The difficult economic climate has had a significant impact on small businesses as is well known.
But one area that has so far received little attention is the increase in late payments.
The FSB (Federation of Small Businesses) has highlighted its effects in a report titled Time is Money: The Case for Late Payment Reform
It includes some stark figures as well as demands for tightening up both scrutiny and regulation of late payments.
While it is debatable whether the Chancellor will include any measures in tomorrow’s budget it is clear tougher action is needed.
FSB findings in the report included the fact that in 2022 on average 52% experienced late payment and 25% reported increased late payment. As a result 37% of applied for credit to manage their cashflow.
The report included proposals for the Government that included giving audit committees of large firms oversight of payment practices and reporting on progress in their annual report.
The FSB also wants the Government to commit to limiting the maximum payment terms to small suppliers in law by 2027 if the situation does not improve and to banning late payers from public procurement contracts.
It also wants the Small Business Commissioner to be given powers to investigate instances of poor payment practices proactively rather than waiting for a complaint to be made.
While there is little likelihood that any of this will be in Wednesday’s budget there has been very little by way of information about what it is likely to contain.
Small businesses will be looking for more help on their tax and energy bill burdens at the very least.