| FPB attacks Rok over payment changes |
| Friday, 03 July 2009 | |
|
The Forum of Private Buisiness (FPB) has launched a stinging attack on construction group Rok over its decision to extend payment times to its suppliers.
The company says the FPB’s is being entered into its "Hall of Shame" after extending its standard payment terms from 30 to 60 days for new contracts with sub-contractors and consultants. The FPB says it has written to the company inviting it to sign up to the Government’s new Prompt Payment Code. “Small businesses are bearing the brunt of the slump in the construction sector. It is not reasonable for big businesses to pass on costs incurred via changes to payment terms and conditions further down the supply chain,” said Nick Palin, the FPB’s Director of Finance and Administration. “In the current economic climate, this behaviour can force small firms to cease trading altogether. The FPB is campaigning to change the culture of poor payment in the UK and is urging to Rok plc to sign up to the Prompt Payment Code.” The 60-day standard payment will apply to all future agreements “which if not refuted in writing within seven days of its receipt will be deemed effected,” according to a letter, seen by the FPB, which was sent by a subsidiary of Rok plc to sub-contractors and consultants on 22 June 2009. A spokesperson for Rok plc, who confirmed that the company had changed its standard terms to 60 days for all new agreements, alongside other companies in the construction sector, told the FPB that the letter was sent out in error, was not of the ‘usual Rok language’ and did not reflect the ‘true situation’. One FPB member, who wished to remain anonymous, said: “The company has said that these new terms and conditions will apply unless there are objections to them, but, in reality, how can you stand up to a business of Rok’s size?" |
