Credit squeeze causes 56% rise in builders' calls for help

Record numbers of builders are seeking legal advice over the phone to deal with mounting numbers of customers who do not pay their bills.

The volume of calls from small and medium enterprises (SMEs) to the National Federation of Builders’ (NFB) legal helpline rose 56% in the first three months of 2008 compared to the same period last year.

More than 650 calls were logged in the first quarter of 2008, many regarding non-payment of bills to SMEs by customers ranging from major contractors to individual people.

NFB chief executive Julia Evans said it suggested the credit crunch was hitting consumers and businesses hard.

She said: “There is mounting pressure on business owners operating in this sector, whether small, medium or large.

“The problem is however particularly acute for small and medium sized firms, who don’t have the same reserves or resources to withstand the pressure. They may not have in-house legal or HR teams and cannot afford the rates of professional advisors”

Statistics by PricewaterhouseCoopers show 431 construction firms have entered into insolvency so far this year.