Nearly a quarter of businesses in the UK say that late payments threaten their survival. Tackling them provides a huge opportunity for economic growth, with research by the Federation of Small Businesses suggesting it could add £2.5 billion to the UK economy and keep an additional 50,000 businesses open each year. (1)
New Government policy, starting September 2019, means that large companies paying less than 95% of invoices within 60 days risk being excluded from bidding on government contracts.
Exclusive analysis by Tussell on the potential impact of these new measures reveals the risks and opportunities that it could bring to the market. Read on for the key findings or download the full report to learn more.
In general, we've found that compliance with the new policy amongst suppliers to government is poor. While this brings risks to many companies, who could potentially be excluded from bidding on government contracts from September, it also brings opportunities to others, who could increase their market share.
- £90bn on contracts deemed to be 'in-scope', i.e. having a value of £5m or more, have been awarded to suppliers with poor payment practices since 2015.
- Under the new standard, 80% of the government's Strategic Suppliers would be excluded from bidding on government contracts
- The MoD has awarded 59 contracts to suppliers with poor payment practices since 2015 - more than double the number of the next buyer
- 41 contracts with non-compliant suppliers are due to expire in Q4 2019 - meaning potential opportunities for suppliers who are paying their suppliers on time
The full report outlines the government's new policy in detail, assesses the payment performance of the Strategic Suppliers - many of whom are at risk from this policy - and identifies which buyers have awarded the most contracts to non-compliant suppliers. Enter your details below to download it.