Corbyn criticised for false late payment accusations
19/04/2017 / Comments 0
Labour leader Jeremy Corbyn has come under fire for quoting inaccurate figures when naming and shaming the payment practices of some of the UK’s largest firms at a Federation of Small Businesses event last week.
In his speech, in which he rightly labelled the issue of late payment “a national scandal”, he suggested Capita and Marks & Spencer pay their suppliers 82 days and 72 days late on average respectively, while others such as BT, Vodafone, E.On and the National Grid were also singled out.
However, each one has hit back saying they don’t recognise the figures, with Experian – whose data Labour had misinterpreted – explaining the figures solely related to invoices settled late, and didn’t take into account payments that had been made on time.
The blunder has sadly overshadowed the wider point of Mr Corbyn’s speech, in which he blasted larger companies for treating suppliers as tools to borrow interest-free from and laid out his ideas for a future Labour government to combat the issue.
“Cash is king for any business, and big companies are managing their cash by borrowing – interest free – from their suppliers,” he said.
“Some of the biggest names in business are holding cash piles that don’t actually belong to them.
“It’s a national scandal. And it’s stopping businesses from growing and causing thousands to go bust every year.
“It kills jobs and holds back economic growth.”
Fining late payers
His speech comes less than a week after the government introduced new regulations, which require the country’s largest businesses to report on their payment practices on a twice-yearly basis. But Mr Corbyn has said he would go further were Labour in power.
As well as considering fining businesses that pay their invoices late, he said they would also require companies bidding for public sector contracts to pay suppliers within 30 days.
These were just two measures he outlined to boost small businesses, while also saying he would scrap quarterly reporting for businesses with turnover of less than £83,000 and pledging not to increase corporation tax.
He also reiterated that Labour would create regional investment banks to improve businesses’ access to finance.
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