U.K. Labour leader Jeremy Corbyn said he would “declare war” on the large conglomerates paying their suppliers late, reports said Tuesday (April 11), though the businesses he identified as culprits of late payments — M&S, E.ON, Capital and the BT group — are not recognizing Corbyn’s data on the subject.
According to reports, Corbyn spoke at a Federation for Small Business event to decry the practice of late supplier payments as the nation’s Duty to Report rules come into effect, requiring top companies to make their supplier payment practices public.
“Cash is king for any business, and big companies are managing their cash by borrowing — interest-free — from their suppliers,” Corbyn stated. “Some of the biggest names in business are holding cash piles that don’t actually belong to them. It’s a national scandal. And it’s stopping businesses from growing and causing thousands to go bust every year. It kills jobs and holds back economic growth.”
Reports said he referenced data from Experian credit reports identifying supplier payment terms of some top companies. The Labour Party said that data shows M&S goes 72 days past due on its supplier invoices, while Capita takes 82 days and National Grid takes as long as 119 days to pay suppliers past invoice due dates. But Experian has noted that this data does not take into consideration the invoices that these conglomerates pay on time.
“The data relates to how late a business can expect any late payments to be and not the company’s overall track record on the payment of suppliers,” a spokesperson for Experian said. “It is intended for indicative purposes only, to inform specific business decisions, and we would not recommend it used as an overall barometer of how a company pays suppliers.”
Meanwhile, the companies singled out by Corbyn have similarly been on the defensive. A spokesperson for M&S said, “We don’t recognize these numbers at all.”
“Over 99 percent of our supplier invoices are paid on time, and we are signatories to the prompt payment code,” M&S added.
Corbyn’s attack came as new data from Atradius found that 90 percent of businesses across Western Europe have experienced a delay on both domestic and foreign B2B invoices, affecting 41 percent of the total value of those receivables.