Government fails to deliver on 10 day payment pledge

Despite a government promise that the public sector will pay small business suppliers within 10 days, most departments are failing to deliver, new research claims.

According to the report by Graydon UK, 98% of SMEs supplying government agencies, local government bodies and central government are still not being paid within the timeframe pledged by business secretary Lord Mandelson in October 2008.

Some departments are not even coughing up within the standard trade invoice timeframe of 30 days, the study claimed, with 63% of respondents having to wait more than a month. The figure compares unfavourably with a similar survey in March 2009 when 60% of firms reported waiting more than 30 days to receive monies owed.

Martin Williams, managing director at Graydon UK, said: "The sentiment underlying the government's pledge to radically curtail payment periods in the public sector is laudable but unfortunately it’s now apparent that ministerial willpower hasn’t been enough to inject more speed into the machinery of the public sector.