FIS has led a coalition of specialist construction trade bodies in writing to Housing Minister Steve Reed OBE and the National Housing Bank, calling for urgent action to address growing liquidity pressures in the housing supply chain.
The letter, supported by organisations representing roofing, electrical works, carpentry, flooring, plumbing, groundworks and other key trades highlights mounting evidence that poor payment practices are creating systemic risk across housing delivery. FIS research shows that specialist contractors are typically providing between 60–78 days of unsecured credit for completed work, with nearly one fifth of invoices paid more than 60 days late. Retention release, despite recent positive steps from Government towards wholescale reform, continues to be inconsistent and often delayed.
The coalition warns that this hidden, unstructured credit, estimated to exceed £1 billion across the seven largest UK housebuilders on late and disputed payment alone, is undermining investment much needed investment in skills, productivity and capacity, and ultimately constraining the sector’s ability to deliver at scale. To address the issue, FIS and the supporting organisations are urging Government to use the emerging National Housing Bank as a lever for change. Specifically, putting forward proposals to link development finance to mechanisms that improve liquidity through the supply chain, including the use of digital payment systems that ringfence funds and improve payment certainty.
These systems, already in use in parts of the industry, can reduce insolvency risk, improve transparency, and support SME investment without increasing public spending. The proposal aligns closely with wider Government policy on fair payment, procurement reform, and digitalisation, and offers a practical, finance-led intervention ahead of more comprehensive legislative reform on payment and retention.
FIS CEO Iain McIlwee said:
“Responsible payment isn’t just a commercial issue – it is fundamental to delivery, skills and system resilience. If we want a housing market that can grow sustainably, we need a supply chain that is stable, has the means and confidence to invest in people and improvement. It is also a human issue, our research into the Housing Sector identified that approaching 60% of specialists in our supply chain were worried about cash at least half the time”
FIS and its partners have requested a meeting with Ministers and officials to explore how these measures could be implemented proportionately to support a more resilient housing delivery system.
You can see a full copy of the letter here..