There’s something ominous about this month’s news (on p5) that the government is consulting the industry on the subject of retentions.
That’s not a criticism – the government’s doing the right thing. But the problem of retentions abuse invariably raises its ugly head when the economy starts to slide.
During the boom years of the early ‘noughties’ all you heard was bold talk of ‘supply-chain integration’, ‘partnering’ and ‘open-book accounting’. Then came the 2008 crash and suddenly main contractors were forcing subbies to discount contracts that had already been awarded.
It’s happening again. On p39 of this issue we hear a call to arms on behalf of subcontractors, of whom more than half have been embroiled in disputes with an employer. In over 80% of cases, it’s about payment.
We learned last month that several of our biggest contractors are now deeply in the red. And so – just as before – they start pillaging the supply chain.