Advance boss calls for emergency fund
A Scottish contractor employing more than 1,600 workers says the construction industry is facing “extreme pressure” because of the lack of detail on the coronavirus job retention scheme.
Seamus Shields, managing director at Lanarkshire business Advance Construction Scotland, said failure to publish a timescale for furlough payments had left many companies fearing for the future and he has called on UK and Scottish governments to consider an emergency funding package similar to that announced for the hospitality and tourism sectors.
Shields said: “Our company is working across more than 200 live construction sites and has a payroll stretching to seven figures per week. We also have 500 sub-contractors and over 2,000 companies on our supply chain who all depend on us. Nearly all work has ceased instantly.
“The job retention scheme was welcome news at first but the lack of detail is staggering. The claims system will apparently be open by the end of April but no one can tell us when payments will be made after a claim is entered.
“In the meantime, banks are providing little clarity to the sector on how we can maintain cash flow to ensure staff wages and contracts can be paid. People’s rents, mortgages, food and utility bills – all of these payments rely on the sector urgently being given the certainty it needs. We need that clarity now.”
He continued: “All of us recognise the demands on government but extreme pressure is being placed on the industry and my fear is that if some companies collapse then others in the chain will soon follow. Any decision we take to furlough staff has to be made with the knowledge of how claims will be handled by government and precisely when the payments will arrive.”
The situation had been made more complicated by the differing approach between the UK and Scottish Governments on continuation of construction, he said. “The Scottish Government has told the sector to cease activity in line with social distancing guidance. We are supportive of their direction as stopping the spread of Covid-19 and helping our brilliant NHS is the fundamental priority.
“South of the border, however, many construction sites are still operating. That is creating issues in the industry and raises questions about why some companies will need financial support and others will not.”
Shields said an emergency funding package should be made available to bridge the gap and allow companies to keep paying wages before any furlough payments are released. Such a move would encourage the industry to cease operations and ensure it was ready to quickly get going again when the situation changed.
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©Scottish Plant. Article posted 6/4/2020