Govt backs off late pay laws

The Government this week backed away from legislation to tackle the increasing problem of late payment.

Although late payments in construction have hit an all time high (see page 3), it is pinning its hopes on achieving 'a change in business culture and hence shorter payment times.'

The measures are described in a wide-ranging White Paper, Competitiveness: Helping Business to Win, published on Tuesday.

The White Paper also looks at health and safety policy, private financing and training.

On health and safety, 94 regulations are to be dropped. But most existing safety law, including last year's unpopular 'six pack' of legislation from Europe, looks to have survived the review. Drastic health and safety deregulation - feared by safety campaigners - seems to have been avoided.

Although only 2% of bills are currently paid on time, the Government claims there is 'no clear mandate from the business community in favour of legislation.' It therefore plans to:

l require public companies to set out their payment policies in directors' reports;

l make court procedures for debt recovery simpler;

l provide more advice to small firms on credit management;

l review the scope of small claims procedures;

l develop a proposal for a British Standard for prompt payment.

Government departments are expected to give a lead and will be required to publicise their arrangements for handling complaints about late pay.

'If there has not been a significant improvement within the next two years we will review the case for legislation,' Small Firms Minister Lord Strathclyde said on Tuesday.

On training the White Paper outlines a new, fast-track apprenticeship scheme as part of a œ300 million boost for skills. This accelerated modern apprenticeship will be an 18-month scheme for 18-19-year-olds and is additional to the previously announced 'modern apprenticeships.'

The White Paper also promises a œ63 million package for small firms. This is designed to update the managerial, supervisory, and technical skills of 24,000 key employees in small firms.

In conjunction with the CBI, the DTI is launching a benchmarking exercise among 100 of the top British companies to identify best management practices.