The Government has announced that it will be extending the Prompt Payment Code to help contractors and other sole traders cope with the horrors of late payment.
While Chancellor Osborne didn’t exactly go into detail how the Code will change on March 18th when he unveiled the Budget, in the days since the Government has gone on record with its intention of extending it further to help small business owners, sole traders and self-employed Brits by using supplier lists, legally obligating large firms to publish their payment histories in regards to timeliness and improving the transparency of its own payment practices in order to give the Prompt Payment Code some sharper teeth. Any firm that’s a signatory to the Code has a 60 day maximum when it comes to payment terms that they’ll have to abide by unless they want to face the tender ministrations of the Government.
Late payment of course has been a thorn in the side of sole traders, contractors and freelance workers for more or less the invention of money. It’s a constant pain in the arse and it’s exceedingly widespread, with the Federation of Small Businesses discovering in one of its countless research studies that 20 per cent of small firms have been victimised by larger companies when it comes to payment practices – and late payment is one of the chief ways these large firms take the piss out of their smaller brethren.
So is this new version of the Code going to make much of a difference? Well for what it’s worth it can’t make things much worse. Only around 21 per cent of FSB members thought the Prompt Payment Code actually worked well as it stood before the announced change, so I suppose there’s room for improvement there. Of course with confidence so low there’s really no other way to go but up is there?
Honestly I can’t say I’m surprised that things have gotten so bad that the Prompt Payment Code has had to have been given an update. Large firms are the closest thing you can get to evil incarnate without drawing an esoteric sigil in blood and chanting Satanic hymns in the ruins of a burned-down church on Halloween Eve in order to summon demons from Hell, after all.