The Federation of Small Businesses (FSB) has been leading a campaign on the issue and is ramping up its calls for government action with the topic getting a mention at the Spring Statement.
It wants the government to crack down on firms that are late paying reseller invoices
A year ago, the Chancellor announced that it would do everything to crack down on late payments and that promise was also given the thumbs up by the Prime Minister and Business Secretary.
However, that was a year ago and the FSB has heard nothing back. It wants to know what the government has been doing all this time and wanted a further commitment from the Chancellor to keep on top of the issue.
Philip Hammond stood up at the dispatch box just hours after the Prime Minister failed to get her Brexit withdrawal agreement through parliament for the second time to provide some assurance that something was being done.
He said: “We need to tackle the scourge of late payments. As a first step we will require company audit committees to review payment practices and report on them in company accounts.”
National Chairman of the FSB, Mike Cherry said: “Small businesses are sick and tired of being left out of pocket by some unscrupulous big businesses taking advantage of this imbalance in power to improve their own balance sheets or mask their own financial failings. Nobody should want to see small business owners turning to personal credit cards or overdrafts because of late payments, or even worse for a business to go under as a result of not getting paid.”
“The commitment from the Chancellor that the Business Secretary will see this through is welcome, and we are especially pleased that the first measure has been announced – to make a Non-Executive Director responsible for the supply chain through the Audit Committee of every large business, and to report back through the Annual Report on their progress”, he added.
“The end of late payments could finally be in sight. It can’t come soon enough, to bolster small businesses at a time when they need support and a lift in confidence”, he continued.
Philip Hammond was standing up at the dispatch box just hours after the Prime Minister failed to get her Brexit withdrawal agreement through parliament for the second time.
There have been calls by some other business organisations to end the uncertainty around Brexit and help those channel firms that are incurring costs through stockpiling in the event of a no deal.
