Oral Answers to Questions

Alex Cunningham Excerpts

Thursday 6th March 2014 Commons Chamber

[Vince Cable]

I thought that the Labour party was still committed to supporting the national minimum wage. This is an interesting new evolution of policy, which seems to have been made on the stump. The naming and shaming policy has now come into effect and the first five companies were named at the end of last week.

[Alex Cunningham (Stockton North) (Lab)]

5. What recent representations he has received from small businesses on their consumer rights.

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jenny Willott)]

The Government have previously considered the case for small businesses to have rights when buying goods and services that are more aligned with consumers, and consulted on this question in 2008 and 2012. We have continued to engage with representatives of small business on this matter. The Federation of Small Businesses will shortly present a report in this area and I have committed to responding and will read it with interest.

[Alex Cunningham]

I had a visit from the North East Federation of Small Businesses on Friday and was told that it has seen longer and longer delays in getting larger organisations to pay for goods and services, with one—Procter & Gamble—now having payment terms of 180 days. It says the prompt payment code has no teeth and companies just extend their terms to comply. Is it not time for the Government to intervene to put an end to these disgraceful delays and give small organisations a better chance of survival?

[Jenny Willott]

The hon. Gentleman raises an important point, and the Government take concerns from business about unfair payment terms very seriously. For example, as he says, receiving payments promptly can be critical to the survival of a small business. That is why the Department launched a discussion paper called “Building a responsible payment culture” at the beginning of December. It sought views on what unfair payment terms look like and whether legislative or non-legislative measures should be used to tackle them. The consultation closed at the end of January and we are currently analysing the responses. We will announce shortly what we want to do to tackle the issue.