U.K. officials continue their fight against late B2B payments, with Small Business Commissioner Paul Uppal now calling on the government to fine companies that pay their suppliers late.
Reports in The Telegraph this week said Uppal wants stronger powers to combat the issue. At present, the commissioner, a new government position created last year, can only “name and shame” late payers.
“Certainly having the ability to fine focuses minds and brings more credibility to the role,” he told the Business, Energy and Industrial Strategy select committee this week. “I’m not saying we can’t change the culture [of late payments] just by having conversations and highlighting issues, but we cannot deny the reality: The ability to fine would bring more gravitas to the role.”
According to reports, Uppal raised the issue that companies confronted by the official regarding late payment practices do not typically respond in a timely manner.
Despite calls for fines, Uppal also acknowledged that he does not currently have the power to introduce such capabilities to his position. A survey by Close Brothers Invoice Finance released in March found 42 percent of small businesses doubt the ability for Uppal to have a significant impact on the culture of late payments in the country.
The small business tsar’s call coincided with new research from small business accounting company Xero, published on Thursday (April 26), reports in Global Banking and Finance Review said. According to the company’s latest survey, more than half of invoices issued through the Xero platform from small businesses were paid late in 2017. During the past year, invoices with 30-day payment terms were, on average, paid after 40 days, though smaller companies tended to pay their invoices more quickly than larger corporates, researchers said.
“Small businesses are crucial to the health of our economy, so it is vital that they feel supported in all areas, but particularly in the fight against late payments,” Uppal said in a statement commenting on the research. “My role as Commissioner exists to help small businesses get paid on time, and while the government works on measures to address the late payment epidemic, businesses should not be afraid to come to us for help. Now is the time to make Britain the best place for entrepreneurs to flourish.”