Having unveiled a small business commissioner to help small companies handle disputes over issues such as late payment, Soubry took some time to explain to us what kind of role they’ll have.
The post has been inspired by what has been done in Australia. Having spoken to the commissioner there, Soubry found out that some very effective work can be done behind the scenes by simply picking up the phone and letting a particular CEO know that their finance department is demanding X, Y and Z from a small business supplier.
While this kind of practice cannot be formalised in terms of legislation, most of the time CEOs are appalled to hear that this is common practice and brings it to an end, Soubry explained.
With contract disputes taken down a legal route costing time, effort, money and, perhaps most importantly, relationships, Soubry wants the small business commissioner to act as a mediator to problems.
As outlined by Real Business in March, the separate Small Business, Enterprise and Employment Act is tackling a number of issues and was at the centrepiece at the heart of the previous government’s commitment to make the UK the best place in the world to start and grow a business.
Dealing with access to finance, public sector procurement, employment and company filing requirements – amongst others – it is also hoping to bring about wholesale regulatory reform.
New additions to the Enterprise Bill on the date of its publishing include a clamp down on the late payment of insurance claims to help businesses recover faster from fires and floods and an update to the Industrial Development Act to give new powers for government to fund new broadband projects across the country – “for the benefit of industry or local communities”.
“Deregulation is a big player in all this,” Soubry told Real Business. “We really do want people to take part with the Red Tape Challenge. We want to hear form ordinary small businesses, sole traders, right up to the 250+ guys about what is things making their lives difficult.”
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Soubry’s plans for a small business commissioner have been backed by industry bodies such as the Federation of Small Businesses (FSB) and Confederation of British Industry (CBI), which she believes gives it good validation.
The culture she wants changed has seen businesses shifted from already difficult 60-90 day payment terms to 120 day periods. Not wanting to fall out with customers, Soubry believes small businesses are pressured into going along with this.
“They will now be able to complain to the small business commissioner. [The commissioner] won’t have the power to say this is unlawful, but their role is to champion small businesses and change the culture by working with them,” she added.
“This is about letting businesses get on with what they do best, while taking sensible action to support those that need it.”
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