We recently reported on a package of measures unveiled by Small Business Minister Kelly Tolhurst after last year’s call for evidence on tackling the problems of late payment (see Government promises to tackle scourge of late payment).

The Government’s proposals are contained in its response to Creating a responsible payment culture which can be found at https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/809997/prompt-payment-cfe-govt-response.pdf.

However, the plans have received a very lukewarm welcome by a leading trade association which said that, while it appreciates the Government’s commitment to put forward plans to crack down on late payment — nothing has changed.

The National Federation of Builders (NFB) argued that the proposals do little to improve the situation of construction companies on the ground and in the immediate future.

Chief Executive Richard Beresford said: “Despite changes to the Prompt Payment Code, 50,000 businesses fail every year because of late payment. Even the department for business admitted that payment times are getting longer. How many more businesses have to go under before we make late payment a thing of the past?”

Measures to strengthen the role of the Small Business Commissioner by giving him power to fine late payers and handing him greater responsibility over the Prompt Payment Code are certainly welcome, he went on, but they remain mere proposals.

His comments were reinforced by the NFB’s Chairman, Nick Sangwin, who said: “It’s time to do the right thing and kill off late payment, rather than kicking the can down the road once again. The announcement does not help small construction businesses who are about to go under because they are owed money. Nothing has changed for SMEs”.

Last reviewed 10 July 2019