FIRMS WORKING in the former eastern-bloc are facing severe delays in securing fees worth millions of pounds, the British Consultants Bureau warned this week.
But it is grinding Brussels bureaucracy rather than the collapse of Russia's rouble that is forcing firms to wait in excess of 200 days for payment.
Affected firms are involved in projects funded by the European Union's Technical Assistance for the Commonwealth of Independent States scheme.
According to British Consultants Bureau executive director Colin Adams, many of the 50 BCB members currently working on Tacis projects are suffering. Outstanding fees range between pounds 150,000 and pounds 250,000.
'EU officials are oblivious to commercial realities, treating companies as adversaries, not as partners. Tacis is a dog's breakfast,' Adams commented. 'It is a nugatory waste of EU development money.'
Adams is lobbying the Department of Trade & Industry and the Department for International Development to investigate the mismanagement. Incoming BCB chairman and Knight Piesold director Peter Garratt, whose own firm is experiencing payment difficulties on a Tacis project, told NCE: 'This problem needs tackling. We welcome the BCB's action.'
John Carroll, head of the commercial section at the UK Permanent Representation in Brussels, explained that there are 11 separate stages in invoice processing. Despite this, he described staffing in the department responsible for handling tenders and payments as skeletal.
A planned restructuring will create a purpose-designed office, the Service Commune Relations Exterieur, with the aim of meeting a 30 day target for payments. However, according to Adams, as invoices are presently in crates pending relocation, even longer delays are anticipated as a result.
Not only does chasing invoices place a strain on small companies, it creates an uncompetitive market, Carroll commented. Large firms are better able to hold out against banks and cover bank loans required to carry out work. Though 6% interest is paid by the EU on late settlement, it does not always cover the consultant's costs, he said.