North East councils are leading the way in helping small businesses get paid faster, thanks to an initiative supported by the North East Procurement Organisation (NEPO). A milestone 1,500 firms in the region have now benefitted from the scheme.
Newcastle, Gateshead, Middlesbrough, and Northumberland councils, who work in partnership with NEPO, introduced a free early payment programme to pay invoices from small and micro firms, with a focus on helping local suppliers.
Small businesses often struggle to get paid on time, which can put them into financial difficulties. NEPO’s free early payment programme can reduce by two-thirds the number of days suppliers need to wait for the payment of invoices, delivering millions of pounds of vital cashflow. This, in turn, fuels jobs and encourages further investment throughout the wider supply chain, supporting the local economy.
Speaking about the initiative, the small business commissioner, Liz Barclay said: “It’s great to see positive change in payment practice. Getting money into the hands of smaller businesses earlier reduces uncertainty and increases confidence, which is good for jobs and society. Early payment programmes are leading the way in progressive payment.”
The free, early payment programmes, allow councils to pay businesses with fewer than 50 employees much earlier than usual, at no cost to the firms. Around 1,500 suppliers to the four councils are already benefiting from the programme, with another 500 due to enrol over the next few months.
Steven Sinclair, NEPO’s procurement and commercial director commented: “Small and micro businesses are the lifeblood of the economy in the North East. As significant buyers of goods and services, it’s vital that councils lead the way in adopting good financial governance. NEPO is delighted that our members have recognised this by implementing progressive early payment practices, helping local enterprise during these uncertain times.”