- 5 pay more than 50% late and 73 do not measure late payment.
- Local Authority Trading Companies demonstrate far worse payment performance. For example, Norfolk County Council reports paying 96% of invoices within 30 days, but their LATC (Norse Group) reports 46% of invoices paid late; Cornwall Council reports only 1% late payment of invoices, but their LATC (Cormac Solutions) reports 83% of invoices paid late.
Campaigning organisation Good Business Pays today reveals how long 384 UK Local Authorities are taking to pay their suppliers, ahead of the publishing of the new Public Sector Procurement Bill due to be introduced next year.
Good Business Pays is calling for:
- Greater transparency around how long Local Authorities take to pay their suppliers through the supply chain.
- A commitment from Local Authorities to support local economies and sustainable growth through meeting standards in payment performance.
- Ensure all Local Authority Trading Companies (LATC) avoid demonstrably poor payment performance with negative impact on local economies.
Some key findings from the research are:
- Of the 384 who reported, 241 pay in under 30 days and 72 pay in 10 days or less.
- Some still struggle with late payment, with over 90 Local Authorities paying more than 10% of invoices late, 5 paying more than 50% late and 73 who do not measure late payment.
- LATC’s (Local Authority Trading Companies) reduce transparency and may cloud poor payment performance. For example, Norfolk County Council reports paying 96% of invoices within 30 days, but their LATC (Norse Group) reports 46% of invoices paid late; Cornwall Council reports only 1% late payment of invoices, but their LATC (Cormac Solutions) reports 83% of invoices paid late.
- There was no single definition of ‘when the clock starts’ in terms of measuring time to pay.
- Some Local Authorities measure and communicate payment performance and others don’t. 36 Local Authorities could provide no data and 20 ignored the FOI request.
The five fastest-paying Local Authorities are set out in the table below:
|The average number of days taken to make payments to suppliers||% of invoices paid in 30 days||% of invoices paid late|
|London Borough of Bexley||1||100||0|
|Gravesham Borough Council||4||100||0|
|Mid Sussex District Council||4||100||0|
|Barnsley Metropolitan Borough Council||7||100||0|
|Hyndburn Borough Council||7||100||0|
The research findings and payment performance figures for all Local Authortities, along with the ability for businesses to provide feedback can be found here: Local Authority Payments – Good Business Pays.
Terry Corby, Founder & CEO of Good Business Pays said of the findings:
“It’s disappointing to see over 90 Local Authorities paying their suppliers late, and shocking to see LATC late payment figures being far worse. These figures are against the trend towards positive payment behaviours with 72 Local Authorities paying within 10 days.
“Prompt payment is important for Local Authorities, specifically in terms of delivering value and supporting local economies, establishing standards for businesses and overall being part of the Local Authority commitment to economic growth. Our research reveals red flags around the reliability of payment performance data. Given the key role Local Authorities play in spending public funds and levelling-up, as well as the up-coming changes to make it easier for small businesses to deliver work for the public sector, there should be greater transparency around how each Local Authority is delivering on their commitment.”
Good Business Pays carried out the research between April-June 2023, through an FOI request for payment data covering the period June 2022 to January 2023.