- The UK government has unveiled its toughest crackdown on late payments to small businesses in over 25 years, aiming to prevent 1,000 monthly closures and an £11 billion annual economic cost.
- The reforms will grant enhanced powers to the Small Business Commissioner, enabling investigations into poor payment practices, dispute adjudication and the imposition of fines on persistent offenders.
- New measures include a 60-day cap on payment terms for all large firms when settling invoices with smaller suppliers, making these laws among the strongest in G7 nations.
- A mandatory interest rate of 8 per cent above the Bank of England base rate will be introduced for late payments, alongside compensation for affected businesses.
- The government also plans to ban the withholding of retention payments under construction contracts, a move welcomed by ministers and the Small Business Commissioner as "game-changing".
IN FULL
Government unveils ‘game-changing’ payment law reforms in bid to protect small businesses
