The Government has given new small business commissioner Paul Uppal powers to help small firms resolve issues with late payment.
A new complaint handling service promises to "support Britain's 5.7 million small businesses to resolve payment disputes and tackle larger businesses' unfair payment practices to drive culture change".
Paul Uppal, small business commissioner, said: "My mission is to help all small businesses nurture positive and lasting relationships with their customers that work in the best interests of both."
The commissioner's website tells small businesses on how to "check, chase and choose":
- Check if the right information has been provided to the right people in order for an invoice to be paid;
- Chase effectively when a payment is overdue;
- Choose how to take further action, including the option of submitting a complaint to the small business commissioner.
According to Government figures, a third of payments to small businesses are late and 20% of small firms have had cashflow problems as a result. If small businesses were paid on time, it says, the economy could be boosted by an estimated £2.5 billion annually.
Mike Cherry, national chairman of the Federation of Small Businesses (FSB), said: "The UK is gripped by a poor payments crisis … the small business commissioner is crucial to turning the tide on this late payments culture. FSB will be encouraging small businesses affected to use the service, and we hope then to see clear actions taken to tackle the worst examples of supply chain bullying."
Jordan Marshall, policy development manager at IPSE, said: "For too long, late payment culture has been a blight on the self-employed. This is therefore definitely a big step in the right direction."
Ian Cass, managing director of the Forum of Private Business (FPB) said: "Late payment and unfair terms of trade forced onto small businesses by the high street giants frequently cause major cashflow problems for them. The Forum's Hall of Shame, showcasing those corporates demonstrating worst practice, has been in place for several years now, and this albeit overdue action to address the issue is very welcome."
The new complaints service is one of a number of measures the Government is taking to tackle late payment. Regulations came into force in April 2017 requiring large businesses to publically report the average time they take to pay their suppliers. Firms can check when large businesses pay their suppliers on the gov.uk website. So far, over 200 of the UK's largest businesses have submitted payment reports.