Fair payment in public sector gets off to a flying start

Leading bodies in the construction industry have endorsed the Office of Government Commerce’s Fair Payment Charter, which commits public-sector clients and their principal contractors and supply-chain members to formally adopt fair-payment principles in future construction projects. The charter was signed at OGC’s offices at a function attended by representatives from the Construction Industry Council, Construction Clients Group, Construction Confederation, National Specialist Contractors Council, Local Government Task Force, Construction Products Association, Specialist Engineering Contractors Group and the National Specialist Contractors Council. Stephen Timms, Minister for Competitiveness, said, ‘Over a third of the output of the construction industry is for the public sector. This means that on many issues, Government and the public sector can make a difference through its procurement function. I am delighted that the industry and Government have been able to come together to agree what principles of fair payment should apply on Government construction projects.’ The charter is part of the Government’s fair-payment initiative, which has achieved cross-industry agreement on the principles of fair-payment best practice in public-sector construction projects throughout the construction supply chain. It is estimated that widespread adoption of these principles could save the public sector up to £750 million a year by significantly reducing financing and risk elements from project costs. OGC, working with industry bodies, will monitor the progress of implementing fair-payment practice and the adoption of the charter for two years from January 2008.