Labour peer Lord Gordon Borrie is calling for a huge expansion of the Financial Conduct Authority’s remit by helping small businesses chase debts.
Speaking in the House of Lords this week, Lord Borrie wants to see the FCA, which is funded by a levy on the financial services industry, help SMEs to collect money owed to them by larger firms.
A report, Growing your Business, published last week by the prime minister’s enterprise adviser Lord David Young highlighted problems with SMEs being paid on time and said there should be Government action to help.
Trading Standards vice-president Lord Borrie said: “Larger companies deprive SMEs of their cash flow because the cash flow does not proceed in accordance with the dates that the contract has set out. Payments are delayed and small companies have to put up with that. This is a very real problem.
“Instead of creating some new body, one should look at the FCA which was set up recently by the Government; it is a perfectly good, existing body that could be given the task of assisting the creditors among the small enterprises which really need assistance.
“It is unreasonable to leave it to consumers or small businesses to fight their own case. If they start fighting their own case, they may find that that supplier does not wish to deal with them again.”