ACCA welcomes Gov action on late payments

ACCA has welcomed the Government action on late payments as announced by Secretary of State for Business and Trade Jonathan Reynolds.

The new Fair Payment Code which will replace the Prompt Payment Code is the “first step in the right direction”, the accountancy body has said.  

Glenn Collins, head of technical and strategic engagement at ACCA, said: “We are pleased to see this move by the government today. ACCA has been a consistent and vocal supporter of the need to ensure small businesses are paid on time and have clear knowledge of the payment practices of who they are doing business with. It is a great first step but there will be more work to do. We look forward to participating in the consultation on the proposed new laws. 

“Late payment and unfair practices continues to blight small businesses across the UK. We have long called for urgent implementation of proposed improvements to tackle late payment problems, including expansion of prompt payment reporting and the proposed expansion of powers for the Small Business Commissioner (SBC).  We are glad that some initiatives are now being taken.”  

Based on the insight from members over the last two decades, ACCA is clear that late payment is a persistent problem in the UK. Poor payment practices have a domino effect throughout supply chains, with severe consequences for cash flow and the survival of SMEs.  

Gemma Gathercole, strategic engagement lead for England, added: “We will be calling for additional reforms to provide more transparency in this area. However, we are pleased that the SBC has been given extra powers to tackle some of the defaulters under the old code. 

“Clearly this is voluntary but we will be asking UK businesses across the supply chain to look to see how they can sign up to this enhanced code and work together to eradicate the scourge of late payment.”