ABTRACT

The construction industry plays an important role in Nigerian soci-economics development. It is both growth-imitating, and growth-dependent. The industry establishes buildings and infrastructure works required for socio-economic growth. The success of economic development will further lead to increase in disposal incomes, thereby generating demand for additional construction activities. 

However, there remains a chronic problem of delayed and non-payment in the payment in the industry affecting the entire project delivery chain.

The Nigerian construction industry operates the outdated and inefficient payment practices which were inherited from our colonial masters.

The security of payment problem is common to many commercial relationships, but the construction industry presents a peculiar problem, because payment terms are on credit, rather than on delivery.

The growing affluence and higher quality expectation of purchasers and consumers spurs developers to stipulate longer defects liability period and higher retention amount.

This study therefore focuses on the causes, effects and reactions of indigenous contractors to late and non-payment issues and to identify ways to mitigate the problem. The research focused on contractual payments from the employer to the contractor.

To facilitate the study, fifty questionnaires received from the filed survey of relevant construction companies were analyzed using mean item score, while two hypotheses were tested using the chi-square.

Findings from the study indicate that the main factors causing for Late and non-payment in the construction industry identified are: Delay in certification, employer’s poor financial management, local culture/attitude, underpayment of the certified amount, and short of current year budget. 

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