Government enforces 30-day pay deal for subcontractors

Published on Friday 19 June 2009 21:06

COMPANIES working for the Scottish Government will have to pay their subcontractors within 30 days of being invoiced for work, the First Minister promised yesterday.

Alex Salmond told the Business in the Parliament conference in Edinburgh yesterday that a clause would be written into government contracts to enforce the payment terms.

News of the move, aimed at helping hard-pressed small businesses, came after it was revealed that the Scottish Government was paying 92 per cent of its invoices within ten days. However, payment times varied between departments, with the finance and corporate services office paying 94 per cent of invoices within ten days, but the office of the permanent secretary only paying 59 per cent of invoices inside the ten-day target.

Salmond yesterday said: "The effect of late payment on small businesses, particularly in the current economic climate, is completely unacceptable and must be stopped.

"The Scottish Government is leading by example and I would encourage all other organisations to follow suit."

The Federation of Small Businesses in Scotland said that ministers had listened to its members' requests for action on delayed payments.

Andy Willox, the FSB's Scottish policy convenor, said: "We are delighted the Scottish Government has listened to our concerns and is taking swift action."