​A quarter of a million is a big number – but it can be measured and managed says FSB

FSB lobbied all parties on prompt payment of invoicesFSB lobbied all parties on prompt payment of invoices
FSB lobbied all parties on prompt payment of invoices
​A quarter of a million is generally regarded as a BIG number. Such figures can be hard to put into context, so here are a few reference points.

The distance from Earth to the Moon is a quarter of a million miles. By coincidence, an intrepid traveller would need to circumnavigate the Earth ten times to cover the same distance.

A quarter of a million days ago, the population of the entirety of Europe was less than that of just the UK today, and the Black Plague was yet to strike. Aside from measurements in distance and time, the longest of J.K. Rowling’s magical novels – Harry Potter and the Order of the Phoenix - only just breached the quarter million word count, as did James Joyce’s epic tome, Ulysses.

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These random efforts at illustrating the sheer scale of the number ‘a quarter of a million’ show that, by almost any measure, it is huge; not incomprehensibly big, but certainly commanding respect. It is for that reason that we, in the Federation of Small Businesses, have been so shocked by the fact that over a quarter of a million invoices were paid late last year by public bodies in Northern Ireland. Small businesses compete to win contracts to supply goods and services to councils and other public bodies - a time consuming and onerous job with no guarantee of success. However, having won the tender, completed the job, then submitted their invoice, the least they should expect is to be paid within the legal timeframe. Yet on over a quarter of a million occasions last year, public bodies breached the law and failed to pay for what they had bought within the legal timeframe.

Roger Pollen, Head of FSB in NIRoger Pollen, Head of FSB in NI
Roger Pollen, Head of FSB in NI

Business owners join FSB for two main reasons. The first is for the individual services they access as part of our collective buying power; the second is for our lobbying effort – using their experiences to bring about change. Sadly, one of the services we provide, free of charge as part of the FSB membership, is Debt Recovery. I say “sadly” because chasing up late payers is so commonplace that members have frequent need of the service. But the other way FSB addresses problem is to tackle the cause in order to help all businesses. In this case, we are shining a light on the problem and engaging with politicians both to raise the issue as well as proposing a remedy.

In striving for this, it is worth remembering that one of the major causes of business failure is poor cashflow - not profitability, but getting money in when it is owed and needed. Unlike elsewhere, public bodies do not undertake spending unless they have budgeted for it, so paying late doesn’t save money or give any benefit – it just causes unacceptable inconvenience and distress. There’s a maxim that says “if you can’t measure it, you can’t manage it”, however, the late payment of invoices can, indeed, be measured, therefore it must be measured – and then it must be managed. Only by doing that can we hope to end the scourge of late payment and replace it with a culture of Prompt Payment.

So, as the biggest business lobby, FSB took the opportunity of last month’s election to engage with the leaders and policy teams of each political party to highlight the extent of the problem and propose a way of addressing it. The good news is that each of the parties agreed with FSB, and most supported our proposal to see an elected Councillor and a senior member of staff in each of the eleven councils given specific responsibility for measuring their council’s performance. FSB has been collating a league table showing the performance of each of the councils and, whilst it makes for grim reading, our first preference is to see improvement rather than ‘name and shame’. The parties have all agreed it is a priority, so there should be no resistance to measuring current performance, learning what each council needs to do to improve, and implementing the necessary changes.

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This is one of those rare public policy initiatives that can deliver great benefit at almost no cost. We will monitor, encourage, and support but, if necessary, we won’t shirk from shining the spotlight if the culture doesn’t change and performance doesn’t improve. The ‘quarter of a million late’ status quo is unacceptable; we must all demand change.

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