Businesswoman calls for late payment law
UK entrepreneur and SME owner Beatrice Bartlay has welcomed Prime Minster David Cameron’s pledge to do more about late payments to Britain’s small firms today, and said that the Government needs to remove the temptation to retain creditors’ cash and work harder to instil a culture of paying on time throughout the supply chain.
Cameron announced today that Number 10 would be taking even further measures to curb late payments to SMEs supplying other firms, following August’s announcement by Vince Cable that fines may be introduced for those contributing to the £30.2bn owed to these companies just this year.
Bartlay, managing director of specialist staffing firm 2B Interface, said, “The ramp up in interest from the UK Government around late payments and the significant damage it can do to our country’s small businesses is of course extremely welcome, but perhaps long overdue. The previously announced levies that may be imposed will go some way to reduce late payments, but the question is: will hit the bigger businesses’ back pockets hard enough?
“This is more than a slap on the wrist. The PM’s commitment to changing the mindset of business culture in this country and supporting each other to thrive in a recovering economy is much more important. Paying within 30 days – not 60 as is currently & lsquo;advised’ by the non-compulsory code - should be the norm,” she said.
Bartlay concluded, “It’s a very simple premise: the reason the bigger companies hold onto cash for as long as possible is to improve cash flow. It can’t be ignored that this is a practice rife among businesses globally but it only serves to harm everyone else down the supply chain. Until the supplier is paid, they can’t pay their suppliers, and so on. It has been proposed that companies are offered complete transparency on who is a good payer and who is not. If you hold onto money and miss deadlines then it will only serve to your company’s detriment in the longer term. A change in culture and mindset will mean that everybody benefits from better relationships and stronger financial stability.”