Most Roofers Report Trouble Being Paid Retentions on Council Projects

MOST ROOFING contractors – 86% – say they have trouble getting paid retentions owed on local authority projects. Just 14% say there are no problems.

The latest quarterly State of the Roofing Industry survey by Glenigan for the National Federation of Roofing Contractors (NFRC) asked roofing and cladding contractors about their experiences of cash retentions when undertaking local authority works.

More than half (51%) of respondents to the quarterly survey said they took on local authority work. Of these, 76% said that they always, usually, or sometimes had retentions held on them when undertaking those works.

Of that group, 86% said they always, usually, or sometimes had trouble obtaining the retention monies they were owed:

• 17% said they ‘always’ had trouble
• 33% said they ‘usually’ had trouble
• 36% said they ‘sometimes’ had trouble

The survey questions were out to the NFRC’s members following the trade association’s campaign against the practice of retentions in the construction industry.

Research revealed that £300m was being held in retentions in the roofing industry alone in 2021, according to the NFRC.

Withheld Retentions

This latest survey report suggests that the roofing sector continues to face major problems created by retention payments being withheld.

The results come as new rules on late payments were announced following the Autumn Statement. The government changed regulations so that businesses will have to publish data on all payments, late payments and payments in dispute from 2024. Businesses failing to pay within 55 days will be excluded from supplying for public contracts over £5m.

Over three-quarters of NFRC members (78%) say they have seen no improvement in retentions – or they are facing worse. Survey respondents said they are expeiencing the same level or more retentions than last year. Phrases used to describe their experiences of retentions included ‘unnecessary’, ‘tortuous’, as well as ‘psychologically damaging’.

James Talman, NFRC CEO

NFRC CEO James Talman said: “At best, retentions are an additional burden on time-poor microbusinesses. At worst, they reduce subcontractors to operating at a loss and sometimes even facing insolvency.

“Ending the use of cash retentions would encourage business investment in skills and expansion by improving construction SME cashflow, would free up hours of wasted time chasing owed monies, and could reduce the number of sub-contractor businesses that decide they just cannot carry on. This outdated practice has persisted for long enough: government, at both the national and local level, should set an example to all UK clients to end its use throughout their project supply chain.”

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