North West leaders have welcomed the Government鈥檚 crackdown on late payments 鈥 with Greater Manchester Chamber of Commerce urging businesses to embrace technology to help them get paid even more quickly.
The Prime Minister today launched the Government鈥檚 Small Business Plan, which includes a push to tackle late payments as well as improving access to finance.
Business Secretary Jonathan Reynolds, who launched the plan with Sir Keir Starmer on a visit to a co-working space in Swindon, said late payments were the 鈥渘umber one issue鈥 raised by small businesses.
Sir Keir said he had been shocked to learn 拢11bn was lost through late payments annually, with big businesses often paying late.
So upcoming legislation will introduce maximum payment terms of 60 days, while the small business commissioner will get new authority to fine large firms persistently paying suppliers late. They will be able to enforce a rule that businesses must pay their supplier within 30 days of receipt of a valid invoice, unless otherwise agreed.
Meanwhile the Prime Minister announced 拢4bn of financial support for SMES and start-ups, including 拢1bn for new firms, with 69,000 start-up loans and mentoring support over the next four years. The British Business Bank will have its financial capacity increased to 拢25.6 billion.
The Prime Minister said he wanted to make it easier for people to get finance for their business ideas. He heard from the owner of a salon business who told him she had faced 鈥渁stronomical鈥 interest rates when she had first opened and looked for a bank loan.
He said: 鈥(We鈥檙e) making sure people can access that more easily, more readily, don鈥檛 necessarily have to feel that they鈥檝e got to put their equity, their house on the line.鈥
Subrahmaniam Krishnan-Harihara, deputy director of research at Greater Manchester Chamber of Commerce, said: "The Government's new Small Business Plan, with its 'toughest crackdown on late payments in a generation', is a welcome and necessary move for SMEs. The proposals, including new fining powers for the Small Business Commissioner and a mandated 60-day payment term, are a crucial step towards improving cash flow and fostering business stability. The new 拢4bn financial support package is also a significant boost for start-ups and scale-up businesses.
"However, a crucial element for success will be the complementary role of technology. While these new proposals provide the legislative and punitive measures, modern technology offers a route to higher efficiency. The Government's broader push for digital adoption is key here. By leveraging cloud accounting platforms, e-invoicing and other automation tools, businesses can reduce the administrative burden and ensure faster payments.
鈥淭he ultimate impact of these new rules will therefore depend on a two-pronged approach: effective enforcement of the regulations and widespread adoption of the digital tools that make compliance easier.
"We should also see whether and how large firms adapt to these new rules and ensure compliance or adopt new tactics to navigate the regulations. The Small Business Plan is indeed crucial but it is the first step. It should not be regarded as the only lever to empower the 海角视频's many small businesses."
Liverpool City Region Mayor Steve Rotheram said: 鈥淪mall businesses are the lifeblood of local economies 鈥 and in the Liverpool City Region, they鈥檙e at the heart of what makes our communities tick. From corner shops and cafes to cutting-edge tech start-ups, they鈥檙e the ones creating jobs, training local people, and giving our high streets their buzz.
鈥淏ut late payments are a major headache, stalling growth and putting unnecessary pressure on businesses, many of whom are battling for survival. So it鈥檚 good to see the government stepping up with proper action to tackle it head-on.
"This plan sends a strong message: we鈥檙e on the side of small businesses. And as a region, we鈥檒l keep doing everything we can to make sure they have the tools, the backing, and the support they need to succeed."
