Whilst there are some exceptions to the general rule, the recent PPN Supplier Relief due to COVID-19 (PPN 02/20) will apply to Registered Providers.

The PPN does seem to suggest that a Registered Provider should pay a contractor agreed payments even where a contractor is no longer carrying out works due to the COVID-19 restrictions.  The main reason is to try and support contractors through these tough times.

But does the PPN give carte blanche to contractors to demand monthly payments be made, especially on construction projects, whether works have been carried out or not?  We do not think so.  It is clear that the PPN is seeking to encourage parties to do what they can to support each other through this period of “lock down” but it is not intended to allow a contractor to demand full payment for works that have not been (and will not be) carried out by such contractor. It is also not intended to reward underperforming contractors or those who have no guarantee of work to begin with.

The PPN does encourage all public bodies to look at how they can assist their supply chain through this period. This might include help with actual (and properly evidenced) costs, but Registered Providers are also encouraged to look at other ways that it can assist a contractor -  this might be in terms of reducing the number of days from receipt of an invoice to payment.

In addition, the PPN does not require Registered Providers to act outside their powers, or to put themselves in breach of e.g. their obligations as charities.

If you would like to discuss this issue further please contact Angela Lovett


For further support and advice relating to the impact of COVID-19, please view our COVID-19 Advisory Service page.

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