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• Proposals include measures to empower trade bodies to highlight best and worst practices in payment behaviour in order to deliver practical improvements
• Part of the modern Industrial Strategy, helping our small businesses deliver growth and jobs

New measures to end the problem of late payments to small businesses by large companies who abuse their position in the market have been unveiled today (4 October 2018) by the Small Business Minister Kelly Tolhurst as she launches a call for evidence.

Nearly a quarter of UK businesses report that late payments are a threat to their survival. Tackling them represents a huge opportunity for economic growth, with research from the Federation of Small Businesses suggesting it could add £2.5 billion to the UK economy and keep an extra 50,000 businesses open each year.

The new proposals, building on action government has already taken to improve access to finance and the appointment of the Small Business Commissioner, include:

• the call for evidence to consider the best way company boards can put in place responsible payment practices throughout their supply chain, for example giving a non-executive director specific responsibilities for the company’s prompt payment performance
• promoting innovative technologies, such as the latest accounting software, to help small firms manage their payments processes, and empowering trade bodies to highlight the best and worst practices in payment behaviour

Small Business Minister Kelly Tolhurst said:

Our 5.7 million small businesses are the backbone of our economy, and ensuring we remain one of the best places in Europe to start and grow a small business is a key part of our modern Industrial Strategy.

Over the past 5 years the amount owed to businesses in late payments has halved, but we will go further to make sure all of our small businesses are treated fairly.

Today’s new call for evidence will help us identify the most effective way possible to tackle this issue once and for all and ensure small businesses are on a level playing field with their larger counterparts.

Federation of Small Businesses (FSB) National Chairman Mike Cherry said:

Late payment is the biggest challenge affecting small businesses and it is good to see the government getting serious about this issue, especially when it comes to large firms paying their supply chains promptly.

The voluntary Prompt Payment Code is not working when it allows signatories like Carillion to pay on terms of over 120 days, so we want to see a new tough and transparent compliance regime being proposed.

Involving the Small Business Commissioner Paul Uppal with the Code is also right as it shows a more joined-up approach to this difficult issue. Further, it is a positive step that central government will set an example – paying 90% of undisputed invoices from small and medium-sized businesses within five days.

The publication of the new call for evidence follows an announcement by the Business Secretary Greg Clark earlier this week where he set out other new measures to support small businesses, including:

• the Small Business Commissioner to join the Prompt Payment Code’s Compliance Board to support his role in tackling late payment
• the Board to consider all complaints made about compliance as part of regular reviews, and report on all cases of signatories being removed from the Code
• further reform to the Code to be considered including whether the Small Business Commissioner should have a greater role in its administration

Small Business Commissioner Paul Uppal said:

I welcome the opportunity to join the Prompt Payment Code’s Compliance Board. I am looking forward to working with the Prompt Payment Code Administration Team and improving current processes to ensure timely payments, which will encourage growth and productivity for SMEs across the UK.

The government has also set the ambition that all its departments commit to paying 90% of undisputed invoices from SMEs within 5 days and ensure all government departments have a dedicated non-executive director responsible for prompt payment, improving payment practices and exploring how better to use technology to make payment processes more efficient.

Some large businesses use late payments and extended payment terms to exert control over small businesses in their supply chain, and the government will now seek the views of the UK business community on how best to ensure small businesses are given a fair deal.

Cabinet Office Minister for Implementation Oliver Dowden said:

We expect the highest payment standards from both government and big business.

That is why we will commit to central government aiming to pay 90% of undisputed invoices from small and medium sized businesses within five days. Small firms can also report poor payment practices via our Mystery Shopper service, which ensures their voices are heard.

We are listening to businesses and doing more than ever to level the playing field for small businesses to win work in the public sector.

Emma Jones, MBE, founder of Enterprise Nation, said:

We’re delighted the government has taken this step to ensure they are setting the right example in paying within five days and further enforcing the prompt payment of invoices for SMEs.

There is absolutely no doubt that late payment, often 60 days and even beyond, has a dramatic and disproportionate effect on smaller firms, which often rely on cashflow to fund trade and avoid unnecessary debt. The continued attention on the issue of late payment should enable UK enterprise to further flourish.

The Call for Evidence launched today forms part of the government’s modern Industrial Strategy, which is committed to creating a fair and just business environment and ensuring Britain is one of the best places to start and run a small business.

It will be open until 29 November 2018 and the government is encouraging, businesses, trade associations and other interested parties such as academics to contribute their views to it.

Notes to editors:

The Call for Evidence will be available from 9:30am on 4 October 2018.

Late payment occurs when a business has been supplied goods or services on credit but fails to pay within the agreed term. Legally, if no explicit payment terms have been agreed, payment is assumed to be due after 30 days for the purposes of charging statutory interest.

Enterprise Nation is a small business support network that represents the views of thousands of UK small businesses.

The North East’s Flood Community Engagement officer Anna Caygill will be working with schools, businesses and communities in the town and surrounding areas to prepare for severe weather.

And she is kick-starting the project by hosting an event called ‘Flooding in a changing climate’ which will look at the impact of changing weather patterns and how this will affect the community.

• It takes place on Thursday 25 October between 11am and 3pm at Cornerstones Community Centre, North Burns.

Chester-le-Street has a recent flood history with over 900 properties at risk of flooding from surface water, and from the River Wear and Cong Burn.

Flooding on 28 June 2012 caused widespread damage and disruption – but the flood history of the town dates right back as far as the great flood of 1771.

Engagement complements flood scheme

Anna is building on previous work by Durham County Council’s Civil Contingency Unit and working with the community to develop a Community Flood Plan and recruit more volunteer Flood Wardens – who are the eyes and ears of the community during a flood event. Anna said:

I’m working closely with Durham County Council and the town’s Flood Wardens to ensure residents in the area are prepared for flooding.

The engagement complements the flood scheme currently being carried out by the council at the Market Place to reduce flood risk from the Cong Burn, as well as ongoing environmental work being done by Wear Rivers Trust.

We really want people to understand their flood risk and know what steps they can take to ensure they are prepared in the event of a flood, such as making sure they are signed up to receive free flood warnings and having a flood plan which is easy to follow.

Residents can find out if they live in an area at risk of flooding and sign up to receive free flood warnings by visiting here

For more information about the upcoming event contact Anna.Caygill@environment-agency.gov.uk

While most employers act in good faith, in some sectors evidence points towards poor tipping practices, including excessive deductions being made from tips left by customers.

New legislation, to be introduced at the earliest opportunity, will set out that tips must go to the workers providing the service.

Unemployment is at its lowest since the 1970’s and wages are rising. This legislation will ensure workers get the tips they deserve and give consumers reassurance that the money they leave in good faith to reward good service is going to the staff, as they intended – ensuring that hard work is rewarded.

With British Food Fortnight well underway, an iconic Northern cocoa house, a producer of fine cheeses and a world-leading agri-tech firm have become the newest members of the Northern Powerhouse Partners Programme.

Nearing almost 200 members from Northern-based multinationals to plucky start-ups, the Northern Powerhouse Partners Programme is a coalition of businesses who strongly believe in the economic potential of the North and support the need for a combined effort by government and business to realise that full potential.

The 3 newest members are:

Cocogreen UK Ltd: With headquarters in Manchester, Cocogreen are the world’s largest bulk processor of coconut husks and world-leader in agricultural manufacturing, research and sustainable innovation. Their work around edible crops has helped to decrease the region’s reliance on food imports whilst extending production season in berries and fresh salads.

Cows and Co. Group: As a group of artisan cheese producers, farmers and entrepreneurs passionate about developing a brand of high-quality premium food and drink products, Cows and Co. are well placed to be one of the champions for cheese and dairy products proudly produced in the Northern Powerhouse. With dairies across the North, including Appleby in Cumbria, their prime focus is to add value to the rural economy, through investing in premium food and drink, sustainable energy and consulting.

York Cocoa House: Based in York, the chocolate emporium and café York Cocoa House is dedicated to celebrating the chocolate heritage, industry and innovation that York was once famous for. The business has recently embarked on a campaign to bring manufacturing back to the city and are even exploring the new lines of chocolate bars proudly designed and made in the Northern Powerhouse.

Northern Powerhouse Minister Jake Berry MP said:

From a Cumbrian creamery to crop developers in the heart of Lancashire, food manufacturers and innovators across the North are joining our Northern Powerhouse Partners Programme just in time for British Food Fortnight.

We’re seeing one of the greatest coalitions of private and public sector partners ever assembled all coming together to work for the benefit of a strong and resilient Northern Powerhouse economy that is fit for the future.

Thomas Ogden, Group Commercial Director of Cocogreen said:

Cocogreen are really excited to have joined the Northern Powerhouse Partners Programme. We’re a Queen’s Award-winning enterprise and a finalist in the Lloyds Business Awards for Export with operations across the world but a heart firmly located in Manchester where our Directors met and started Cocogreen. We’re a growing business and have ambitious plans to address key challenges within the food sector including sustainability.

We’re innovators in the world of biotechnology and food production and are proud of our business’s work in decreasing reliance on food imports and increasing the production season of fresh produce within berries and fresh salad.

Stuart Maclennan, Director of Cows and Co said:

Appleby Creameries is delighted to join the Northern Powerhouse Partners programme. As an artisan food business, we are committed to championing all the great foods the North has to offer such as our award-winning cheeses.

We are focussed on building an export strategy in order to expand into the premium export markets which we see as being of great value particularly for the agri-food sector. We believe by building local, northern brands both locally and oversees, rural regions such as Westmorland in Cumbria can really put themselves on the global map as part of the Northern Powerhouse.

Sophie Jewett, Managing Director of York Cocoa House said:

We’re dedicated to celebrating the chocolate heritage, industry and innovation that York was once famous for. As part of this, York Cocoa House has recently embarked on a campaign to bring manufacturing back to the city by opening York Cocoa Works, a chocolate manufacturing, education and innovation facility based in the centre of York.

We’re the UK lead for the International Chocolate Awards as well as being an advocate for sustainable sourcing in the cocoa supply chain and are looking forward to becoming more involved in the Northern Powerhouse activity through the Partners Programme.

British Food Fortnight is a campaign run by Love British Food who are partners of the Department for International Trade’s The Great British Food Campaign.

Businesses based in the North who would like to shine a spotlight on their contribution to the Northern Powerhouse during British Food Fortnight should tag @NPHinfo on Twitter and remember to use #BritishFoodFortnight and #FoodisGREAT in their tweets.

Further information

The Northern Powerhouse is government’s vision for a super-connected, globally-competitive northern economy with a flourishing private sector, a highly-skilled population, and world-renowned civic and business leadership.

The Northern Powerhouse Partners Programme is an important part of creating the Northern Powerhouse.

Government is building a network of partners who all believe strongly in the economic potential of the North and support the need for a combined effort by government and business to realise that potential. Nearly 200 businesses and organisations have signed up to the partner programme.

Prospective partners can email NorthernPowerhouse@communities.gov.uk for more information about the Partner Programme and how to apply.

British Food Fortnight was founded in 2002 and is now considered to be one of the biggest national celebrations of British food. It has proven to be an important influencer in engaging the retail, catering, education and voluntary sectors in establishing a more robust market for Britain’s food. Find out more at www.lovebritishfood.co.uk.