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# Lichfield and Burntwood MP warns delayed payments to suppliers could send smaller businesses under
- URL: https://lichfieldlive.co.uk/lichfield-and-burntwood-mp-warns-delayed-payments-to-suppliers-could-send-smaller-businesses-under/
- Published: 2020-04-17T07:31:30.000Z
- Updated: 2020-04-17T07:31:50.000Z
- Description: Lichfield and Burntwood’s MP has joined calls for stricter controls on large companies paying suppliers to prevent smaller businesses from going bust.
- Author: Lichfield Live
- Tags: Business, Politics, #wp, #wp-post, #Import 2026-07-22 18:18, News

Lichfield and Burntwood’s MP has joined calls for stricter controls on large companies paying suppliers to prevent smaller businesses from going bust.

Michael Fabricant has co-authored a letter to the Chancellor of the Exchequer with Lib Dem MP Sarah Olney.

The pair say the outbreak has show the dangers of larger companies who “hoard cash” at the expense of smaller suppliers.

Mr Fabricant said:

> “Having been in business before I became an MP, I am well aware that a positive cash flow – as well as profitability – is needed by businesses to keep trading.  
>  
> “If larger companies don’t pay on time, smaller businesses won’t get the chance to be the big employers of the future, instead they could go bust.  
>  
> “It is even more critical now as businesses try to survive during the national lock-down due to COVID-19.”  
>  
> Michael Fabricant

The Conservative MP has previously raised the issue in a debate in the House of Commons last month.

The full letter from the two MPs can be seen below:

> *The level of late payment debt owed to small and medium-sized businesses was far too high even before the outbreak and many small firms now find themselves in a perilous position.* 
>  
> *Many still have no choice but to trade with long delays to payment imposed on them by larger customers and the pandemic has only exacerbated this problem.* 
>  
> *In light of these difficulties, several large firms have done the right thing and paid their suppliers promptly. But many others have not.* 
>  
> *In the current crisis successful businesses, deprived of payment, may now have to take support loans from the government, lay off staff or even enter administration.* 
>  
> *Large companies should pay their suppliers on time and not hoard cash when their suppliers are struggling.* 
>  
> *We fully support the Chancellor’s support package for businesses and employees, but we must do more for small and medium-sized businesses.* 
>  
> *By ensuring that suppliers are paid on time, the risk of bankruptcy or the need to call on government loans is greatly reduced.* 
>  
> *To achieve this, the Small Business Commissioner should be given the power to fine companies that consistently fail to pay suppliers on time and make the Prompt Payment Code compulsory rather than voluntary for organisations with more than 250 employees.* 
>  
> *These steps will help eliminate the practice of delaying payments to suppliers and alleviate the financial pressures that this pandemic has put on so many successful businesses.* 
>  
> *Before Carillion collapsed in 2018 it extended payment times to 120 days. It went bust owing over £2bn to 30,000 suppliers and creditors leaving many of these firms in dire straits.* 
>  
> *We must take action now to ensure that we do not see this repeated, in the current climate it could cause damage far exceeding the collapse of Carillion.*  
>  
> Letter from Michael Fabricant MP and Sarah Olney MP