Reporting on Payment Practices and Performance Regulations

AAT has offered constructive criticism of the Payment Practices and Performance Regulations since inception, believing them to be a well-intentioned but ineffective policy response to the problem of late payments.

Transparency is greatly undermined by many companies who should be reporting their payment practices failing to do so.

There is a related issue around the reliability of the data. If the objective is to encourage small businesses to establish if they are working with a company that pays on time and/or in a reasonable timeframe, it is essential that such data is accurate and can be relied upon.

BEIS does not publish any statistics as to how many of the UK’s 5 million+ SMEs access the portal for information. Given the reluctance to make such information publicly available it is reasonable to assume that information is rarely being accessed by the intended audience. As AAT stated in 2018, the regulations provide policy makers with reams of additional information. However, in terms of transparency that benefits the majority of small businesses, it does not appear to have made any difference. Small business suppliers are not making informed decisions about who to trade with, negotiate fairer terms, and challenge late payments as a result of the regulations as most do not access the data, with many being unaware it even exists.

Furthermore, the problem of late payments has grown rather than decreased since the introduction of these regulations. This was already the case prior to the pandemic, although the pandemic has clearly exacerbated the problem.