FPB pushes councils on late payment

The Forum of Private Business is chasing local authorities in England to clarify the time taken to pay suppliers.

A champion of small businesses, the organisation has submitted Freedom of Information Act requests to every council in the country.

The move comes three years after it last quizzed councils on the matter, when it discovered that businesses dealing with local authorities faced a "postcode lottery", with some councils paying in under the targeted 10 days, but many others taking almost double this time.

Senior policy adviser Phil McCabe said: "The real public sector late payment problem is where local authorities are concerned, where a great many contracts for small firms originate.

"According to our previous freedom of information research, there has been a real postcode lottery when it comes to suppliers being paid on time – it will be interesting to see if anything has improved or, given that we are again in recession and overall levels of late payment appear to be increasing, become worse.

"While the Government’s commitment to paying promptly centrally is welcome, it is important we also look to councils to set the standard for private companies to follow."

In the 2009 results, the average time local authorities took to pay invoices was almost double the 10-day target, at 19 days.

The UK average for the payment of bills within 10 days was 42%, but stark regional variations meant that this figure was as high as 52% in some areas and as low as 11% in others.