Late Payments
Debate between Viscount Younger of Leckie and Lord Cotter
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.
Lord Cotter (LD)
My Lords, I raise a point on an area I hope the Government are currently improving. In the past I was the managing director of a small plastic manufacturing company. We were very pleased to get business contracts and strove hard to get the contracts from the Government themselves. Will the Minister therefore look at the Government’s record currently? In the past, the pressure was on small firms to get the contracts but not always on ensuring the payments were made on time.
Viscount Younger of Leckie
Yes, a distinction should be made between private enterprise and public contracts. On the public contracts side, the noble Lord may know that, from 1 September, for contracts over £5 million, 95% of the invoices has to be paid within 60 days. The Government are very aware of their obligations on that side. I even have some figures for different government departments, but we will not go down that route just now.
Small and Medium-sized Enterprises: Late Payments
Debate between Viscount Younger of Leckie and Lord Cotter
Viscount Younger of Leckie
The noble Lord refers to the construction industry, concerning roofing, if I read him correctly. We welcome the principles announced by the Construction Leadership Council to end the unfair use of cash retentions. The use of retentions is, I am pleased to reassure the noble Lord, in decline, with many of the construction industry’s better clients no longer withholding payments. Indeed, the Government have committed to reduce their use on their own contracts.
Lord Cotter (LD)
Will the Minister consider very carefully the issue of retention for the construction industry and, specifically, the roofing industry? Will he also give a firm commitment that he will listen to the Federation of Small Businesses and the construction industry, because there are considerable problems still, with over 50% of small businesses waiting for payment? Would he have a constructive consultation, because there have been concerns about them, to ensure that there are tangible measures in this Bill on the payment charter, for example, to make it more mandatory?
Viscount Younger of Leckie
I hope that I can assure my noble friend that, in addition to introducing the new reporting requirement, we are looking at giving suppliers more information on what to expect from their customers and therefore to be in a better position to make an informed judgment on whether to enter a commercial relationship, and how to negotiate fair terms or challenge unfair terms, as well as how to understand what they need to do to ensure that they get paid on time.
Consumers: Vulnerable Consumers
Debate between Viscount Younger of Leckie and Lord Cotter
Viscount Younger of Leckie
I reassure the noble and learned Baroness that I am very much in listening mode and say again that some people will always genuinely want to receive bills and statements through the post. Companies certainly recognise that. The issue is that if that is the case and there is to be any change to contracts, I need to give them a decent amount of time under the legal protection to do that.
Lord Cotter (LD)
My Lords, the Minister has responded somewhat defensively on this issue. Could he please listen? We are talking about 7 million adults, largely elderly, and vulnerable and disabled people who cannot have access to the net, and many rural areas still do not have good broadband. These are very serious issues. Companies are pushing people in the wrong direction, for example, by renewing contracts over the internet. People are not aware of this and then learn, some months later, that money has been taken out of their accounts to renew a contract they did not know about. There are big issues involved.
Viscount Younger of Leckie
Again, I note the point made by my noble friend. It is worth pointing out that providing information only online could, in certain circumstances, amount to indirect discrimination unless it is a proportionate means of achieving a legitimate aim. Consumers have the choice not to access the internet, but that choice may mean paying for a paper copy.