Spring Statement uodates progress on late payments

Late payments are an issue that can cause serious pain in the channel with resellers spending precious time chasing invoices from large suppliers.

The Federation of Small Businesses has been leading a campaign on the issue and is ramping up its calls for government action with the topic getting a mention at the Spring Statement.

A year ago the Chancellor announced that it would do everything to crack down on late payments and that promise was also given the thumbs up by the Prime Minister and Business Secretary.

A year on and the FSB not only wants to know what has been done in the last 12 months but also for a further commitment from the Chancellor to keep on top of the issue.

"We need to tackle the scourge of late payments," said Chancellor Philip Hammond. "As a first step we will require company audit committees to review payment practices and report on them in company accounts."

He indicated that there was a determination to get on top of the issue and that was shared by other cabinet ministers.

“Small businesses are sick and tired of being left out of pocket by some unscrupulous big businesses taking advantage of this imbalance in power to improve their own balance sheets or mask their own financial failings. Nobody should want to see small business owners turning to personal credit cards or overdrafts because of late payments, or even worse for a business to go under as a result of not getting paid," said National Chairman of the FSB Mike Cherry.

"The commitment from the Chancellor that the Business Secretary will see this through is welcome, and we are especially pleased that the first measure has been announced – to make a Non-Executive Director responsible for the supply chain through the Audit Committee of every large business, and to report back through the Annual Report on their progress," he added.

“The end of late payments could finally be in sight. It can’t come soon enough, to bolster small businesses at a time when they are in great need of support and a lift in confidence,” he added.

Philip Hammond was standing up at the dispatch box just hours after the Prime Minister failed to get her Brexit withdrawal agreement through parliament for the second time.

There have been calls by some other business organisations to end the uncertainty around Brexit and help those channel firms that are incurring costs through stockpiling in the event of a no-deal.

“Enough is enough. This must be the last day of failed politics. A new approach is needed by all parties. Jobs and livelihoods depend on it," said Carolyn Fairbairn, CBI Director-General.

“Extending Article 50 to close the door on a March no-deal is now urgent. It should be as short as realistically possible and backed by a clear plan," she added.