New proposals have been outlined by government to ensure small businesses in the UK are paid on time. Currently £23.4 billion worth of late invoices are owed to small firms across Britain, impacting on businesses’ cash flow and ultimate survival.
The proposals, as part of a new consultation launched 1 October 2020, look to give new powers to the Small Business Commissioner including:
- the power to order companies to pay their partners, either as a lump sum or agreed payment plan, when a complaint against them for late payment has been investigated and upheld. Companies which do not do so could face further penalties, including fines. This will give a clear incentive for companies to pay their partners on time.
- the power to compel companies to share information during an investigation by the SBC. This will ensure cooperation with SBC investigations and provide more information about company payment practices.
- the power to launch investigations into suspected bad payment practice, without the need to have first received a complaint from a small business.
- expanding the scope for complaints to the SBC, to allow the Commissioner to investigate complaints about other businesses relating to payment matters in connection with the supply of goods and services.
- to review and report on wider business practices outside of payment matters, on instruction of the BEIS Secretary of State. This could be a practice unrelated to payment matters specifically impacting small businesses such as supply problems, or broader issues like barriers to the adoption of payment technology.
- the power to claim investigation costs from an investigated company when there are adverse findings against them.
The consultation opens 1 October 2020 and will run until 24 December 2020. Businesses are invited to share their views.All news
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