Late payments are a nightmare in the industry at the moment. Not only are tradespeople having to worry about whether their tools are being stolen while they sleep but also whether they’re even going to be paid for the job they’ve done. And, something needs to change!
And, for once, we can actually say that it is!
In fact, main contractors could soon face public work bans if they are found to be guilty of late payments. This means that if the big contractors fail to pay those in their supply chains, then they could be banned from public work.
The government aims to work with legit companies who pay their supply chains promptly and only want to work with these kinds of companies. The Cabinet Office Minister described: “Companies providing crucial services to the public sector, like delivering road infrastructure projects, must be paid on time.”
“Paying invoices promptly is vital in providing healthy cash flow.”
“Particularly for smaller businesses who are the backbone of the UK economy, to help them survive and thrive.”
“From next year, if government contractors are late with supplier payments, they could stop winning public contracts altogether – until they clean up their act.”
But what about the smaller companies?
As the Cabinet Office Minister said, smaller businesses are the backbone of the UK economy. And they need to be paid on time in order to help them continue to grow. So, this new rule could be life-changing for those impacted by these big companies.
But, unfortunately, it’s not just the major contractors that are either paying people late or not paying at all. Instead, it’s even happening with domestic customers. So, is more change needed? And more laws needed to stop this kind of thing from happening? Let us know what you think in the comments below.