The new Prompt Payment Advisory Board will include representatives from the likes of Aviva, Barclays, Fujitsu and Skanska, business minister Matthew Hancock has revealed.
According to Hancock, the board will strengthen the Prompt Payment Code and ‘crack down’ on poor practice as well as highlighting when it is done well.
The decision to form the board follows a Department for Business, Innovation & Skills (BIS) discussion paper which called for a ‘more robust and active’ Prompt Payment Code.
‘Late payment continues to plague businesses, putting a strain on cash flow and preventing plans for growth,’ Hancock says.
‘We have committed to tackling this problem, but there is no silver bullet. This is about a change of culture, which needs businesses and government to work together.’
Set up in 2008, the Prompt Payment Code is administered by the Institute of Credit Management (ICM) on behalf of BIS and seeks to provide a set of principles committing businesses to paying on time and fairly.
In November 2012 it was announced that FTSE 100 and 250 companies which had failed to sign up to the code would be named and shamed. The government wants to see companies agree to payment terms before delivering orders and make use of Supply Chain Finance schemes.
Philip King, CEO of the ICM, comments, ‘The timing is now right for the code to be further strengthened and developed as a key tool in helping to tackle the scourge of late payment and driving a change in business culture from top to bottom.
‘The launch of a dedicated Prompt Payment Code Advisory Board is both a positive and exciting step. It will allow individuals to bring their expert advice to the table and identify further improvements to support the creation of an environment where paying on time is the norm rather than the exception.’
Also joining the board, which has already had its first meeting, are Bury council, City of London Corporation, Confederation of British Industries, Forum of Private Business, the Institute of Directors and Stort Chemicals.