New measures to tackle the problem of late payments to small businesses by large companies who abuse their position in the market have been unveiled by the Small Business Minister Kelly Tolhurst, who launched a call for evidence.
Nearly a quarter of UK businesses report that late payments are a threat to their survival. Tackling them represents a huge opportunity for economic growth, with research from the Federation of Small Businesses suggesting it could add £2.5 billion to the UK economy and keep an extra 50,000 businesses open each year.
The new proposals include:
- promoting innovative technologies, such as the latest accounting software, to help small firms manage their payments processes, and empowering trade bodies to highlight the best and worst practices in payment behaviour
- considering the best way company boards can put in place responsible payment practices throughout their supply chain, for example giving a non-executive director specific responsibilities for the company’s prompt payment performance
The publication of the new call for evidence follows an announcement by the Business Secretary Greg Clark earlier this week where he set out other new measures to support small businesses, including:
- the Small Business Commissioner to join the Prompt Payment Code’s Compliance Board to support his role in tackling late payment
- the board to consider all complaints made about compliance as part of regular reviews, and report on all cases of signatories being removed from the code
- further reform to the code to be considered including whether the Small Business Commissioner should have a greater role in its administration
TIGA will contribute to the call for evidence and encourages its members to contact firstname.lastname@example.org with any comments. 95 per cent of games companies are small or micro businesses.
The call for evidence is available to view here