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Retentions can cause 'immense damage' to SMEs

Support is growing for our Time for Change campaign, with members of our LinkedIn group expressing their reasons for signing our e-petition.

One LinkedIn member said there was no reason why retention funds within contracts should not be placed in trust funds. He said retentions are too often treated as discounts and can cause immense damage to small and medium-sized enterprises.

Another commented: “Dealing with the procedures in the construction chain from the outset is difficult enough if you are a smaller contractor without lots of time or resources, and added to this is the ultra-competitive nature of the market and a certain amount of brow-beating from higher up the chain. Many of the firms at the bottom of the chain are working on minimal margins, so retentions can sometimes be the difference between making a loss or profit if the job doesn’t go to plan, if you get them at all.

“This affects nearly everyone in the sector, so everyone needs to sign [the petition] – from apprentice to managing director.”

One member said he had spent 20 years extracting monies when dealing with main contractors. He added that he had spent over £50,000 in legal fees and had sometimes failed to recover all the debt.

The Industrial and Commercial Energy Association (ICOM) has also come out in support of campaign.

SEC Group chief executive Professor Rudi Klein said: “Once the Small Business Bill is in the House of Lords, we will try to amend it again to increase pressure on government to address the lack of security for retentions. [We] intend to keep up the pressure in line with the H&V News Time for Change campaign.”

Duct-Tech Solutions (UK) finance director Anthony Rex commented: “I will be promoting the e-petition to the other linked-in groups that I am a member of including the Yorkshire Mafia, HVAC Professionals and others. I will be watching the e-petition count with interest and will be bringing the issue to the attention of my local MP, Ed Balls,  at a forthcoming meeting.”


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