Late payments consultation: tackling poor payment practices

Steve and Rob discuss the Electrical Contractors’ Association (ECA) response to the consultation. ECA’s Steve Bratt, CEO; and Rob Driscoll, Director of Legal and Business, are featured in a video calling for ECA Members to get involved in this “once in a generation chance” to get the industry to step up and support changes to retentions and late payment.

ECA has fought for retention reforms for more than 30 years. The Late Payment Consultation is the most pivotal Government intervention since the Construction Act in 1996. It is vital that industry coalesces around one solution: abolition or protection of cash retentions . By submitting a response, using this template, professionals can help influence the outcome. See also article retention reforms are within reach.

Based on Member insights from the Business Policy & Practice Committee, the Government is considering several of ECA’s lobbying positions, who made a substantial contribution to the Call for Evidence on the Small Business Strategy, which led to the Small Business Plan. The consultation which closes on 23 October 2025 is described as thus:

"Late payments can disrupt cash flows, prevent businesses from paying their bills, and even lead to business closures. Small and medium-sized enterprises (SMEs) are especially exposed to these issues, as they often have less cash in reserve to act as a buffer.

The Department for Business and Trade (DBT) is publishing this consultation which seeks views on a package of legislative measures aimed at addressing late payments, and ensuring businesses are paid fairly and on time.

Late payment is characterised by 4 different but inter-related problems, and the proposed measures aim to address them all. The problems the measures aim to address are:

• late payments. Where businesses fail to pay an invoice within agreed payment terms (30 days where no specific terms have been agreed).
• long payment terms. Where payment terms are agreed over extended periods, beyond 60 days.
• disputed payments. Where businesses disagree over the goods or services supplied and payment is delayed or reduced.
• unfair practice around retention payments. Specific to the construction sector, where retained money can be lost through upstream insolvency or subject to late, partial or non-payment.

The Department for Business and Trade (DBT) has also prepared an accompanying Options Assessment, which assesses the impact of the proposed measures.

(The government) welcome views from businesses, trade representatives, and other organisations or individuals who are interested parties to the proposals."

A template response is available to ECA Members, to submit to the Government’s consultation. The consultation can be completed online, or by email at: [email protected]. The deadline for submissions is 23 October 2025.

This article appears on the ECA news and blog site as "ECA urges Members to respond to Government’s retentions and late payment consultation" dated 1 September, 2025.

--ECA

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