26 August 2010 | Lindsay Clark
A number of police forces in the UK are failing to pay their suppliers promptly, according to a business group.
A report, by the Forum of Private Business, said there was a vast difference in the amount of time forces take to pay their suppliers and contractors.
The Forum used the Freedom of Information Act to ask every civilian police force in the UK how quickly they processed payments to businesses during the 2009/10 financial year.
The results show that some forces paid less than one per cent of their bills within 10 days and took more than 30 days to pay well over half their invoices.
The UK government has requested that public sector organisations pay vendors within 10 days in order to improve cash-flow to their suppliers. After 30 days, suppliers can claim statutory interest for unpaid bills.
The poor performances of many forces meant that, on average, UK police forces paid just 24 per cent of invoices within 10 days and 77 per cent within 30 days, the report said.
Forum spokesman Chris Gorman said: “We found that some police forces appear to be excellent at paying businesses promptly. This is to be welcomed, and I’m sure their efforts are appreciated by the smaller firms that work for them. However, many others seem to be making little or no effort to pay their suppliers and contractors quickly. This means the companies they deal with may well find their finances under serious pressure while they are waiting to be paid.
“It also means the poorly-paying forces may be limiting the range of companies willing to work for them to only larger businesses with substantial cash reserves. This is bad both for small businesses and for the public purse, because it means there will be less competition in the tendering process.”
As reported in Supply Management in 13 May 2010, the OGC published guidance for buyers on the new requirement to include a mandatory clause in supplier contracts, which obliges vendors to pay their own suppliers within 30 days.