G4S being investigated.

24/5/2019.

The Late payment watchdog criticises G4S.

Leading outsourcing group G4S has been accused by the small business commissioner of “persistent late payment” towards one of its suppliers and its payment practices are being investigated.

G4S’s place on the prompt payment code, a voluntary scheme under which large businesses promise to treat suppliers fairly, is being urgently reviewed as a result of Paul Uppal’s intervention.

What happened?

The commissioner’s criticism stems from a complaint made by a G4S supplier regarding an overdue payment settled earlier this year.

The report highlights poor payment practices exercised by G4S against a small business supplier. The small business submitted an invoice for £31,880.49 on 7 October 2018 based on contractually agreed 60-day payment terms, according to the report.

The payment however was not made on the due date. “G4S confirmed that the invoice had been approved however, could not provide confirmation of a payment date”.

What they said

The small business commissioner, Paul Uppal said “G4S is the largest outsourcing company in the UK and as a strategic government supplier they have a responsibility to lead by example and demonstrate timely payment practices to ensure small businesses are not left disadvantaged.”

He also recommended that G4S  “offer all small businesses 30-day standard payment terms in line with the Government’s commitment for strategic suppliers to pay promptly.”

G4S maintains that the delayed payment was a “one-off,” resulting from a mistake in the supplier’s registration. Steve Poole, G4S Head of Transactional Services, responded “G4S has over 5,000 suppliers in the UK and receives 250,000 invoices a year. We are committed to honouring the payment terms as agreed with our suppliers. We have also made significant investment in our payment software, staff training and ticketing systems to ensure our suppliers are paid promptly.”

The spokesperson affirmed that the firm takes “late payment of invoices seriously,” adding: “We are working hard to make sure this becomes a rarity.” 

 

The Small Business Commissioner however noted in its report that the incident under scrutiny highlighted that G4S has “further steps to take” to ensure they are consistently compliant in paying promptly.

 

Mr. Uppal added that he hoped the public report would “serve as a deterrent  to other TIER 1 entities making similar omissions and encourage large business to adopt a responsible payment culture within their supply chain.”

Prompt Payment Code

The Prompt Payment Code (PPC) requires firms signed up to pay 95% of supplier invoices within 60 days.

A review of whether companies are meeting the standards was completed in its first phase earlier this month and the process identified 17 companies to be either removed or suspended.

CPA wrote earlier this month about big companies accused of ‘ignoring rules’ over paying their suppliers

The five  removed were : global mining giant BHP Billiton; logistics business DHL; engineer GKN; construction company John Sisk & Co; and Tea maker, Twinings & Co.

The 12 companies  suspended were: IT firm Atos IT services; Infrastructure business  Balfour Beatty; err? sugar company British Sugar UK; infrastructure co – Costain Limited; Energy co Engie Services Limited; Services co Interserve Construction; Engineeering co Kellogg Brown & Root Limited; Construction co Laing O’Rourke; Buyilder Persimmon Homes; Engineer Rolls Royce; Utility company SSE; and mobile phone company Vodafone Limited.

Government contractors to face more payment scrutiny

The report comes as large contractors are set to face stricter consequences for mistreating suppliers.

New rules coming into force in September 2019 will see big government contractors required to publish details on their performance on payments, in a bid to prevent those contractors with chronic late payment records from winning future government contracts.

G4S, which operates in nearly 90 countries, is one of the leading outsourcing firms both in the UK and worldwide, and draws much of its business from major government contracts.

Renewed efforts to clamp down on late payments within business come as the damaging practice has a significant impact on the health of supplier firms, with small businesses being particularly affected.

SMEs are often placed at greater risk by late payment practices as they are usually less able to absorb unexpected losses.

Data suggest that issues with late payment cause as many as 50,000 small businesses to collapse every year, with the practice estimated to cost UK businesses a total of £2.5bn a year.

Do you have a problem with late payments?

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply to businesses on credit help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When you customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

Do you realise you may have hidden capital tied up in your business?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you need extra capital, rather than shutting down or jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden stash of cash  within your business, sitting there, just waiting to be uncovered and released?

We can help you uncover a hidden goldmine, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could be the cash rescue your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cashflow.

Don’t let your bankers control you, contact CPA today.

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

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