At present, my Department is undertaking a survey to gauge the level of awareness of and compliance with the late payment legislation. Information from the survey should provide a useful guide for future policy. I expect that final information from the survey will be available to my Department in the autumn.
Last year I made the European Communities (Late Payment in Commercial Transactions) Regulations 2002 to implement Directive 2000/35/EEC of the European Parliament and of the Council on combating late payment in commercial transactions. The regulations came into operation on 7 August 2002 and apply to all commercial transactions in the public and private sectors. They provide that interest shall be payable in respect of the late payment of a commercial debt. A payment is regarded as late if it has not been paid 30 days after an invoice or goods have been received or by a date as agreed by contract. The regulations also provide that compensation may be claimed for debt recovery costs.
It is generally accepted that the payment practices of public sector bodies improved after the Prompt Payment of Accounts Act 1997 came into operation in January 1998. Sections 4 to 11 of that Act were repealed when the EU directive on combating late payment was implemented. Payment practices in the public as well as the private sector are now covered by the European Communities (Late Payment in Commercial Transactions) Regulations 2002.
