04 Jun 2014
Business Secretary Vince Cable has outlined measures to increase transparency in a bid to tackle the problem of late payment and help small firms to get paid on time.
In a recent consultation on the issue of late payment, a clear majority of businesses called for measures to improve disclosure, and the Government has announced that it will be compulsory for large firms to publish information regarding their payment practices.
The Government also plans to take steps to remove the legal barriers which can prevent businesses from accessing invoice finance.
In addition, the Government aims to work with the Institute of Credit Management to strengthen the Prompt Payment Code and increase the accountability of signatories.
Commenting on the consultation, Matthew Fell of the Confederation of British Industry said, ‘The Government is rightly looking to build a prompt payment culture, and greater disclosure of payment practices can help with this. However, it must be implemented flexibly, on a ‘comply or explain’ basis’.
‘The most effective supply chains are collaborative, rather than confrontational, so heavy-handed regulatory interventions must be avoided at all costs.’