Scottish construction companies are owed money to the tune of £120m following the completion of work, according to a new report by the Specialist Engineering Contractors (SEC) Group Scotland.

The bodies, such as councils and universities, are denying Scottish firms the money in order to improve their own cash position regarding working capital, the report has claimed.

The report also found that, while many bodies pay primary contractors within 30 days, secondary or sub-contractors do not always get the same treatment. It revealed that many organisations only begin the 30-day invoice payment notice following internal verification.

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The report also claims 72% of public bodies make no attempt to monitor supply chain payment – nor do 64% of universities.

Newell McGuiness, managing director of SELECT, a constituent member of the SEC Group, said: "This information makes very depressing reading. It suggests that while organisations which depend on money from the public purse would appear on the surface to be backing moves against late payment, the reality is somewhat different.

"The Scottish government has wholeheartedly endorsed industry’s appeals to help small firms by the simple expedient of prompt payment. It now needs to enforce that across the bodies for whose funding it is responsible."

(IT/MH)