HC Deb 11 June 2002 vol 386 cc1158-9W
Mr. Lyons

To ask the Secretary of State for Trade and Industry what further measures she is taking to address the impact of late payments of invoices on small businesses. [59645]

Nigel Griffiths

We are ensuring that from 7 August 2002all businesses and public sector bodies can claim interest for late payment; creditors can claim a fixed sum of compensation to cover debt recovery costs if they have to chase up late payment; all businesses and public sector bodies can challenge contractual terms that do not provide a substantial remedy for late payment; SMEs are provided with the right to have appropriate organisations and a trade association act on their behalf and to challenge unfair contractual terms that try to remove or alter their right to statutory interest; and a simple reference rate will be created which will be set for six months and used to determine the late payment interest rate. (The late payment interest rate is the reference rate plus 8 per cent.) This will make it easier for firms to calculate the interest they may be owed.