Government suppliers sign up to Whitehall prompt payment pledge

Written by Richard Johnstone on 5 July 2017 in News
News

Firms representing 40% of central government procurement spending agree to quicken payments to tackle £26bn backlog

Some of the biggest suppliers to government, including firms such as Atos, Capita and G4S, have backed a government pledge to pay suppliers within 30 days.

A total of 32 suppliers to Whitehall have today voluntarily committed to the Prompt Payment Code, which requires firms to pay 95% of invoices within 60 days and move towards adopting 30 days as the norm.


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According to government figures, small and medium-sized enterprises in the UK are collectively owed more than £26bn in overdue payments. It is an issue that Margaret Hodge, when chair of the Public Accounts Committee, called on the governemnt to do more to tackle.

Suppliers to government are encouraged by the Crown Commercial Service to agree to the code, which has been in place since 2008 and is currently administered by the Chartered Institute for Credit Management on behalf of the Department for Business, Energy and Industrial Strategy.

As well as pledging to pay suppliers within 30 days, signatories also promise to give suppliers clear guidance on payment and to put in place a system for dealing with disputes, as well as encouraging good practice.

The firms signing up, which also include major IT firms Fujitsu, Hewlett-Packard, IBM and Microsoft, account for around 40% of government procurement spend.

Cabinet Office minister Caroline Nokes said today’s agreements represented “a major boost to payment practices in the UK”.

“Paying invoices on time is vital in providing healthy cash flow to smaller businesses, to help them survive and thrive,” she said.

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Richard Johnstone is CSW's deputy and online editor and tweets as @CSW_DepEd

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