LONDON: UK companies will now be pushed to pay their suppliers within 30 days as part of the government’s plan to speed up the economy’s “payment culture”.
Tory business minister Matthew Hancock unveiled the revision to the voluntary Prompt Payment Code at the 2015 EEF National Manufacturing Conference.
The move will mean that businesses will be expected to pay their suppliers within 30 days as standard and a 60 day maximum limit will be introduced.
Hancock also explained that a new enforcement body will be established, which will be able to eject rogue companies from the register.
We must change UK payment culture. Unacceptable payment terms must stop. Why should long payment terms be deemed acceptable business practice here when they are not in many of our major competitors, like Germany?” the minister said.
From this week, all public sector contracts must by law pay on 30 days, and the 30 day terms must be cascaded down the supply chain.
