The two engineering services trade bodies have issued a five-point plan to the Treasury, calling for the following to be prioritised in the Budget to boost productivity, jobs and growth:

• Prompt payment - Make prompt supply chain payment a formal part of the government’s selection process for larger suppliers, and have specific rules to exclude them from the public sector procurement process if a bidder fails to assure it will pay all suppliers within 30 days.
• Retentions – Take decisive action to reform and overhaul the existing cash retentions system, which currently results in SMEs having their day-to-day cashflow restricted, as well as losing what they are owed if the company holding the retentions goes insolvent.
• Low carbon investment – Offer businesses incentives to invest in ‘low-to-no’ carbon energy projects by improving tax and regulatory policies aimed at engineering businesses, particularly SMEs.
• Off-payroll working – The Government must significantly simplify the employment status test before imposing new compliance processes on SMEs in the private sector. Without simplification, small and medium-sized businesses could face costly new administrative burdens.
• Supporting engineering skills - Government must actively recognise the vital importance of engineering to the economy, and consequently invest in technical skills. More money is needed for investment in technical retraining, and R&D. Non-levy funding for apprenticeships should also be maintained.

ECA chief executive Steve Bratt commented: “ECA and BESA are calling on the government to actively support engineering SMEs – the engine of the UK economy – in order to deliver jobs, growth and increased productivity.

“Now is the time to make structural reforms to ongoing but fundamental SME concerns such as late payment, while reducing business burdens and investing in future capacity and the low-carbon economy.”

BESA public affairs and policy manager, Alexi Ozioro, added: “We have engaged with the Treasury and Chancellor and are hoping for a positive budget. The Chancellor has made clear he wants to tackle late payment, improve productivity and level the playing field for SMEs. Alongside our calls for retentions reform, it would be positive to see Government supporting new skills the industry needs for modern construction; like offsite, modular and green building.”

Chancellor Philip Hammond MP will deliver the Budget on Monday October 29.