ACCA backs gov move to tackle late payments

ACCA has welcomed government proposals to back small businesses and tackle late payments.

The government has announced tougher measures to tackle the issue of late payments to small businesses and these new measures will be included in the upcoming Prompt Payment and Cash Flow Review, due to be published shortly and will improve delivery and enforcement of policies, enabling more small businesses to get paid on time.

Following consultation, the government will take forward legislation to extend payment performance reporting obligations.

It will also include new metrics for reporting, including a value metric, so businesses and commentators can see the value of invoices, including invoices paid late, and a disputed invoices metric.

Glenn Collins, head of technical and strategic engagement, ACCA UK, said: “As we have made clear in our response to government consultations, we welcome any move to help tackle the late payment crisis.

“Being paid on time is crucial for small businesses to thrive. Recent ACCA research highlighted the challenges SMEs face accessing finance, including the critical impact late payment has on cash flow. So we welcome the government’s announcement of further action to tackle poor payment practices.”

He added: “In our response to the government’s consultation earlier this year we underlined the key role the small business commissioner plays as an external champion shining a light on unfair treatment of SMEs. We called for the office of the small business commissioner to be strengthened, so we warmly welcome plans for additional powers.

“Strengthening the regulatory regime, including payment performance obligations, is a key piece of the late payment puzzle, enabling better transparency on the performance of suppliers. However additional action, such as continued education, will be required until new legislation can be put in place. Accountants – as key advisors to small business – as well as professional bodies like ACCA, have an important role to play in sharing our experience and expertise but a collective effort is now required to change the UK’s late payment culture.”