Late payment is a curse
The UK’s unwelcome culture of late payments continues to have a negative impact on small businesses across Lancashire and something has to change.
It is evidently clear that too little has been done to address the problem that causes so much difficulty – and can have dire consequences for SMEs.
Some businesses simply fail to survive the pressure that late payment inflicts on their operation. Others cling on through the use of overdrafts and even credit cards to keep afloat. That cannot be right.
Figures reveal that 84 per cent of small businesses in the UK have been paid late.
It doesn’t have to be like this. The Federation of Small Businesses (FSB), which is spearheading the campaign, points out that the UK is behind almost every other industrialised nation in its ability to pay SMEs on time.
The call for reform is being spearheaded by the new campaign - called “Fair Pay Fair Play”.
Campaigners want whole-board ownership and visibility of company payment practices. A non-executive director would have responsibility for payment practice and supplier relationships and be required to provide a summary of their activity for the company’s annual report.
Too little has been done to address the problem that causes so much difficulty.
Making the Prompt Payment Code mandatory for all FTSE 350 companies and handing out fines for companies that do not adhere to the Duty to Report requirements is another measure being called for.
Campaigners also want ‘Project Bank Accounts’ adopted as the truly default choice for major procurement projects, with proper Parliamentary oversight to ensure accountability.
Anything that can make the situation better and fairer can only be a good thing for Lancashire businesses.