Question reference: S5W-22462
- Asked by: Kezia Dugdale, MSP for Lothian, Scottish Labour
- Date lodged: 2 April 2019
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Current status: Answered by Derek Mackay on 24 April 2019
Question
To ask the Scottish Government how it ensures that firms that it has awarded contracts to pay their sub-contractors on time, and what action it takes if they fail to do so.
Answer
The Scottish Government is committed to paying our contractors promptly and ensuring that they do the same with their subcontractors.
We include a standard clause in our contracts requiring prompt payment of valid invoices within 30 days down the supply chain and have urged other public bodies to do the same. Also any subcontractor in our contracts who believes that they are not being paid on time can raise the issue directly with us for resolution.
We announced on 19 February 2019 that we had delivered on our Economic Action Plan pledge to increase the number of Scottish Government construction contracts to which Project Bank Accounts (PBAs) can be applied. PBAs ensure that payments to supply chain firms are made promptly and protected from upstream insolvency. PBAs are now available to more small businesses after we brought more Scottish Government construction contracts into scope - infrastructure projects over
£5 million, replacing the previous £10 million threshold; and building projects over
£2 million, instead of £4 million. This is to make prompt and protected payment a reality for many more small businesses in our construction industry.