Replace late payment with prompt payment

It takes moral courage to put your head above the parapet and place your name into the public domain on a ballot paper at elections.

And so it was a few weeks ago when 807 individuals put their names forward for 462 seats as NI went to the polls again to elect a slate of candidates for council positions in our local government elections.

It takes energy, hard work and perseverance to put yourself through an election, with absolutely no guarantee of success after putting what can be immense mental and physical effort into your endeavours.

You may agree or disagree with candidates, their parties or the views and policies they espouse, but this is an essential part of the democratic process where the people give elected representatives a mandate to deliver at local government level.

I congratulate all those who were elected and commiserate with those who were unsuccessful. Some political careers are only beginning, some will end and others will return in the future.

At FSB NI we engage with all parties across NI at all levels of government, whether that be Westminster, Assembly or council level. That is exactly what we did in the run up to this year`s local government election on the issue of late payment of invoices which is a big issue for many small businesses.

A quote about management that has often been used is ‘if you can`t measure it, you can`t manage it.’ The late payment of invoices by the public sector can be measured. FSB research established that in NI in 2021/2022 234,000 invoices were not paid on time inside the public sector legal requirement of 30 days, which includes councils.

That`s why FSB made the following asks at council level:

The appointment of Prompt Payment Champions – each council should nominate two people - one at staff director level and one an elected councillor. Their role would be to ensure prompt payment is a priority in each council and that targets are met.

Publication of data – councils should publish all their payment data in an accessible format and provide a commentary of their respective performance.

Payment on interest – councils should consider automatic payment of interest due on all invoices which are paid beyond the legal deadline of 30 days.

(You can read our full report ‘Never Better Late’ here)

Councils have the ability to deliver better services and outcomes locally for domestic and business ratepayers, through local leadership, knowledge, policy and ethos.

We will work constructively with all the newly elected councillors and council officials to help inform and shape council policy in a positive way for small businesses which make up 99% of all businesses in our economy.

The small business sector is larger than the public sector and the rest of the private sector put together. However late payment of invoices can have a disproportionate impact on many small businesses which are still recovering from the impact of the pandemic.

This matters because whereas big businesses can use their larger resources to mitigate and absorb the impact of late invoice payments, in the case of some small businesses, it has the potential to put the lights out. The late payment of invoices to SMEs across our economy is a cause of business stress and failure.

We believe that late payment of public sector invoices can be fixed at council level at no cost, but with huge benefit to local small business rates payers. It would be a win, win all round. FSB has called for late payment reform on a national scale across public and private sectors - but progress can also be made in NI alone.

We engaged with the political parties on this issue in the weeks and months leading up to the election as the authoritative voice of small businesses in NI, thousands of whom are FSB members. I am pleased to say that all those we spoke to recognise the importance of small businesses to the local economy.

This was acknowledged by parties through manifesto commitments on prompt payment and pledges of support to address this issue after the local government elections which have now taken place.

In the coming weeks we look forward to engaging with all the parties and newly elected councillors to help deliver solutions to late invoice payment.

We will be asking councils to replace ‘late payment’ with ‘prompt payment’. Working together I believe we can achieve that alongside other priorities.