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Four out of five businesses unpaid in Scotland's late payment 'epidemic'

Subcontractors in Scotland are owed an average of £90,000 in unpaid bills, new data has revealed.

A survey by the Scottish Building Federation has revealed that the problem of late payments has reached “epidemic proportions” in Scotland, with four out of five firms still waiting to get paid.

It also found that firms have had to write off an average of £6,000 in unpaid invoices in the past year.

The report comes as official statistics show that 164 Scottish building firms were forced into bankruptcy last year, a rise of 122 per cent on the number of construction companies going bust in 2008.

“Late payment of invoices has long been the bane of many construction firms. But in the current economic climate, it risks becoming the difference between continued trading and business failure,” said Scottish Building Federation executive director Michael Levack.

“For Scotland’s construction industry, this survey demonstrates that late payments have become an issue of epidemic proportions, affecting an overwhelming majority of businesses, irrespective of their size.”

Levack said that a majority of construction firms have been forced to write off outstanding payments worth thousands because of persistent non-payment.

“It is a tragedy that otherwise excellent businesses are forced into bankruptcy because of a lack of the cash-flow they need to pay bills and salaries when customers fail to pay their bills on time – or at all.”

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