New Commissioner ‘to help small firms tackle late payment issues’
The government is planning to appoint a Small Business Commissioner to help firms tackle late payment problems and unfair practices carried out by larger companies.
The move comes after research by Bacs showed that small and medium-sized businesses are owed a total of £26.8 billion in overdue payments and that £10.8 billion is spent per year in attempts to recover overdue payments.
A survey by the Federation of Small Businesses in 2014 revealed that 51% had experienced late payment within the previous 12 months.
A new commissioner would be able to offer advice and conciliation services, and would have the power to look into complaints and publish the findings.
Small Business Minister Anna Soubry said: “Small businesses are owed £26 billion in late payments and spend millions more chasing down money they have already earned through hard work. This is simply unacceptable – it limits their growth and productivity, and can put an otherwise successful business at risk.
“The Small Business Commissioner will tackle the imbalance of bargaining power between small suppliers and large customers, and encourage them to get round the table and sort out disputes at a fraction of the cost of going to court. It will also provide advice, investigate complaints and see where further action is needed to clamp down on unfair practices.”
The government has published a discussion paper on the proposal to appoint a commissioner and is asking businesses for their views. You can access it here. https://www.gov.uk/government/consultations/small-business-commissioner-role
We shall keep clients informed of developments.
Please contact Thomas Nolan if you would like more information about the issues raised in this article or would like help with debt collection or credit control issues.