Two of the UK’s largest transport infrastructure clients have pledged to speed up payments to suppliers as part of efforts to help keep the industry afloat through the Coronavirus crisis.

Highways England and Network Rail have both moved to reassure the sector and boost cash flow through their supply chains. This comes after Government issued a procurement policy note highlighting that many construction firms may be at risk of insolvency due to Coronavirus.

It called on contracting authorities to continue paying suppliers even if service delivery is disrupted or suspended, and said appropriate measures should be put in place to support cash flow.

Network Rail has now committed to pay its contractors ‘immediately, or as close to immediately as possible’. This means payment could be up to seven days faster for small and medium sized enterprises and up to 28 days quicker for other suppliers, it said.

“Our priority is to support the supply chain as much as possible through these unprecedented times,” said Network Rail’s commercial and procurement director Clive Berrington.

“We have therefore moved all our suppliers to immediate payment terms, or as close as you can get following approval of the invoice, and we expect that to flow down to the supply chain.” 

He said the measures would help to “ensure we have a strong supply chain when we emerge from this pandemic”.

Meanwhile, Highways England’s executive director for commercial and procurement Malcolm Dare wrote in an update to contractors and suppliers that the organisation is aiming to speed up payments.

“We are continuing to accelerate supplier payments for work completed and correctly invoiced,” he said.

“We currently pay 74% of invoices within five working days from the receipt of the invoice for all suppliers and we are looking to improve this further, especially for SMEs.”

He added that the strategic road network operator is exploring opportunities to accelerate operations and major project work “to support the supply base” and stressed that all planned and on going procurement activities are continuing.

 (Photograph: Network Rail)