News analysis with BESA
The time for talking is over B
New BESA chief executive David Frise calls for urgent government action on late payment, including support for the Aldous Bill, rather than yet more consultations and voluntary measures
ESA has welcomed the promise from business secretary Greg Clark to make “urgent” changes to public sector procurement policies,
which came hot on the heels of a pledge to address the “scourge of late payment” made by Chancellor Philip Hammond in his Spring Statement. However, Mr Frise urged the government to pick up the pace of reform in light of the insolvency of part of the large building engineering company Vaughan Engineering – a direct consequence of January’s collapse of the construction firm Carillion. “Thousands of SMEs have been left in a perilous financial state as a result of Carillion and the government must respond,” he said. “Today there are 160 people facing redundancy directly as a result of Carillion failing to pay Vaughan Engineering for completed work. “The government must not stand idly by and watch more companies go under and more people lose their jobs.” MPs investigating the Carillion insolvency have expressed grave concerns about the Prompt
Payment Code (PPC) administered by the Department for Business, Energy and Industrial Strategy (BEIS). Carillion was a signatory to the code and received public sector contracts as a result, but forced its own supply chain contractors to accept 126-day payment terms.
Fundamental
Mr Clark told the Carillion committee that the code was “not adequate” and that discussions with small businesses had highlighted a number of ways in which “we can strengthen those requirements”. However, he said there was no “specific timetable”, despite acknowledging that it was “fundamental to the economy”. Mr Frise said it was “rubbing salt into the wounds” that Carillion’s administrator PwC had reportedly received more than £20m for its work during the first two months after Carillion collapsed. MPs accused PwC of “milking the Carillion cow dry”. BESA, along with the electrotechnical and
engineering services body ECA, met Mr Clark in the aftermath of the Carillion insolvency. They stressed to him the importance of supporting payment security measures such as placing retention money in ring- fenced deposit protection schemes; project bank accounts; and public contracts payment models. “The government already has many of the tools it needs to tackle this problem,” said Mr Frise. “The Aldous Bill, which seeks to bring about reform of the retentions system, is due to have its next reading in Parliament on April 27. Project bank accounts are being widely – but not universally – adopted; and the emergence of digital payment makes transparency in supply chain finance far easier to achieve. “I can’t see why this needs any further discussion.” Vaughan was owed more than £600,000 for
projects already completed on behalf of Carillion and was contracted to carry out a further £1.1 million worth of Carillion work in the first quarter of this year. The 50-year-old family run company had continued to pay its workforce despite no payment coming from
CLIENTS WARNED ABOUT REFRIGERANT UPHEAVAL T
he first BESA Forum for specifiers and end clients in England was held at BESA head office in London recently.
Representatives from public sector specifiers, including local authorities, the NHS, and the Ministry of Defence were joined by private sector clients such as Boots and Tata Steel to hear about and debate topical issues affecting their use and procurement of building engineering services.
The meeting followed the model set by BESA
Scotland and its highly successful Forum, which is now attended by 11 local councils and was originally developed in partnership with Fife Council. So far the Scottish group has debated how specifiers can manage the design and use of fire sprinklers; district heating; renewables; underfloor heating; air conditioning; and thorny topics like pre- qualification requirements for public sector projects. The first forum for England focussed on the F Gas
regulation and featured a presentation from Graeme Fox, Head of Refcom, on the refrigerant gas phase down process now taking place under the European F Gas Regulation. Delegates also heard from Paul Davies of Constructionline about procurement and supply chain management and witnessed a live demonstration of BESA’s maintenance tool SFG20.
Mr Fox explained that F Gas was having a
dramatic impact on the refrigeration and air conditioning market and had major consequences for end users. He pointed out that the cost of popular HFC gases was rising astronomically and compliance with the Regulation was a serious issue for anyone who owns cooling plant. Service costs will increase for many users, he
said. “In some systems, a leak means you have to replace the whole refrigerant charge – and the gas might be costing twice as much…or the contractor can’t even get hold of any because the wholesalers are not stocking it anymore,” said Mr Fox. The specifier guests also heard that the
Environment Agency now has the power to impose on the spot fines of up to £200,000 for F Gas breaches. In the past, they had found it difficult to prosecute offenders because of the complexity and cost of taking legal action – so this new power will make a huge difference. Many clients now only use members of the
Refcom Elite registration scheme, managed by BESA, because this substantially reduces the risks they face when undertaking this type of work. “For example, it is now mandatory to provide an audited trail of refrigerant use, but a lot of
companies are still not doing it,” said Mr Fox. “All Refcom Elite members do that as standard and several manufacturers now insist on Elite membership as part of their partnership programmes.” End users must provide log books and record
keeping for any system with a refrigerant gas charge of five tonnes CO2 equivalent or above. This must be made available to local authority inspectors, but does not need to be in paper form so Refcom has updated the software platform its members use. As a result, the end user is able to access all their equipment and refrigerant records via their Refcom contractor – from a central password-protected database in ‘the cloud’. As part of their strategies for managing this issue,
Mr Fox advised clients attending the BESA Forum to check their asset registers to establish what equipment and type of gas they were using. Recycled gas may still be used, but it must be recovered properly by an appropriately qualified contractor, he added. The BESA Forum is a great opportunity for clients and specifiers to get the latest information about a wide range of industry issues. For details of future forums please email:
kevin.kingaby@
theBESA.com
14 April 2018
www.heatingandventilating.net
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64
