Tax & admin Fred Heritage · 9 October 2017
Late payments: Just two per cent of firms think small business commissioner will help
Only two per cent of micro business owners believe the government’s newly-appointed small business commissioner will be able to make a significant difference in tackling late payments. Just 100, 000 owners at micro companies the equivalent of around two per cent of the UK total believe that new commissioner Paul Uppal will be able to bring about a significant change in late payment culture, according to research from FreeAgent. It is believed that Uppal, the former Conservative MP who was appointed to the commissioner’s role on 3 October will, because of the size and scale of the problem for micro firms, struggle to tackle late payments despite this being the main purpose of the commissioner’s role and office. Analysing data from a sample of more than 50, 000 small business clients, FreeAgent discovered that roughly half of all invoices sent last year to business owners in the UK were paid on time. The same study asked micro business owners what measures theyd like in place in order to tackle late payments, with some 70 per cent claiming theyd like the opportunity to secure compensation from late-paying clients. Around 60 per cent of micro business owners would like to see a code of conduct around late payments put in place and adhered to, and 29 per cent of micro company founders thought that being able to name and shame late paying customers would help to tackle the culture. Commenting on the research, FreeAgent co-founder and CEO Ed Molyneux said: Micro businesses and their owners are acutely affected by late payments. Unlike bigger companies who can often wait to be paid, micro businesses need to get paid promptly to keep their business in the black. we need to see a complete cultural shift when it comes to paying invoices so that these types of smaller businesses are not put at risk. Further research published earlier this year by FreeAgent revealed that as many as 57 per cent of UK micro business owners had no idea about the small business commissioner, the purpose of the office or the fact that an appointment to the role had long been due.
ABOUT THE EXPERTFred Heritage
Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.