Government departments on target with timely payments

Over 90 per cent of Government department bills were paid within 15 days of receiving a valid invoice, according to figures published today by Minister for Small Business John Perry.

The news follows a series of Government measures “to get credit flowing” in the Irish economy by encouraging prompt payment in all business transactions.

In the third quarter of this year Government departments made a total of 45,793 payments worth just over €748 million.

“39,437 payments valued at €703m were paid within 15 days. In value terms, this represents 94 per cent of the total payments made by Government Departments,” said Mr Perry.

He added that the figures show departments’ efforts to comply with the Government’s requirement to pay business suppliers within 15 days of receiving a valid invoice.

The Department of Transport, Tourism and Sport as well as the Department of Education were the most prompt - paying 100 per cent and 98 per cent of the amounts they owed within 15 days - while the Department of Social Protection was the most tardy, paying 63 per cent (about €54 million) within 15 days.

Agencies under the auspices of the Department of Jobs, Enterprise and Innovation (DJEI) also paid 90 per cent of their total payments within 15 days, according to Mr Perry.

“A total of 19,197 payments were made in Quarter three of 2013, amounting to just over €34 milion,” he said. “Of these, 17,319 payments amounting to €31 million were paid within 15 days”.

Thirteen agencies operate under the DJEI including the Competition Authority, Enterprise Ireland as well as the Health and Safety Authority, which only managed to pay 47 per cent (€ 559,390) of payments due within the 15 day timeframe. However, almost 80 per cent (€ 949,117) of these bills were paid within 30 days.

Mr Perry said that a “prompt payment code of conduct for business” and a “late payment information campaign” are also set to be rolled out.

According to the Sligo-North Leitrim TD the code of conduct aims to improve cash flow between businesses and to also help “address the culture of late payments in Ireland”.

The EU Late Payment Directive came into effect in March of this year, under which public authorities must pay for goods and services they procure within 30 days. However, in very exceptional circumstance this can be extended to 60 days.

The directive also means that enterprises should pay their invoices within 60 days unless it has been expressly agreed to do otherwise. Businesses are also automatically entitled to claim interest for late payments.

At the time Minister for Jobs, Enterprise and Innovation Richard Bruton, said the new rules will make a "major difference" to SMEs and would act as a deterrent to late payments.

“It will establish a clear expectation that payment will be made according to agreed terms and that creditors will not be penalised,” he said. “It will also ensure that debtors will not benefit from negative actions”.