The Builders Merchants Federation (BMF) has called on the Government to tackle poor payment practices between businesses by enforcing the Late Payment Code.
Responding to the Department of Business Industry and Skills (BIS) consultation paper, “Building a Responsible Payment Culture”, which recognises that poor payment practices are endemic especially in construction, the BMF said late, incomplete or non-payment of bills is a long-standing issue faced by merchants that must be tackled.
BMF managing director, John Newcomb, said: “The trend by some builders and contractors to move to 120 days as a default position has to be confronted.
“The primary issue is adhering to agreed terms. Late means late, not extended. The secondary issue is whether a supplier wishes to – or is forced into – agree a longer settlement period than he wants. The Late Payment Code is an obvious first starting point, but while the Code remains voluntary, we doubt the majority of b2b payments will be made in less than 60 days.”
BMF policy manager, Brett Amphlett, added:”We recognise that ministers, like Vince Cable and Michael Fallon, want to solve this shameful practice and appear ready to ‘name & shame’ firms who are slow to pay. It cannot be right that firms whose default payment cycle is 60 days, or more, can sign this Code. It is called the Prompt Payment Code – not the Extended Payment Code.”