Oireachtas Joint and Select Committees
Wednesday, 27 April 2022
Joint Oireachtas Committee on Transport, Tourism and Sport
Reform of Public Works Contracts for the Construction of Transport Infrastructure: Discussion
Mr. Paul Sheridan:
The most important legislation to protect the supply chain is the Construction Contracts Act. A contractor operating as a going concern, has a legal obligation to pay for the work being done within 30 days. It is set out in legislation. There is a mechanism to challenge any disruption to that cash flow. The CIF was very much involved in it and supports it. That is there to protect the supply side. Mr. Parlon can comment on this. If a major contractor has gone out of business, obviously that creates a significant problem for the supply chain which is very difficult to control unless the client steps in and says, "Right that person is gone as a contractual entity. How can I create some kind of relationship to try to support these subcontractors that are still going concerns but have a major black hole in their balance sheet?" That is very much down to the client and how they want to resolve it.
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