of a healthy thriving business as having a strong workflow. There are plenty of tools available online, many of them free of charge, that will help you get organised and keep track of who owes you what and when. Many of them are event free, such as Pandle, which can automate the process of chasing and reminding customers for you, something that we see invariably having an immediate impact getting debtors to pay more quickly. Payments policy Creating a payments policy that can be agreed up front with clients will help head off many problems before they arise. If you have a late payments policy in place, then you have the authority to enforce the rules. Asking clients to sign a payment policy at the start of a contract will ensure that they are aware of your terms and conditions. Include specific payments dates – these may vary depending on what business you are in – as well as details of charges and interest for late payments. Make sure your invoice includes all the correct information – help your clients to pay you by telling them how and where you want to be paid. Phased payments If you are taking on a large job that could span months or ones that involves you incurring costs up front, make sure you ask for a deposit or phased payments – no matter how reliable this customer has been in the past. It’s well worth considering a deposit to make sure a project goes through ensuring you at least get some money if the work falls through. Likewise, phased payments for longer-term projects will ensure a healthy balance sheet. Bonuses and penalties You may wish to include details of penalties for late payers in your payments policy. This could be a financial fine, or you may want to refuse any repeat business until a payment is made. You can encourage early payments by including bonuses, such as a discount or a free follow-up visit for customers who settle early. Not only does this boost your business coffers but builds customer loyalty. Reminders and non-payers There is nothing worse than calling a client to demand payment only to find you have the wrong details or perhaps missed out their purchase order number and they are using this as a tactic to keep delaying its payment. Be clear of your facts before you begin sending reminders and demanding payment. Remember to stay professional and courteous; being abrasive and rude will not encourage a client to pay up. If a client continues to refuse to pay after reminders are sent, you may want to refuse any new work until bills have been settled. Remember to keep a note of non-payers, this could help you in several years to come.  Dealing with non-payers If you hate chasing invoices, consider selling your invoices and getting someone else to do the chasing for you. This is called ‘factoring’ – it comes at a high cost, but it does mean you get paid on time and don’t get involved with chasing lots of invoices. Any decent tradesman wants to keep a good relationship with their customers, but chances are you will have to get tough with non-payers at some point. If you have people who won’t pay, then lots of phone calls and emails are the starting point and, clearly turning up at their house for domestic clients works well. After that it is legal channels, which sadly can be slow moving and involve more cost. If you are clear with customers about your payments policy and set up an automated reminder system that prompts them of when and where to pay, you will immediately cut how long it takes for invoices to be settled. In doing so, you will be left to focus on building your business, something that is good for you and your customers. Pandle, pandle.com - This article originally appeared in the October 2018 issue of ECN.

Buzz Electrical Wins Apprenticeship Awards

Buzz Electrical Ltd has won 'Small Apprenticeship Employer of the Year' and 'Apprenticeship Employer of the Year' for 2018 at this year’s Worcestershire Apprenticeships Awards. The awards, organised by Herefordshire & Worcestershire Chamber of Commerce, were held in November at Tree Tops Pavilion, Midlands Safari Park. Hosted by Angellica Bell the event was attended by 350 guests, including 25 of the county’s best apprentices, employers, training providers and schools. Based in the Vale of Evesham, Buzz Electrical has been providing electrical services and installations throughout the Midlands, Cotswolds and further afield for residential, commercial and industrial clients for 19 years. Managing director and founder of Buzz Electrical Ltd, Steve Owens said, “It was such an achievement for us to win these awards, to be recognised by our business counterparts for all the work we have put into our 18 apprentices over the past 19 years. Without our apprenticeship programme, Buzz wouldn’t be what it is today. “I started as an apprentice, at the age of 16, and I am now in a position to give the same chance as I had to as many young people as possible. The construction industry is in need of more young people to come into the industry, across all areas, hopefully this will help to raise the profile of apprenticeships within the construction industry and to show, how with hard work you can progress. I would like to thank Worcestershire Apprenticeships for the recognition they have given to us and all the other award winners.” “I am incredibly proud of all the team of 26 at Buzz for their continued hard work, dedication and enthusiasm, and these awards are fantastic recognition for all that we’ve achieved together.”

J S Wright Sponsors Local Amateur Rugby Team

Building services provider J S Wright has boosted its support for a local rugby team after signing a sponsorship deal with Stourbridge Lions. The mechanical and electrical building services specialist will sponsor the team shirts of the amateur side until the end of the 2020/21 season. Formed in 2002, Stourbridge Lions are in their second season in the Midlands 1 West (Level 6) league, after being promoted as Midlands 2 West (North) League Champions in 2017. J S Wright has been supporting Stourbridge Rugby Football Club as a regular match sponsor and pitch-side advertiser at its Stourton Park ground in Stourbridge, Worcestershire for more than ten years. Simon Lawlor, Stourbridge Lions team manager, said, “We are thrilled that J S Wright has increased its support to Stourbridge rugby club by becoming a highly valued sponsor of our Lions team.” Marcus Aniol, managing director of J S Wright and a former Stourbridge First XV player, added, “We are proud to get behind Stourbridge Lions, literally, by having our logo on the backs of their new match shirts. “As young people are the bedrock of our company, we are more than happy to support an activity that excites them and encourages healthy competition.”

powerBall 2018 Raises Over £160k

The Electrical Industries Trading Company, in support of the Electrical Industries Charity (EIC), has announced that powerBall 2018 raised over £160,000, with dozens of companies and individuals donating £1,000 each in support of those who are suffering with mental health issues. Over 700 industry professionals got together to celebrate a successful year in the electrical sector at powerBall 2018 which took place at Grosvenor House on Park Lane on 9 November. powerBall 2018 highlighted the ongoing crisis in the industry surrounding mental health, which resulted in 36 deaths by suicide within the electrical sector in the last year alone. During the night EIC filled the stage with 36 lights – one for each person who lost their life to suicide – and encouraged the industry to show support by donating £1,000 for each lost life. Dozens of companies and individuals demonstrated their support for the industry which will allow EIC to assist hundreds of those who are struggling with mental health issues every single day. Managing director, Tessa Ogle said, “Every year powerBall brings the industry together under one roof to mark another successful year in our sector and this year’s event more than lived up to expectations. “We would like to say a big thank you to our headline sponsor City Electrical Factors (CEF), all other powerBall sponsors and every one of you who showed support on the night. Without your kind support, we would not be able to assist hundreds of our industry colleagues in their hour of need and tackle the crisis surrounding mental health. See you all at next year’s centenary celebrations.” Next year powerBall will be celebrating its 100th anniversary and will be held on November 8 2019 at London Hilton on Park Lane.

Rexel Supports Young People Through Everton Football Club's Official Charity

Youngsters in Liverpool were given a taste of the marketing world when they were visited for an interactive session by Rexel, a leading electrical distributor. The sessions took place earlier this year when Rexel partnered with Everton Football Club's official charity on its Home is Where the Heart is and All About Enterprise schemes. The programmes were ongoing throughout the year and have had a great response from children and young people around Liverpool. The All About Enterprise scheme is a pilot which the Premier League team set up to support local primary school children by introducing them to new skills, and opportunities in future life. The programme discuss topics that are not on the national curriculum such as Techonology, Customer Service, Budgeting and Finance, Advertising and Marketing and Manufacturing. The aim of the Everton in the Community programme is to engage and empower pupils whose strengths may not lie in the standard curriculum and provide a change for them to experience new things and open up employment opportunities in the future. Rexel’s Kate Adamczyk, head of branch marketing, and David McBride, C&I national account manager, delivered interactive sessions to the pupils at St. Aloysius Catholic School, Broadgreen Primary School and Longmoor Community Primary School in the Liverpool area. The lessons touched on what marketing is and how it is used by brands, including some of their favourite toy stores. The presentation was well received by teachers and students alike, with the students showing interest and flair for the subjects discussed. Rexel also supported the Home is Where the Heart is scheme through a charitable donation to help see the opening of a house to provide a shelter and support for vulnerable young adults. The football club will be able to offer six youths a home and continued support with opportunities relating to employment, education and training.

SELECT's Alan Wilson Appointed Vice-Chair Scottish Building Contract Committee

The Scottish Building Contract Committee (SBCC) has elected Alan Wilson, acting managing director of SELECT to be its vice chair. The election took place at SBCC’s AGM on November 7. The SBCC, whose role is to provide definitive guidance on building contracts and construction law in Scotland, was founded in the 1960s. Until now, its office bearers have been drawn from the membership of the Royal Institute of Architects in Scotland (RIAS) and the Royal Institution of Chartered Surveyors (RICS). Alan Wilson said, “It’s a great honour to our organisation, as well as to our sister body, the Scottish Engineering Contractors Group, (SECG), to have been elected as vice chair of SBCC.” Chair of the SBCC, Lisa Cattanach, a chartered surveyor who is also a director of Glasgow-based Contract Dispute Resolution, added, “We have worked closely for some years with SELECT and SECG and have a high regard for their professionalism and abilities. “In our view, the election of Alan to be our new vice chair is a timely and appropriate development reflecting our due acknowledgement of his organisation”. Lisa’s first official role as chair of the SBCC was to host an annual conference which was held in the Merchants House in Glasgow on Wednesday November 14. She said, “We had an outstanding line up of speakers including Professor John Cole of Queen’s University, Belfast, who delivered a very thought provoking State of the Nation address, in which he focused on the findings of two independent enquiries of industry-wide significance established to address major issues of building quality."

Engineering Services Optimistic Despite Persistent Payment Issues, Says Survey

The latest quarterly sector-wide ECA, BESA, SELECT and SNIPEF Building Engineering Business Survey, sponsored by Scolmore, has revealed that up to eight out of 10 engineering services organisations say they typically receive payment more than 30 days after the due date. This comes despite over half (56%) of buyers inserting under-30-day payment clauses in their contracts. Despite this, over three in four engineering services organisations (77%) say turnover increased or remained steady in Q3 2018, with nearly eight out of ten (78%) predicting their turnover will grow or remain steady for the current quarter (Q4 2018). Buyers in the commercial sector were identified as the worst payers, with over eight in ten (83%) saying they received payment more than 30 days after commercial work. For public sector work, on average, 71% of respondents were paid after 30 days. Overall, almost a fifth (19%) were paid after 60 days. Retentions were held against nearly two thirds (58%) of survey respondents. More than half (52%) said that between 1 and 10 per cent of their organisation’s turnover was tied up in retentions. ECA deputy director of business policy and practice Rob Driscoll said, “These figures show that overturning the late payment issue remains the key to unlocking productivity, growth and prosperity, particularly with the uncertainty of the next two quarters. “ECA will continue to work diligently with Government, the Small Business Commissioner and others to gain further support for initiatives such as the Aldous Bill and help the industry to resolve its long-running, and continually damaging, payment problems.” BESA public affairs & policy manager Alexi Ozioro said, “It is great to see more growth in the sector and industry, but it is frustrating to know that the growth figures would be even bigger if late payment was not impacting so many businesses. “The Government’s recent commitment to legislation on the issue of retentions is very encouraging, and we can only hope that the wider fair payments landscape moves along too.” SELECT acting managing director, Alan Wilson added, “It’s clear that despite well-intentioned statements from a number of bodies and governments, nothing has altered in the payment regime in our sector. It’s a matter of urgency that this issue, which is the number one priority for many businesses, is tackled quickly and effectively. “The time for talking is over; we must see some real action to help alleviate the issues our members face.” SNIPEF chief executive Fiona Hodgson concluded, “These results highlight the urgent need for action to address the culture of late payments within the industry. While there is optimism with predictions of steady or increased turnover, issues with payments and retentions remain a major cause of concern with our members that urgently needs to be addressed. Change is needed now to provide certainty to businesses.” The survey received 387 responses from companies across the multi-billion-pound industry, mainly regarding their performance in Q3 (July 1 to September 30, 2018), and expectations for Q4.