A member of the UK200Group comments on news that a small business tsar is to be appointed
A member of the UK200Group has commented on news that a small business tsar is to be appointed by ministers to adjudicate on rows over late payments. Following a consultation, the commissioner will be created through the Small Business, Enterprise and Employment Act, which is expected to go through parliament in the autumn. The commissioner will have the power to investigate complaints and name and shame firms that fail to adhere to the terms of transactions, as well as help firms to obtain advice and support.
Jonathan Russell, partner, UK200Group member firm ReesRussell, said: “The problem of late payment is a bit like a stuck record and it is all very well blaming big companies but small companies are equally guilty in slow paying. Also they are often guilty of not supplying large customers with the necessary paperwork at the right time and in the right form to ensure their payments are processed. That does not mean that some large companies, even when in receipt of everything they need, are still not paying within the agreed terms. For large companies this is a conscious decision to systematically delay payment as unlike small businesses with a limited number of people involved in the payment process, payments cannot be flexed backwards and forwards to suit but must be set down within the overall payment system. That large companies which do not adhere, even to their own often extended terms, should be publically named and shamed might have more impact than any legislation as we have all seen the power of social media and social image is becoming increasingly important to large companies.”