Small Businesses: Late Payments

Lord Mendelsohn Excerpts

Wednesday 28th October 2015 Lords Chamber

[Baroness Neville-Rolfe]

My Lords, there are arrangements, particularly stemming from EU directives, about the payment of interest on late payments. The difficulty is that they are not always pushed, especially by smaller companies. We need to change the payment culture in this country, which is what the Small Business Commissioner is about and what the regulations that we will be bringing in early next year, bringing transparency to payment terms, are about as well. The small will know what the big are doing and whether they are up to scratch.

[Lord Mendelsohn (Lab)]

My Lords, the Enterprise Bill excludes the possibility of a complaint being resolved where a small business is in dispute with another small business as a result of a larger business’s unacceptable payment practices, especially where the small business caught in the middle is not protected from reprisals. Can the Minister tell us how much this exclusion reduces from the overall figure of late payments that the small business commissioner will be responsible for?

[Baroness Neville-Rolfe]

My Lords, we are trying to focus the work of the Small Business Commissioner when we set him up particularly on complaints from smaller businesses about bigger businesses. The noble Lord rightly says that there can be issues between small businesses in respect of payment. We are debating and looking at that but we plan to focus on the imbalance at the large/small end initially.