The CBI engaged members large and small as part of a balanced, progressive position on improving business payment practices to government, to support strong supply chain relationships at an especially challenging time for the economy.
The Department for Business, Energy and Industrial Strategy (BEIS) has published reforms to the Prompt Payment Code, with a headline change that means, from July 2021, all Code signatories will need to pay invoices from small businesses (50 employees or fewer) within 30 days.
Since the Prompt Payment Code’s introduction in 2008, signatories to the voluntary Code have until this year been required to pay 95% of invoices within 60 days, with a commitment to working towards 30-day payment terms. Now, the reforms will require all Code signatories, regardless of their size, to pay 95% of invoices from small businesses within 30 days. This is alongside the continued overall commitment to pay 95% of all invoices in 60 days.
The Prompt Payment Code has been criticised in the past for lacking the means to compel Code signatories to improve their practices. Small businesses supplying to some Code’s signatories would report consistently receiving p