New research into the UK’s so-called late payments crisis reveals that just over half (52 per cent) of invoices issued by small businesses and freelancers are paid on time.
The comprehensive study, which was carried out by cloud accounting provider FreeAgent, quizzed more than 50,000 freelancers and micro-businesses and analysed thousands of invoices.
It found that more than a quarter (26 per cent) of small firms and freelancers have been forced to wait between three and six months for invoices to be paid, while 10 per cent have encountered numerous clients who haven’t paid them at all.
As part of the survey, FreeAgent’s users were asked to suggest what measures they think should be introduced in order to tackle the UK’s worsening late payment woes.
More than half (59 per cent) of respondents said that they would like the Government to introduce an official ‘code of conduct’ for UK companies, stating clear payment terms which all UK firms would have to abide by.
A further 70 per cent added that they would like to see new legislation introduced which would entitle them to compensation in instances where invoices go unpaid.
The findings come at a time when the recently-appointed Small Business Commissioner, Paul Uppal, has been allocated an annual budget of £1.4 million to help tackle the late payments crisis.
In coming weeks, Mr Uppal will be travelling to Middlesbrough as part of the Government’s nationwide initiative to ‘drive a cultural change’ in payment practices.
The Commissioner has also identified the West Midlands, among other regions, as ‘areas of priority’.
“Through my role I aim to give small businesses the support they deserve, in particular to ensure fair payment practices, which are essential in helping them to thrive,” he said.