A qualified welcome to the government’s late payment proposals
Eazipay Ltd, one of the UKs largest Direct Debit processing companies has issued a cautious welcome to the announcement that the Department for Business, Innovation & Skills is introducing proposals to address the national scandal of late payments.
The government is proposing that larger companies together with listed companies will report on a quarterly basis, disclose information on payment practices, publish the information on their website and will face fines if they breach the requirements.
Luisa Grey, a director with Eazipay, said: “We have been calling for concerted action from the government to tackle the scourge of late payments for the last several years but it has not come forward in any meaningful way to help protect companies from the vicious circle of late payments.
“We have also been vocal in our of criticism of the Prompt Payment Code which we see as a cynical opportunity for companies to publicly say they are prompt payers while unfairly keeping their suppliers waiting to be paid.
“Of course we welcome the fact that the government recognises the enormity of the late payment problem and the establishment of the Prompt Payment Advisory Board. Our concern is that nothing concrete will emerge at the end of the consultation process except well-intentioned words that fall short of the action and support companies need right now.
“As it stands, the Prompt Payment Code means very little and promises to ‘name and shame’ late paying companies have never materialised, so it is unsurprising that businesses are taking a jaundiced view of the government’s real commitment to actually getting to grips with this growing problem.”
The difficulty, believes Luisa, is that late payments are so endemic that they have developed into a late payment culture which will be difficult to change now that it has become so entrenched.
Luisa, said: “Government has allowed this problem to grow and the consequences for businesses up and down the country are intolerable with perfectly sound businesses going to the wall.”
Eazipay has said that it will be formally making its views known by responding the Duty to Report Payment Policies and Practices consultation document published by the Department for Business Innovation and Skills.
