§ Lord Harrisonasked Her Majesty's Government:
Whether the working of the Late Payments of Commercial Debts (Interest) Act 1998, which sought to tackle small and medium-sized enterprises being paid late, especially by big firms and institutions, is satisfactory. [HL4794]
§ Lord Sainsbury of TurvilleSince its introduction in November 1998, we have consistently monitored the effect of the Act on payment times in the UK. We recognise that we are still at an early stage and the UK still has some way to go before we meet the example set by countries such as Sweden and Denmark but we welcome the findings from recent research.
Research undertaken by the Credit Management Research Centre in October 1998, prior to the introduction of the legislation, reported that 45 per cent of customers were paying at or near the due date without being reminded. A more recent survey published in July 2000 shows that this figure has now 170WA risen to 60 per cent, identifying a reduction in the number of late payers in the UK since the introduction of the legislation.
In addition, recent research published in the Grant Thornton European Business Survey confirms that the average payment period for sales invoices in the UK now stands at 45 days against an EU average of 54 days, identifying a continuing downward trend in UK payment times in recent years.