Business, Innovation and Skills written question – answered on 26th November 2012.

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Photo of Gordon Banks Gordon Banks Labour, Ochil and South Perthshire

To ask the Secretary of State for Business, Innovation and Skills pursuant to the answer of 12 June 2012, Official Report, column 412W, on procurement, if he will extend the contractual requirement that payment reaches the third tier of the supply chain within 30 days on Government construction projects to cover tiers lower than the third; and if he will make a statement.

Photo of Michael Fallon Michael Fallon The Minister of State, Department for Business, Innovation and Skills

holding answer 22 November 2012

There are no plans to extend this contractual requirement at the moment; however, central Government have led the way in the use of Project Bank Accounts (PBAs). Using PBAs, payments due are made by the Government client to Tier 3 of the supply chain within five days. In instances where PBAs are not used, the requirement for contractors to pay their sub-contractors within 30 days—in line with the Government's Prompt Payment Code—is specified in contract terms.

Beyond Tier 3, Cabinet Office operates a Mystery Shopper Line, which allows all contractors to report issues concerning public procurement, including those associated with payment, enabling efforts to focus on areas where problems have been raised.

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