Issue - meetings

The Director of Finance submits a report which provides the Committee with an overview of the timeliness of invoice payments the authority makes to its suppliers of goods and services. The Committee are asked to note the report and work recently undertaken to meet the Executive pledge to improvement payment terms for small local businesses.

The Director of Finance submitted a report providing the Committee with an overview of the timeliness of invoice payments the authority made to its suppliers of goods and services. 

It was noted that work was ongoing with suppliers and managers to introduce a “No Purchase Order, No Pay” ethos.  To achieve this, a purchase order needed to be raised for all goods and services purchased.  The supplier should then use the purchase order reference on their invoice.  This would make it easier to match the invoice to the relevant purchase order and pay the invoice.

The Committee noted that it was not possible to assess the effectiveness of the work recently undertaken to meet the Executive pledge to improve payment terms for small local business.  It therefore was suggested that a further report could be made to the Committee in 6 months’ time, when more information was available.

Concerns were raised by Members that staff errors, such as entering invoice numbers incorrectly, could create problems with paying invoices.  However, it was noted that a scanning facility had been introduced, which read the information required.  It therefore was not necessary for staff to enter information manually.  Validation processes were in place, to ensure that the system was working correctly.

The Head of Business Centre reported that small businesses had been advised of the Council’s intention to pay their invoices within 21 days, but no reaction to this had been received.  It could be difficult to identify which businesses should be categorised as small, but this was being done on the basis of the number of staff employed and turn-over.  When new suppliers were set up on the finance system, it required officers to enter information on how big the company was, so that the correct payment terms could be applied.

RESOLVED:

1)    That the work recently undertaken to meet the Executive pledge to improve payment terms for small local businesses be noted; and a follow up report be submitted in six months’ time; and

2)    That the Head of Business Centre be asked to submit an analysis of the success of the “No Purchase Order, No Pay” policy to the Committee in six months’ time.