Diageo removed from Prompt Payment Code for failing to pay invoices on time

Diageo removed from Prompt Payment Code for failing to pay invoices on time

Four Diageo subsidiaries have been formally removed from the Prompt Payment Code (PPC) after failing to honour their commitments.

The voluntary code requires companies to pay 95% of invoices within 30 days to their small suppliers and pay 95% of all invoices within 60 days.

The Small Business Commissioner, which administers the PPC on behalf of the Department for Business, Energy and Industrial Strategy, revealed that Diageo Scotland Limited, Diageo Global Supply IBC Limited, Diageo Northern Ireland Limited and Diageo Great Britain Limited had the opportunity to voluntarily withdraw their Code membership but have not engaged with the Small Business Commissioner.

Latest Payment Practice Reporting (PPR) data highlighted that Diageo Scotland Limited were paying 42% of invoices within 60 days, while Diageo Global Supply IBC Limited, were paying 32% of invoices within 60 days.

At the same time, Diageo Northern Ireland Limited were paying 33% of invoices within 60 days, while Diageo Great Britain Limited were paying 36% of invoices in 60 days.

Liz Barclay, Small Business Commissioner, said: “It’s always disappointing when a company can no longer reach the payment standards set by the Prompt Payment Code.

“The Code is there to make sure that suppliers get paid as quickly as possible and when firms leave or are removed there is a risk that payments to suppliers will be slower. We will work with the firms mentioned to get them back onto the Code as quickly as possible should they wish to return, because that’s to the benefit of the suppliers and to the companies themselves.”

The Government has set a standard of 95% of all supply chain invoices to be paid within 60 days for organisations who want to do business with government. Suppliers who do not comply with this standard could be prevented from winning government contracts

Paul Scully, UK small business minister, said: “As our small businesses recover from the pandemic, the last thing they need is for some big firms to hold back the cash that is owed to them.

“I urge the companies that have been removed from the code to get their acts together to improve their performance.”

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