Copy article

Late payments and the Autumn Statement

ended 22. November 2023

The Government has today announced that, from April 2024, it will be clamping down on any company with large Govt contracts and making them pay within 55 days with a view to bringing that down to 30 days. Any thoughts on this, send them across ASAP as this story is BREAKING.


 

6 responses from the Newspage community

Copy all

Star Quote
Copy

Editor
Ken James
Director at Contractor Mortgage Services
Like any good business, you want to make sure that you get paid and pay your own bills within a reasonable timeframe. The bigger the business, the longer they seem to want before paying their bill.
On what planet is this acceptable? If this was a smaller business, a lot more pressure would be brought to bear on them to pay quickly, even to the point where I am sure they may be threatened to lose the contract. It is only right that the bigger companies "toe the line" and get their bills settled in the same fashion as the smaller ones. Having a more level playing field can only be a good thing. It will get the money back into the government's coffers faster and as a small business owner I'm surprised they have not tackled this better before now.
Star Quote
Copy

Editor
Michelle Lawson
Director at Lawson Financial
Overall, this is a good outcome for small businesses for cash flow purposes but why stop at Government contracts? The Government should have gone further and made the rules apply to all.
Copy

Editor
Stephen Perkins
Managing Director at Yellow Brick Mortgages
Any company that doesn't pay their invoices should not get government contracts, end of story. I'm amazed they did before this policy as surely you would conduct due diligence? Ultimately, most contracts will be given to new companies set up by their friends with no experience or payment track record so it will probably have no impact. Late payment is a massive problem for many businesses. The government should increase the legal powers of firms to recover late payments from companies.
Copy

Editor
Justin Moy
Managing Director at EHF Mortgages
It's hard to find a lot of positives within the Autumn Statement outside of tax reductions, but announcing greater control over Government contracts overall, with quicker payment, you would think is something they would manage better in the first place. I think this shows the lack of real news within the statement.
Copy

Premium
Debbie Porter
Managing Director at Destination Digital Marketing
Do we really believe this will change anything? Late payments is a thorn in the SME community’s side but nothing seems to ever meaningfully change. In April 2018, government minister Oliver Dowden announced a clampdown on excluding businesses from its supply chain unless they adhered to prompt payments. So this new announcement is surely nothing more than dusting down that old press release. In my experience, one of the latest payers also includes any contracts with local government, so maybe they ought to clamp down on their own practices, too?
Copy

Premium
Ed Rimmer
CEO at Time Finance
The Chancellor spoke of supply side reforms in this year’s Autumn Statement, and announced measures to clamp down on late payment practices. This begs the question, what about the businesses that don’t have large Government contracts? Should the same payment practices not apply to them? Today’s announcement is another step in the right direction in clamping down on poor payment practices, but it doesn’t go far enough for SMEs. Earlier this year we surveyed our SME community to find that one in three businesses are waiting between 60 and 120 days for their invoices to be paid with SMEs owed on average £250,000 in unpaid invoices. That’s a widespread problem and the Chancellor missed an opportunity to give businesses clarity on its Prompt Payment & Cashflow Review and the further measures that will tackle this issue.