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Small Businesses Should Be Paid On Time

Michael Connarty (Linlithgow and East Falkirk) (Lab): I have been raising the issue of small businesses’ failure to be paid by large contractors. The Minister of State, Department for Business, Innovation and Skills, the hon. Member for Hertford and Stortford (Mr Prisk) was good enough to write to me, but he said that more than 50% of the problem occurred because there continued to be a problem with effective customer management on the part of the supplier. In other words, the large companies were to be managed by the small company. Is it not time that we actually did what the Electrical Contractors Association has called for and make it compulsory for 30 days’ payment to be in every single contract for a small supplier?

Mr Prisk: In fact, the Labour party tried to do that at the very beginning—in 1998, I believe—and failed. What we are doing is using our procurement powers to make sure that government sets the standard. I think that that is the best way, but I am always happy to look at unreasonable behaviour by large corporations and I would be happy to look at any further details that the hon. Gentleman can provide.

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