An estimated 1415 businesses in Merthyr Tydfil and Rhymney could be owed as much as £13,001,713 in late payments from bigger clients.
Figures released by BACS Payment Schemes Ltd have laid bare the extent of late payments to small and medium-sized businesses, which now stands at £26.3 billion. Gerald Jones MP has now revealed what this could mean for Merthyr Tydfil and Rhymney’s local economy.
The Labour MP said:
“This shocking figure of £26.3 billion is a result of big clients not paying our small businesses for months on end – and sometimes, just not paying them at all. Based on the number of businesses in Merthyr Tydfil and Rhymney this means our local economy could be owed over 13,000,000 in late payments. What’s truly shocking is that an estimated 50,000 businesses fail each year because of these late payments. Averaged across the country, that could mean an estimated 28 businesses right here in Merthyr Tydfil and Rhymney are failing each year because larger clients just don’t pay them what they owe.
“It’s important that everyone understands what these national figures mean for local economies. Late payments hurt every local economy across the country. Those appalling national figures mean that our small businesses, our local entrepreneurs; the lifeblood of Merthyr Tydfil and Rhymney are struggling. It’s time for government to step in and make these big clients pay our local business men and women”.
In total, an estimated 47% of all small and medium-sized businesses experience late payments by larger clients, with large private firms singled out as the worst culprits.
The Conservative government announced a new Small Business Commissioner to look at the issue of late payment, which affects an estimated 2.5 million small and medium businesses. Labour has slammed the government’s efforts, with the Shadow Small Business Minister dismissing it as “toothless”.