Subcontractor Payments Action Plan for Improvement

1. Investigations into the primary causes of failure to make payments to subcontractors within 60 days reveal the following themes:

• Invoices raised early e.g. before satisfactory completion of the services or agreed payment milestones
• Inconstancies such as arithmetic errors, wrongly entered dates and incorrect computation or application of VAT
• Invoices not submitted or copied to accounts payable and failing to be captured in the payment system

2. In order to address these primary causes the following actions take place:

• Queries and suggested remedial actions are identified and communicated to the suppliers at the earliest opportunity
• Suppliers are reminded of the agreed terms relating to raising invoices and encouraged to comply. Where similar issues recur, arrangements are discussed with suppliers, reviewed and clarified as necessary to achieve consistency and common understanding
• Suppliers are reminded of the need to address their invoices to the accounts payable team, whether sending physically or electronically. Technical team members are reminded to be wary of invoices received directly, to forward them to the accounts payable team and inform the supplier of how to correctly address future invoices

Communications with the suppliers on these matters take place between the respective accounting teams and also the managers responsible for delivery and acceptance of the services. This provides informed decision making, speed of resolution and reduced likelihood of issue recurrence.

3. The Accounts team provides regular reports to the Management Board (which incorporates the audit committee), setting out relevant information relating to supplier payments. The Accounts team also compiles the reporting information required for publication on the Gov.UK website for payment practice reports. Separately, the audit committee carry out cyclical and spot checks on all internal quality assurances processes including those relating to payment and report their findings to the Management Board. Our business management systems that incorporate payment processes and our compliance with them are subject to several independent, annual audit processes and the findings and recommendations from these audits are also formally reported to the Management Board.