New Fair Payment Code is seen as a step in the right direction
Government action on late payment has been welcomed by leading accountancy body ACCA. The announcement by Jonathan Reynolds, Secretary of State for Business and Trade, of a new Fair Payment Code to replace the Prompt Payment Code is the first step in the right direction.
Glenn Collins, Head of Technical and Strategic Engagement at ACCA, said: ‘We are pleased to see this move by the government today. ACCA has been a consistent and vocal supporter of the need to ensure small businesses are paid on time and have clear knowledge of the payment practices of who they are doing business with. It is a great first step but there will be more work to do. We look forward to participating in the consultation on the proposed new laws.
‘Late payment and unfair practices continues to blight small businesses across the UK. We have long called for urgent implementation of proposed improvements to tackle late payment problems, including expansion of prompt payment reporting and the proposed expansion of powers for the Small Business Commissioner (SBC). We are glad that some initiatives are now being taken.’
Gemma Gathercole, Strategic Engagement Lead, ACCA, added: ‘We will be calling for additional reforms to provide more transparency in this area. However, we are pleased that the SBC has been given extra powers to tackle some of the defaulters under the old code.
‘Clearly this is voluntary, but we will be asking UK businesses across the supply chain to look to see how they can sign up to this enhanced code and work together to eradicate the scourge of late payment.’
Based on the insight from members over the last two decades, ACCA is clear that late payment is a persistent problem in the UK. Poor payment practices have a domino effect throughout supply chains, with severe consequences for cashflow and the survival of SMEs. To rectify this situation, strong action - including a decisive culture shift – is required.
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About ACCA
We are ACCA (the Association of Chartered Certified Accountants), a globally recognised professional accountancy body providing qualifications and advancing standards in accountancy worldwide.
Founded in 1904 to widen access to the accountancy profession, we’ve long championed inclusion and today proudly support a diverse community of over 252,500 members and 526,000 future members in 180 countries.
Our forward-looking qualifications, continuous learning and insights are respected and valued by employers in every sector. They equip individuals with the business and finance expertise and ethical judgment to create, protect, and report the sustainable value delivered by organisations and economies.
Guided by our purpose and values, our ambition is to lead the accountancy profession for a changed world. Partnering with policymakers, standard setters, the donor community, educators and other accountancy bodies, we’re strengthening and building a profession that drives a sustainable future for all.
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