asked the First Lord of the Admiralty what steps are taken to see that when interim payments are paid to contractors for works in process of completion, some proportion of the money is paid over to sub-contractors, who can thus be protected against too heavy financial Josses in the event of the bankruptcy of the major firms?
Under the terms of their works contracts the Admiralty are expressly relieved of any contractual or other liability to subcontractors. Steps are not, therefore, taken by the Admiralty in the circumstances described to see that some proportion of the payments to a main contractor is paid over to his sub-contractors.
In view of the fact that sub-contractors give considerable credit to major firms on the strength of the fact that they have Admiralty contracts, has not the Admiralty an obligation to see that the suggestion made in my Question is adopted, and is the hon. Member aware that local authorities frequently insert a clause to this effect in their contracts, and will he not give further consideration to the matter?
The system that we follow has been in operation for a great number of years and is working quite satisfactorily and a change would entail a large amount of disorder in the Department and I am very l0th to do it. Only one such case has been brought to my notice.