In 2017, the Government launched new regulations called Duty to Report on Payment Practices and Reporting (PPR). This requires all UK companies of a certain size to post their payment data on a Government portal. As a result, 14 Kier trading entities are required to send data to the Government portal every six months. This data covers:

• The average number of days taken to pay invoices .

• The % of invoices not paid to terms.

• The % of invoices paid within 30 and 60 days, and beyond 60 days.

The table below show the progress that Kier Group’s registered trading entities have made in the last six months. We are pleased we have delivered a marked improvement against all three metrics. 

 

 

Jul - Dec 2018

Jan - Jun 2019

 

% Paid within 60 days

Average time to pay

% Invoices paid late

% Paid within 60 days

Average time to pay

% Invoices paid late

KIER CONSTRUCTION

65%

52

57%

75%

42

45%

KIER SERVICES

77%

60

55%

95%

18

27%

KIER INTEGRATED SERVICES

63%

49

83%

77%

49

49%

KIER HIGHWAYS

55%

65

52%

79%

45

29%

KIER INFRASTRUCTURE AND OVERSEAS

74%

55

52%

83%

41

41%

KIER BUSINESS SERVICES

60%

81

81%

90%

29

71%

KIER FACILITIES SERVICES

75%

52

48%

94%

21

35%

KIER FLEET SERVICES

74%

56

74%

85%

45

49%

KIER LIMITED

82%

42

64%

82%

32

69%

KIER LIVING

58%

68

72%

73%

44

67%

KIER NORTH TYNESIDE

93%

32

30%

91%

29

23%

KIER PARTNERSHIP HOMES

59%

79

60%

70%

49

54%

KIER PROPERTY DEVELOPMENTS

65%

62

67%

80%

36

51%

MCNICHOLAS

40%

77

97%

55%

67

88%

Notes

Jan-Jun 2019 performance is based on transactional level payments made during the six months of the current PPR reporting period

Jul-Dec 2018 and Jan-Jun 2019 ‘Average Time to Pay’ for Kier Group is based on weighted average days to pay of transactions across the group 

We are committed to reaching the target of 95% of payments made paid in 60 days. The table below shows the steps we are taking in our action plan, and this covers the following areas:

• Supplier engagement & compliance

• Process simplification

• Guidance & training 

• E invoicing 

• Payment scheduling

 

The primary causes of non-compliance

Actions to address each of the causes

Supplier compliance with Kier invoicing requirements is variable, causing issues and delays in processing and matching invoices. 

e.g. Invoices received not in line with purchase order or  information missing resulting in manual intervention and delay.

• Work with supply chain partners to improve straight through processing rates and upskill where required.

• Improve compliance, reducing subsequent payment delays.

Over-complex, burdensome end to end Procure to Pay ("PTP") process in particular for certain low value, low risk transactions types. 

e.g. 3 way matching required on majority of invoices.

Simplify process, approvals or procurement route for low value, low risk transactions.  

• Develop system automation routines where possible, including Bulk Receipting to improve accuracy & speed of invoice throughout. 

Recent ERP system implementations have led to internal variation around  key disciplines required to ensure an effective end to end PTP process.  

e.g. Raising good quality purchase orders, timely receipting and timely subcontract approvals.

Move to a standardised process wherever possible supported by clear "how to" guides and pro active training.  

• Monthly monitoring of key performance indicators across end to end process, with follow up for corrective action.  

Current ERP setup is reliant on multiple systems and interfaces, requiring high amounts of manual handling or intervention to process invoices, resulting in payment delays. 

• Continue roll out of enhanced e-invoicing process to streamline the process, reduce errors and queries and provide visibility of transactions to both Kier and its supply chain.  

• Enforce invoice and order discipline.

Current process for scheduling payments does not allow sufficient flexibility to ensure all invoices are paid to terms. 

• Review and streamline payment scheduling and review payment terms to improve compliance. 

• Apply auto payment for low value approved invoices.

 

For further information:

Media Enquiries:

01767 355096

Routine queries:

Fssc.supplierqueries@kierfssc.supportsystem.com

KEPS queries:

Fssc.subcontractorqueries@kierfssc.supportsystem.com

Subcontractor queries:

Fssc.subcontractorqueries@kierfssc.supportsystem.com