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Labour will get tough on late-payment culture, says Chuka Umunna Labour will get tough on late-payment culture, says Chuka Umunna
(6 months later)
Labour's attempt to woo the small business vote stepped up a gear on Friday when the shadow business secretary Chuka Umunna raised the prospect of automatic sanctions for big companies that fail to pay their suppliers on time.Labour's attempt to woo the small business vote stepped up a gear on Friday when the shadow business secretary Chuka Umunna raised the prospect of automatic sanctions for big companies that fail to pay their suppliers on time.
Umunna said the UK's late-payment culture was "outrageous" and warned that a future Labour government would consider banning firms from public contracts under a tough new sanctions regime.Umunna said the UK's late-payment culture was "outrageous" and warned that a future Labour government would consider banning firms from public contracts under a tough new sanctions regime.
The shadow business secretary outlined action against late payment in a series of measures announced to the annual conference of the Federation of Small Businesses.The shadow business secretary outlined action against late payment in a series of measures announced to the annual conference of the Federation of Small Businesses.
"Too many small businesses are effectively bankrolling bigger businesses that refuse to pay them on time. This is outrageous," Umunna said."Too many small businesses are effectively bankrolling bigger businesses that refuse to pay them on time. This is outrageous," Umunna said.
"In government we legislated so that late payments can incur interest, and we established the prompt payment code. But I know how hard it can be to challenge your own customers."In government we legislated so that late payments can incur interest, and we established the prompt payment code. But I know how hard it can be to challenge your own customers.
"So, the next Labour government will expose those who pay late and we will seek to put in place a regime that will automatically trigger action against late payers, perhaps by preventing them winning public contracts and through reporting requirements on payment performance in their company accounts.""So, the next Labour government will expose those who pay late and we will seek to put in place a regime that will automatically trigger action against late payers, perhaps by preventing them winning public contracts and through reporting requirements on payment performance in their company accounts."
As part of its attempt to build bridges with small- and medium-sized businesses, Umunna said he would set up a US-style government agency to make sure the perspectives of SMEs were seen in Whitehall.As part of its attempt to build bridges with small- and medium-sized businesses, Umunna said he would set up a US-style government agency to make sure the perspectives of SMEs were seen in Whitehall.
In addition, he said a future Labour government would crack down on energy companies that "ripped off" small businesses, giving firms the same sort of protection as currently provided for domestic consumers. Energy suppliers would be banned from putting businesses on more expensive tariffs without their consent and firms that fell into arrears would have to be given time to pay.In addition, he said a future Labour government would crack down on energy companies that "ripped off" small businesses, giving firms the same sort of protection as currently provided for domestic consumers. Energy suppliers would be banned from putting businesses on more expensive tariffs without their consent and firms that fell into arrears would have to be given time to pay.
Umunna also announced that Camden council in London would be the pilot for a peer-to-peer lending scheme, under which local authorities would invest in businesses in their own area.Umunna also announced that Camden council in London would be the pilot for a peer-to-peer lending scheme, under which local authorities would invest in businesses in their own area.
"Our new approach to small business, which reflects the changing nature of small business, is why today I say I believe there is very strong case for the establishment of a small business agency, along the lines of the small business administration in the US," Umunna said. "I have met senior SBA officials several times and believe an equivalent agency could be set up here under the auspices of the business department to drive a small business agenda across the whole of government.""Our new approach to small business, which reflects the changing nature of small business, is why today I say I believe there is very strong case for the establishment of a small business agency, along the lines of the small business administration in the US," Umunna said. "I have met senior SBA officials several times and believe an equivalent agency could be set up here under the auspices of the business department to drive a small business agenda across the whole of government."
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