Stuart Gentle Publisher at Onrec

Contractor Umbrella News: Prompt Payment Code reforms welcomed by SMEs

With so many SMEs facing uncertainty during the pandemic, the overhaul of the Prompt Payment Code (PPC) should come as a much-needed lifeline.

Currently, there is £23.4 billion worth of late invoices owed to businesses across the UK, and with so many firms already dealing with financial difficulties, late payments will only add to a company’s worries.

The PPC reforms will see the time-frame for payment (from those firms that have signed the Code) halve to just 30 days.

Tania Bowers, Legal Counsel and Head of Public Policy at APSCo, said, “Small businesses are facing a difficult time at the moment and any measures to support these organisations is welcome news. Many have already faced challenges accessing payments from business interruption insurance polices with insurers turning down claims. While the Supreme Court has ruled in favour of small companies on this issue, it is just one of many financial pressures facing company owners in these difficult times.”

“For smaller organisations, late payments and difficulties accessing funds owed through insurance schemes could be the difference between surviving these difficult times and making some very difficult staffing and cost-cutting decisions. Now more than ever, the UK’s small businesses need support from not only the government, but also the businesses they act as crucial suppliers to.”

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