UK housebuilder joined by Laing O’Rourke, Engie and Costain in being named and shamed by government
Persimmon has been suspended from the Prompt Payment Code, the voluntary agreement which sees signatories promise to pay their suppliers on time.
The housebuilder, which recently announced it would be introducing a “snag” retention scheme for home buyers, was among a number of high-profile construction firms to have been suspended from the code, established by the government to stop large firms taking advantage of suppliers by delaying payment.
The government expects its own suppliers to sign the voluntary agreement, under which firms pledge to pay 95% of all supplier invoices within 60 days. In the case of contractors ministers have warned those companies which fail to settle their debts on time they risk missing out on public sector work.
Persimmon was among 17 suspended firms, including contractors Balfour Beatty, Laing O’Rourke and Costain, as well as Engie.
Firms suspended from the code, which is overseen by the Chartered Institute of Credit Management on behalf of the government, have up to 12 months to “demonstrate compliance” or face permanent expulsion.
A spokesperson for Persimmon said the housebuilder was “fully supportive” of the code’s aims.
“We are working towards achieving its 95% target. We know we have more work to do and have an action plan in place.
“We are investing in new initiatives to increase efficiency and speed up payment, and we are also streamlining internal processes and systems to support further progress.”
The spokesperson said the housebuilder was in talks with the code’s compliance board regarding its action plan. “We are confident that implementation of these measures over the next few months will enable us to meet the PPC’s target over the first half of next year.”
The Chartered Institute of Credit Management is currently carrying a second phase of investigation which could see more firms removed.
Kelly Tolhurst, minister for small business, said the code was “a positive force for good and by naming transgressors we are supporting small businesses in the supply chain”.
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