In this old article, Walsh Taylor reviewed some research that found that late payments were having an extremely detrimental impact on the UK construction sector.
After witnessing a 30% year-on-year rise in the number of firms that reported they are either close to liquidation or bankruptcy or in danger of being so soon, 73% of businesses said that as a supplier they have been paid past the often-mooted 45-day timeframe.
Near the beginning of last month the Leeds, Harrogate, Bradford and Darlington-based teams here at Walsh Taylor were therefore delighted to hear about some new government measures that aim to minimise the late payments problem.
Looking to target the larger organisations, Small Business Minister Kelly Tolhurst’s new proposals feature the following:
- A call for evidence to consider the best way that boards can implement responsible payment practices throughout their entire supply chain. Giving a non-executive director specific responsibilities for their prompt payment performance would be an example of this.
- Endorsing innovative technologies, which may include the latest accounting software, to help small firms manage payments procedures. This should also empower trade bodies to bring attention to the best and worst practices in payment behaviour.
It is clear to see why the government is active decisively on these issues. According to the Federation of Small Businesses, better policing of late payments could result in a huge £2.5 billion being added to the nation’s economy.
With almost a quarter of UK companies apparently stating that late payments are a threat to their survival, the insolvency specialists at Walsh Taylor know only too well the impact that they can have on businesses across Yorkshire and the North East.
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