U.K. Chancellor Philip Hammond was urged by the Federation of Small Businesses (FSB) to combat the late payments problem, which recent FSB data suggests is actually getting worse, despite numerous steps by the U.K. government to address the issue.
Reports in Real Business on Tuesday (March 13) said the chancellor’s first Spring Statement was preceded by calls from FSB Chairman Mike Cherry to use the Spring Statement platform to address the issue of late payments.
“The late payments crisis will only end when we see a fundamental cultural shift in the boardroom, with those at the top collectively addressing the issue and directors held accountable for supply chain support,” Cherry said. “Improving the nation’s productivity forecasts starts by speaking out on late payments today. In doing so, the chancellor will send a clear message to British boardrooms.”
The FSB’s latest research found 84 percent of business owners in the U.K. said they are regularly being paid late. One-third said at least a quarter of the payments they’re owed arrive late. In the last two years, 37 percent of small business (SMB) owners said their customers have forced longer payment terms on them, leading to cash flow issues.
Just 4 percent of U.K. small business owners said they have experienced an improvement in late payments in the last two years, report said.
Cherry also asked the chancellor to use his speech to address SMB tax issues and described the Spring Statement as “an opportunity to reinforce commitment to promises already made.”
The chancellor’s Spring Statement ultimately focused on the upwardly revised growth forecast for the U.K., the downwardly revised forecast for borrowing and expectations for debt to decline in the U.K. Hammond did, indeed, mention a plan to address late payments as well, vowing to “eliminate the continuing scourge of late payments.”