Prompt Payment: 15th March 2016

Debbie Abrahams (Oldham East and Saddleworth) (Lab)
7. What steps his Department is taking to help small businesses receive prompt payment from their customers. [904092]

The Minister for Small Business, Industry and Enterprise (Anna Soubry)
Of course, we know that for small businesses late payment is a serious problem and continues to be so. That is why we are creating the small business commissioner, whose fundamental guiding principle will be to tackle this problem, because we want to change the culture. It is good to see that some of the larger companies have already changed their late payment policies quite significantly in favour of smaller businesses, in some instances reducing the period to 14 days, especially for micro-businesses. From October, larger companies will be under a duty to report their payment policies.

Debbie Abrahams
We welcome the creation of a small business commissioner as part of the Enterprise Bill, but given that last year’s National Audit Office report showed that four Departments were failing to meet the Government’s payment deadlines, why were public sector contracts not included?

Anna Soubry
I have particularly asked that we have a full look at how we ensure that in all Government contracts, at all levels, late payment is not a problem and that sub-contractors, in particular, do not breach our very clear rules about late payment and the terms and conditions that it is only right and fair to have in all contracts, particularly Government ones. It is not enough to say it; they should be doing it as well.