Partner Article

Private sector should learn from the Government on prompt payment

The National Audit Office (NAO) has published a report on government payment practices which found that the public sector pays in better time than the private sector.

Gordon Millward, Regional Chairman of the Federation of Small Businesses (FSB), said:

“Many in the private sector still have a lot to learn about paying bills in good time, and the Government has the opportunity to help teach them.

“This new report demonstrates the need to tighten up prompt payment practices right across the economy. Central Government has raised its game and is recognising the absolute priority of paying its suppliers on time, making it a requirement to pay within 30 days. It now needs to use this record to improve the wider payment culture, both in the rest of the public sector and in the private sector.

“It’s a scandal that thousands of businesses have gone under because of late payment, with numerous others struggling with their cashflow because of poor payment practices.

“To improve the payment culture, the FSB believes that being a signatory to the prompt payment code must become a prerequisite for supplying the Government. To encourage further a change in culture, Government Departments must also get better at making sure the benefits of their own prompt payment practices are passed all the way down the supply chain and don’t stop with the primary suppliers.”

This was posted in Bdaily's Members' News section by Federation of Small Businesses .