Government will appoint small business commissioner to tackle late payments » SMEInsider

Government will appoint small business commissioner to tackle late payments

As part of the new Enterprise Bill, the government will be appointing a new small business commissioner whose role will be to tackle late payments for goods and services.

The government estimates that SMEs are owed £26bn in late payments, and they are spending on average £10.8bn a year in an attempt to recover overdue payments.

Under the government plans, the commissioner would act as the first point of contact for small businesses that are having issues with late payments. The commissioner would provide support and advice on how best to avoid or resolve disputes.

He or she would also provide access to mediation services that will help resolve the disputes quickly and at a reasonable cost – “at a fraction of going to court”.

The commissioner would also have an investigatory role – he or she would look into complaints over unfair practices and file regular reports.

The minister for small business, Anna Soubry, said that the new position would redress the “imbalance” in power between small and large businesses.

The issue of late payments can be very damaging to smaller businesses, especially when so many have experiences it. Over 80 per cent of small businesses that had experiences with late payments have said they only received the payments a month or more after the agreed deadline.

  • Carl Nisser

    Late payments are very – if not seriously – destructive to small businesses of all kinds. A quick survey should establish whether or not public authorities pay within the 30 days required as set out in Directive 2011/7/EU on Combating Late Payment in Commercial Transactions: a Users Guide to the Recast Late Payment Directive. And, if businesses pay within the required 60 days. The Commissioner should quickly consider amending the laws to make them more efficient and check how outstanding invoices are collected in other countries where the culture to pay bills on time is more prevalent.

  • Peter Curnow-Ford

    Late payments is just one part of the problem. Extended payment terms are the worst, I have just seen a PLC trun round in its contracts and move from 30 days to 60 days irrespective of the size of the supplier, this plc is of course listed.

    This is not right, retailers have already been hammered [but yet to react] for payment terms up to 75 days ( eg Boots).

    Fix this first and then fix late payments.

  • Jan Bros

    I welcome the initiative but think in practice it will be as much use as a chocolate teapot……. if as an SME you ever do have the temerity to take a public authority (or any other other large organisation for that matter) to law over late payments their immediate answer is “Fine – take us to court to recover the money – but not if you want another contract with us…… ever”. But I would sure welcome access to mediation in cases of late payment…The jury is still out.