Government unveils plans to bring in regulations to force firms to disclose information on their payment performance
Big construction firms could be forced to publish data on their payment practices under proposals to improve payment across the industry unveiled by the government today.
In December 2013, the government issued a consultation on tackling late payment across the UK economy, today in its response to the consultation it said it intended to require large firms to publish information on their payment performance.
The announcement comes shortly after the government published the construction industry payment charter, in April. The charter, which was developed by the Construction Leadership Council, commits signatories to pay all suppliers within 30 days by January 2018.
Today’s announcement said: “We will work with businesses and business organisations to develop a new, robust reporting framework that has useful content and is structured in a way that is genuinely helpful to suppliers and customers.”
It also said that the reporting framework would be designed in such as a way as to minimise the additional cost to businesses.
The government said that half of the 70% of consultation respondents that felt greater reporting was a good idea said the reporting framework should be fully mandatory.
However, it only committed to enact laws to underpin a payment practice reporting framework “when Parliamentary time permits”.
Business secretary Vince Cable said: “For too long too many large companies have been getting away with not paying their suppliers on time to maximise their profits. It is small business that is suffering as a result and it needs to stop.
“The government has taken action to create a responsible payment culture but we need to go further. We will now make it compulsory for large companies to publish information about their payment practices so that those who are not playing fair can be held to account.”
It also said it would use the construction payment charter as a model for similar charters in other industries.