More than £350m of cash owed to Carillion subcontractors via its controversial Early Payment Facility (EPF) will never reach them.
Carillion launched the EPF back in 2012 claiming it would “bebefit all participating suppliers and have no detrimental effects on any suppliers.”
Suppliers could get paid earlier than the firm’s 120-day terms in return for a fee.
The EPF was run in conjunction with banks including RBS, Lloyds and Santander who paid invoices once they were approved by Carillion.
But the system stopped working once Carillion became insolvent even though the banks continue trading as normal.
Subcontractors said Carillion had been delaying signing-off payments and questioning invoices in the run up to its demise.
One told the Enquirer: “We were owed more than £50,000 through the EPF but have been told it was shut down from Monday and there will be no more payments.
“Carillion’s accounts department have been a nightmare to deal with for months offering lower payments verging on the ridiculous. It has become clear why now.”
Another added: “Yet again the suppliers are shafted.
“This early payment system was controversial from the start but at least for a fee you got your money.
“Now Carillion has gone but the partner banks they ran it with are still in business yet all those millions in the system logjam have magically disappeared.”
from Construction Enquirer http://www.constructionenquirer.com/2018/01/17/subcontractors-left-stranded-by-carillion-early-payment-system/
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