IPSE welcomes clampdown on late payment

IPSE, the Association of Independent Professionals and the Self-Employed, has welcomed new government proposals to ‘end the problem of late payments to small businesses’.

IPSE research shows freelancers spend an average of 20 days a year chasing invoices for late payment. Almost half (43%) of freelancers have also done work they were never paid for. Among 18–34-year-olds, this rises to 58%.

The government has called for evidence on a number of proposals to clampdown on late payment. These include making big businesses appoint a non-executive director to ensure prompt payment, empowering trade bodies to highlight best and worst practice and promoting innovative technologies such as the latest accounting software.

Andy Chamberlain, IPSE’s deputy director of policy, commented: “For too long now, late payment has been a major problem for small businesses. It is the scourge of the self-employed, the UK’s smallest businesses. The government’s proposals to clamp down on it are very welcome to us, our members and all self-employed people across the UK.

“As IPSE research shows, the average freelancer spends 20 days a year chasing late payments. They also lose an average of £5,400 a year through unpaid work. These statistics are simply unacceptable for one of our most dynamic and productive economic sectors.

“IPSE led the charge by calling for a small business commissioner, and we were delighted when the government took heed and introduced the position. Greg Clark’s announcement this week that the small business commissioner, Paul Uppal, will be joining the Prompt Payment Code’s Compliance Board was also very welcome.

“It is good to see the government understands this is not yet enough, however, and is still looking for solutions. At IPSE, we believe the only way to truly turn poor payment culture around is to fine persistent offenders. In our evidence, we will be arguing the Small Business Commissioner should be given this power, and we will be working more closely with the government to end the scourge of late payment once and for all.”