UK Company Urges Late Trade Payments Legislation Rethink
Following another cut in interest rates, Graydon UK has called upon the country’s government to do more to support small businesses in protecting their cash flow at a time when economic stability is facing increasing pressure. Martin Williams, managing director of the company, highlighted the additional suffering piled upon SMEs by the UK’s culture of late payment of trade invoices, which has persisted despite legislation introduced in 1998 in the form of the Late Payment of Commercial Debts (Interest) Act. This view has also been backed up by both the Institute of Credit Management and Forum of Private Business. Recent research by BACS estimates the value of outstanding payments owed to SMEs in the UK is at a total of £18.6bn. Small business owners and directors are voicing the belief that the government must now initiate new regulation to tackle this growing problem via a Department for Business Enterprise and Regulatory Reform (BERR) review. One idea is that BERR inspectors could then carry out spot checks on bought ledger departments within these organisations to see whether there was compliance with payment standards.