Earlier today, the Department for Business, Energy & Industrial Strategy (BEIS) outlined new proposals to empower the Small Business Commissioner (SBC) to ensure that SMEs across the UK are paid on time.
To date, £23.4 billion worth of late invoices are owed to SMEs across the United Kingdom, impacting their cashflow and survival. This is putting extra pressure on SMEs already impacted by the COVID-19 pandemic.
The proposals are a part of a new consultation launched today, and plan to allow the Small Business Commissioner to:
- Order companies to pay their partners, in the form of either a lump sum or an agreed payment plan, when a complaint for late payment has been investigated and upheld. Companies that fail to do so face fines and further penalties.
- Compel companies to share information during investigations by the SBC, ensuring cooperation and garnering more information about payment practices.
- Launch investigations into suspected bad payment practices, without needing to have first received a complaint from an SME.
- Expand the scope for complaints, allowing the SBC to investigate complaints in connection with payment matters and the supply of goods and services.
- Review and report on wider business practices outside of payment matters, when directed by the BEIS Secretary of State, for example on supply problems or broader issues like barriers to adopting payment technology.
- Claim investigation costs from a company when there are adverse findings against it.
The consultation runs from today until 24 December 2020, and can be accessed online here.
techUK welcomes the expanded scope of the SBC, as late payments were a significant issue for many SMEs, including techUK members early on the pandemic.
If you or your business were affected by late payments, the SBC is undertaking a survey until 16 October 2020, aimed at gathering views on the potential reform of the Prompt Payment Code. The survey can be found online here.