IT firm added to late payment blacklist
Wed, 08 Jul 2009
Northgate Information Solutions has become the latest firm to be entered into the Forum of Private Business' (FPB's) Hall of Shame after it announced plans to take up to 60 days to settle invoices with small companies.
The IT firm follows construction company Rok plc on to the late payment blacklist, after it altered its standard payment terms last week.
In a letter sent out to suppliers, Northgate gave notice of the planned change, offering objectors ten working days to express their concerns, with acceptance of the contractual alteration implicit where no response is received.
Northgate claimed the 60-day timeframe is being introduced to standardise payment terms across its supply base, as different payment arrangements currently caused confusion.
FPB chief executive Phil Orford said that although there could be sympathy for the firm's claim that it is not being paid on time by many of its public sector customers, it is "disappointing" that such additional costs are being passed on to its small suppliers.
He added: "We have written to Northgate to remind the company that it must take responsibility for its credit management systems, of the damage that poor payment practices can do to small businesses, particularly in the current economic climate.
Mr Orford said the firm had been invited to sign up to the government's Prompt Payment Code "without delay".
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