Suppliers will be paid early in boost drive
Friday 13th February 2009, 11:49AM GMT.
A Shropshire council has decided to put its money where its mouth is in its latest initiative to boost the economy. Telford & Wrekin Council said it will now settle its invoices in just 20 days from April, compared to the current 25 days.
Nearly half of the £127 million the council expects to spend with suppliers this year will go to businesses based in the borough alone.
The vast majority of the remainder will be spent with businesses in Shropshire and the West Midlands.
The move is the latest in a series of measures by the council as part of its Beat the Credit Crunch campaign to bolster the economy and support residents and firms.
It will also mean the council will be beating the target time which Government sets for public bodies to settle invoices by 10 days.
Councillor Adrian Lawrence, the council’s cabinet member for resources, said: “The Audit Commission already rates us among the top councils for prompt payment of invoices.
“But in this current climate, we want to do more to support local business.
“With £63 million spent with suppliers in the borough this year alone, I believe that this will make a real difference and hope that the benefits can also trickle down and that, in turn, our suppliers can also do their bit to help keep the local economy moving.”
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Good work TWC. Fair do’s – that will actually help local small business cash flows – it’s good to see that you are bucking the trend with so many organisations (Tesco etc) extending their payment terms. Well done
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Why does the council not negotiate early payment settlement discount with the suppliers, since the Council will be losing money on the reduced cash balances that they would have available to them.
So the supplier wins by receiving payment early and also the Council saves money by gaining extra discount.
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