Large businesses penalised for late payments
Several large companies have been suspended from the prompt payment code for failing to pay suppliers on time, the Chartered Institute of Credit management has announced.
The prompt payment code sets out a standard for payment practices, requiring businesses that sign up to pay suppliers on time, give them clear guidance, and encourage good practice.
They must also make a commitment to pay 95% of all their supplier invoices within 60 days.
In the last three months, 18 companies including BT, British American Tobacco and Centrica have been suspended from the code for failing to meet this commitment, and have been invited to produce an action plan to improve their performance.
Once they can demonstrate their compliance, they are reinstated to the code.
Small business commissioner Paul Uppal said the large companies who aren't meeting code standards "need to note their unethical payment practices will not be tolerated".
Andy Chamberlin, deputy director of policy at the Association of Independent Professionals and the Self-Employed, said late payment is "endemic" across British industry.
"Freelancers regularly tell me about the real damage this causes to their businesses and lives, with 20 days on average wasted a year chasing, leading to missed rent payments and even bankruptcy.
"The government must keep its promises and quickly push ahead with its proposed action to end late payment."
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