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Tougher Prompt Payment Code comes into force

From 1st July signatories to the Code must pay invoices issued by small businesses (0-49 employees) within 30 days.

The PPC is a voluntary code of practice sponsored by the Department of Business, Energy and Industrial Strategy (BEIS). Since moving to the Office of the Small Business Commissioner in March 2020 and becoming one of the pre-conditions to winning public sector work, it has more than 3,000 firms signed up. With powers to suspend or exclude from the PPC, it has had the greatest transformational change improving payment performance within construction.

ECA’s Business Policy & Practice team actively tackles the underlying issues which lead to poor payment practices within our sector. For example, we helped conceive the Construction Leadership Council’s Value Toolkit

ECA's Director of Legal and Business Rob Driscoll said in a recent column: "Of most interest to UK small businesses, is the need for signatories to pay 95% of invoices from firms with fewer than 50 employees within 30 days (the target for larger businesses will remain 95% of invoices within 60 days).

"Signatories that are found wanting, risk suspension and/or exclusion from the PPC which may then disqualify them from public sector tendering opportunities. 

"It’s hoped the changes will help the Code to grow further, attract new and significant signatories, and give small businesses real confidence to expect prompt payment from their customers."

Last updated 13 July 21