The government’s Small Business Minister, Paul Scully, has announced new proposals to ensure that small businesses in the UK are paid on time. Currently £23.4bn of late invoices are owed to small firms, which obviously impacts on cashflow and ultimately survival. The proposals give the Small Business
Commissioner new powers including:
- The power to order companies to pay their partners when a complaint against them for late payment has been investigated and upheld. Failure to do so could result in further penalties and fines.
- The power to compel companies to share information when being investigated by the Small Business Commissioner;
- The power to launch investigations into suspected bad payment practices without the need to have first received a complaint from a small business;
- An expanded scope for complaints;
- The power to claim investigation costs from an investigated company when there are adverse findings against them.
According to the Federation of Small Businesses (FSB), around 50,000 small companies close each year due to late payments. With many UK businesses continuing to struggle with the impact of coronavirus, it is a particularly urgent issue.