ISME Demands Govt Takes Action More In Late Payments Issue

ISME, the Irish Small & Medium Enterprises Association, has demanded that the Government take a much stronger hand in the issue of Late Payments to SMEs in Ireland and introduce a strict statutory 30 day payment regime for all businesses trading within Ireland, to be phased in over 3 years.

Speaking at the National Seminar on Late Payments in Dublin today, ISME Chief Executive Mark Fielding stated that the current legislation is working against small business and that the new EU Directive, due to be transposed into Irish law in March, will exacerbate the situation, driving more enterprises out of business, due to the vicious cycle created by larger business and government agencies delaying payments to their smaller suppliers.

Mr Fielding said: "We are telling the EU Commission, here today, and our own Government, that their efforts on Late Payments have not worked for Ireland and in fact have exacerbated the situation by allowing big business and Government agencies contract out of the legislation, thereby abusing their dominant positions. The figures prove it. The average credit period in 2002 was 52 days; today, after 11 years of legislation, it is 71 days.

"The new 'sticking-plaster' Directive is not only ineffective, it is downright madness, as it will enshrine 60 days rather than 30 into legislation; as if big business and Government agencies needed that type of assistance to gouge SMEs even further. The EU principle of 'Think Small First' has been ignored.

"Allowing SMEs to charge 8% rather than 7% on late payments is a sick joke, as small businesses are already being told that they will lose business if they even attempt to charge the current rate. This market power and corresponding fear of harming commercial relationships is not being addressed by the new directive. Another example of 'being seen to do something'.

(CD/GK)