Late Payments
Debate between Lord Cope of Berkeley and Viscount Younger of Leckie
Viscount Younger of Leckie
This takes us into the territory of the sometimes complex ways of financing supply chains or projects. On project bank accounts—this is perhaps more focused on construction, but I hopes it helps answer the noble Lord’s question—the current policy is to use these types of accounts unless there are compelling reasons not to do so.
Lord Cope of Berkeley (Con)
My Lords, I agree with those who have said that this is a long-term problem; I was involved in it many years ago and have been since. I welcome the tougher approach signalled by these proposals, particularly the strengthening of the commissioner’s powers. But I am not quite clear—perhaps my noble friend could assist—as to the stronger attitude to compliance that will be taken. Is it just a stronger attitude to compel the disclosure of information and that side of it? That is fine, but is it the commissioner or the department that will potentially issue penalties for poor practice among large firms? Those are the ones that will really bite hard, but of course it means you have to define, in ways that will stand up in court, whether it is a poor payment practice.
Viscount Younger of Leckie
My noble friend makes a good point, to the extent that the idea behind the announcement today is to look at giving the commissioner more powers. As my noble friend will know, the commissioner has been operationally independent since December 2017, but at this stage it is sensible to assess and re-evaluate powers. The commissioner has recovered over £3.8 million for small businesses since 2017, so there is a head of steam up here. We will have to look carefully at what extra powers we give. To answer the noble Lord’s question, that could include issuing penalties, but we are not at that stage quite yet.