Firms struggle to get paid as CCJs go up 55%

Construction firms are struggling even harder to get paid during the recession, with the number of County Court Judgements (CCJs) in the construction sector shooting up 55% over the past year.

Data from business information and credit analyst CreditScorer showed that there were 14,329 CCJs in the construction sector in the 12 months to April 2009, with a total value of £86.6m.

The figure is far higher than the year to April 2008, when there were 9,234 CCJs in the sector, with a total value of £57.8m.

CCJs, which are entered on the Register of County Court Judgments, are used as indicators of credit worthiness by credit rating agencies.

Commenting on the figures Suzannah Nichol, chief executive of the National Specialist Contractors Council (NSCC), which has been running its Fair Payment Campaign since September 2007 said: "These figures are another illustration of the fact that payment problems are getting worse.

"Payment has always been an issue for our members. One of our most recent state of trade surveys showed that only 2% of our members are getting paid within 30 days."

Meanwhile, preliminary findings from the NSCC's payment survey showed that, on average, respondents have paid out over £100,000 in retentions, and that over half of those are overdue.

Full results from the payment survey are expected within the next few weeks.