Prompt Payment for Small Firms: A Global Partnership.

On Tuesday June 16th we were at University of Warwick – Warwick Business School campus at The Shard co-hosting a workshop with the Office of the Small Business Commissioner and Department for Business and Trade: Prompt Payment for Small Firms: A Global Partnership.

The session brought together a great group of experts, researchers and policymakers to explore how we can accelerate prompt payment for SMEs in the UK and globally. After an introduction by UK Small Business Commissioner Emma Jones and ERC Director Stephen Roper, Paul Drabwell gave an update on recent and upcoming policy developments in the late payment challenge in the UK. And there is a lot to report – the government has recently announced major reforms in this area – the biggest in over 25 years, with much stronger powers for the The Small Business Commissioner.

Mark Hart presented some new ERC research carried out with Research Fellow Rita Nana-Cheraa, exploring global solutions to the late payment crisis. This research has involved a comprehensive, cross-country analysis of late payment frameworks across G7 economies, EU member states and key UK trading partners and competitors. The report explores key drivers of late payment and assesses the effectiveness of different policy approaches, highlighting countries and sectors where payment reform is more advanced. The presentation highlighted for example Japan’s proactive enforcement system, France’s use of administrative penalties, and The Netherlands’ SME-focused payment caps. A useful discussion followed focusing on workable approaches for the UK and globally.

A panel discussion followed focusing on how international alignment of payment practices can be achieved across cross different markets, with Ryland Atwood of Barclays, Glenn Collins of the ACCA, Jennifer Van Atta, MBA of Intuit, Ralph Rogge of Crezco, Veronique Willems of SMEunited, and Sangho Chae of WBS – who’s research has explored measuring the financial costs of late payment from a different angle – namely the loss in market value experienced by the large firms responsible.

We were then very pleased to be joined by the UK’s Small Business Minister, Blair McDougall. Minister McDougall shared his reflections on the role of late payment reform in the UK’s Small Business Plan, emphasising how current poor practice is holding back economic growth.

Emma Jones and Mark Hart rounded off the event by reflecting on the challenges ahead. They emphasised that working in partnership, we can make the changes that are so badly needed to systems and business culture and make the payment landscape much fairer for SMEs.

The ERC will reflect on the discussions and integrate these into the final version of the research report.

Watch this space for a new extended SOTA Review published soon!