The UK government will open a consultation on late payments to SMEs, Chancellor Philip Hammond and Small Business Minister Andrew Griffith have said.
In his spring budget statement last week, Hammond said the government would open a call for evidence on “how we can eliminate the continuing scourge of late payments”. Griffith later confirmed this at a parliamentary reception event the same morning.
Griffith said: “If we want a healthy economy with a strong and robust supply chain then tackling late payments is a huge priority for us as a government, for businesses and the credit industry.”
He referenced Carillion’s collapse, and subsequent difficulties for businesses that were still owed by the construction giant.
He said: “We had to look at what we could do to protect 18,500 jobs that were employed by Carillion and the many hundreds of thousands employed by the tens of thousands of SMEs in the supply chain.
“Not only is Carillion a challenge in dealing with the fallout of what is possibly the biggest liquidation of a government contractor we have ever seen but, I think it also provides an opportunity.
“I think it can be a catalyst for us to look at the way government operates and to develop a policy that works for the 5.7m SMEs who are up and down the country.”
In December, the government appointed Paul Uppal to the newly-created position of Small Business Commissioner. One of Uppal’s first initiatives in the role was to launch a payment dispute resolution service for SMEs, next to releasing guidelines advising businesses on how to pursue late invoices and take action if necessary.
Late payments are also one of the areas being looked at by Parliament’s Business, Energy & Industrial Strategy (BEIS) and Treasury committees, which jointly launched a consultation on small businesses in January.