Government delaying payments for years: contractors
Millions in unpaid bills claimed
Road builders in Saskatchewan say the province owes them millions of dollars in "final payments" and some of those bills have remained unpaid for years.
Highway contractors receive payments progressively as each stage of a project is concluded.
"Once the job is completed and passed you're supposed to get paid your final," explained Sean Wilson, chair of the Saskatchewan Heavy Construction Association board. "And there's numerous contracts the finals have not been paid out. And that's a common trend."
The size of the final hold-back can vary but Wilson said it's often around 10 per cent of the total contract.
The executive director of the association, Shantel Lipp said in some cases contractors are waiting for a final payment totalling several hundred thousand dollars.
"There are some contracts that have been delayed payment by two to four years," Lipp said. "So contractors will be waiting for their final payment for a substantial amount of time which has an impact on a contractor's ability operate his business. It impacts cash flow."
She noted that in one case a contractor has been waiting seven years for his final payment.
Contractors seek explanation
Lipp said she's been pushing the ministry of highways to deal with the final payment issue for years, but the problem remains.
According to Lipp, government officials routinely provide the same excuse.
"Resources. Staffing resources," Lipp said. "When we've raised it with the ministry they've told us that they're doing the best they can to get those payments processed and get the money out to the contractors."
Ministry admits problem
Officials from the ministry of highways acknowledged there is a problem, but says both sides are to blame.
"We could be doing better — jointly — with respect to faster final payments," Deputy Minister of highways, Nithi Govindasamy told CBC's iTeam. "I'm working with the construction association on ways we can improve. Both of us."
According to Govindasamy, it's important for the ministry to hold onto a final payment in order to ensure a job is completed properly and that any outstanding penalties are paid.
He added he believes the problem is not related to a lack of staff or resources.
"I'm convinced that we can make some process improvements in terms of getting the payments out faster," he said. "I'm also convinced that if we are waiting for paperwork to come in from contractors or consultants, perhaps there is a communication issue in terms of what we are waiting for and what they have supplied."
Govindasamy said he doesn't know how much money is still outstanding.
"I haven't examined all of the numbers and to me that's not very relevant," he explained. "What we are doing is working with the construction association to make sure that we are both doing our part with respect to making progress payments and final payments."
While he did not have any numbers, he told CBC's iTeam that progress was being made.