House of Commons Amendments

Session 2014 - 15
Internet Publications
Other Bills before Parliament

41

House of Commons

Notices of Amendments

given on

Thursday 16 October 2014

For other Amendment(s) see the following page(s):

Small Business, Enterprise and Employment Bill Committee 25-39

Public Bill Committee

Small Business, Enterprise and Employment

Bill

Toby Perkins

Mr Iain Wright

Ian Murray

NC4

To move the following Clause—

“Government impact on small business performance: duty to report

(1)
The Secretary of State must provide for the making of an annual report to each

House of Parliament setting out steps the Government has taken to support British

small and medium-sized businesses over the previous 12 months.

(2)
The statement mentioned in subsection (1) must be made no more than 10 sitting

days before, or after, the end of each financial year following the coming into

force of this Act.”.

Member’s explanatory statement

Clause 14 gives the Secretary of State a duty to report on progress towards achieving the objective

in clause 13. This new clause builds on this principle by creating a new duty on the Secretary of

State to report to Parliament on what the Government has done to support British small and

medium-sized businesses.

Toby Perkins

Mr Iain Wright

Ian Murray

Debbie Abrahams

NC5

To move the following Clause—

“Companies: dealing with suppliers

(1)
The Secretary of State may make regulations—

Notices of Amendments:
42

, continued

(a)
imposing a limit on the number of days after receipt of a supplier’s

invoice a company can seek to challenge that invoice;

(b)
prohibiting the practice of a company seeking to change the payment

terms of a supplier company unilaterally; and

(c)
prohibiting a company from requiring a supplier company to make a

payment in order to join that company’s list of suppliers.

(2)
The regulations may make provision for a prescribed breach by a prescribed

description of person of a requirement or prohibition imposed by the regulations

to be an offence punishable on summary conviction—

(a)
in England and Wales by a fine;

(b)
in Scotland or Northern Ireland, by a fine not exceeding level 5 on the

standard scale.

(3)
The regulations may specify the size of company and supplier company to which

they will apply.

(4)
Before making regulations under this section the Secretary of State must consult

such persons as the Secretary of State considers appropriate.

(5)
Regulations under this section are subject to the affirmative resolution procedure.

(6)
For the purposes of this section—

“company” has the meaning given by section 1(1) of the Companies Act

2006;

“prescribed” means prescribed by the regulations.”.

Member’s explanatory statement

This new clause gives the Secretary of State new regulation-making powers to impose a limit on

the number of days after the receipt of a supplier’s invoice a company may challenge that invoice,

to prohibit companies from seeking to change the payment terms of a supplier company

unilaterally or requiring supplier companies to pay to join that company’s list of suppliers.

Toby Perkins

Mr Iain Wright

Ian Murray

Debbie Abrahams

Clause  3,  page  3,  line  43,  after “policies”, insert “and performance”.

Member’s explanatory statement

This amendment provides that companies can be judged on their performance in practice.

Toby Perkins

Mr Iain Wright

Ian Murray

Debbie Abrahams

Clause  3,  page  4,  line  28,  at end add—

“(4A)
“Performance” has such meaning as may be prescribed, and the information

which may be prescribed shall in particular include information on late payment

of invoices by the company, to include in a quarterly report which shall include—

(a)
lists of all payments to suppliers which were made over 30 days after the

date indicated by the suppliers agreed payment terms, without a formal

query having been registered with the suppliers within a period as may be

prescribed;

(b)
confirmation, for each instance listed under paragraph (a), that interest,

equalling the Bank of England base rate plus 8% APR, was paid to

compensate the supplier for overdue payment; and

Notices of Amendments:
43

, continued

(c)
assurance, for each instance listed under paragraph (a) where

confirmation of compensation under paragraph (b) cannot be provided,

of a payment plan in place to compensate suppliers on the basis set out in

that paragraph.”.

Member’s explanatory statement

This amendment defines “performance” against which companies will be judged.

Toby Perkins

Mr Iain Wright

Ian Murray

Debbie Abrahams

Clause  3,  page  4,  line  31,  at end add—

“(5A)
A person making a false report of payment performance commits an offence

punishable under subsection (8).”.

Member’s explanatory statement

This amendment establishes that the financial reporting officer shall be liable for false reporting.

Toby Perkins

Mr Iain Wright

Ian Murray

Debbie Abrahams

Clause  3,  page  4,  line  40,  at end add—

“(8)
It shall be an offence for a company, prescribed by the Secretary of State, to fail

to complete a payment plan to compensate a supplier where payment to that

supplier has been delayed by more than 30 days after the date indicated by that

supplier’s agreed payment terms.

(9)
A company committing an offence under subsection (8) shall be subject to a fine

not exceeding the amount of the invoice, up to £10,000 on summary conviction.”.

Member’s explanatory statement

This amendment makes it an offence for companies not to fulfil compensation payment plans.

Toby Perkins

Mr Iain Wright

Ian Murray

Clause  4,  page  5,  line  9,  at end insert—

“(c)
a duty on designated banks and designated credit reference agencies to

provide, for no charge, information about the criteria used to calculate the

credit score of the small and medium-sized business customer to which

the information relates provided that a request in writing for that

information is made by that business customer.”.

Member’s explanatory statement

This amendment imposes a duty on designated banks and designated CRAs to provide information

about the criteria used to calculate the credit score of the small and medium-sized business

customer to which the information relates.

Toby Perkins

Mr Iain Wright

Ian Murray

Clause  30,  page  26,  line  7,  after “business””, insert ““medium-sized business”,

“large business” or “super corporate””.

Notices of Amendments:
44

, continued

Toby Perkins

Mr Iain Wright

Ian Murray

Clause  30,  page  26,  leave out lines 10 to 18 and insert—

““Micro business” means a business with 1-9 employees

“Small business” means a business with 10-49 employees

“Medium-sized business” means a business with 50-249 employees

“Large business” means a business with 250-1000 employees

“Super corporate” means a business with over 1000 employees”.

Member’s explanatory statement

This amendment proposes to create a total of five definitions in UK law based on the measure of

employee head count.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  5,  page  7,  leave out lines 39 to 41 and insert—

“(8A)
Credit information regulations shall provide a small or medium-sized business

with the right to complain to the Financial Ombudsman seeking a determination

requiring a designated credit reference agency to rectify, block, erase or destroy

data held about the complainant.

(9A)
Section 226A of the Financial Services and Markets Act 2000 is amended as

follows. After subsection (f) insert—

“(g)
the complaint is one falling under section 5(8A) of the Small

Business, Enterprise and Employment Act 2014.””.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  5,  page  6,  line  38,  at end insert—

“(1A)
In making provisions under subsection (1), the Secretary of State shall include a

funding mechanism enabling the Financial Conduct Authority (FCA) to monitor

and enforce compliance with the regulations.”.

Member’s explanatory statement

This is a probing amendment to explore who bears the costs of the FCA process of enforcement

and compliance.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  4,  page  5,  line  9,  at end insert—

“(c)
a duty on designated banks and designated credit reference agencies to

provide information about the criteria used to calculate the credit score of

a small and medium-sized business customer to such customers.”.

Member’s explanatory statement

This amendment aims to establish a duty for banks and credit reference agencies to provide

information about the criteria used to calculate the credit score of an SME customer to increase

transparency and guidance for small firms to understand the calculation of their credit score and

to help them to take steps to improve it.

Notices of Amendments:
45

, continued

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  4,  page  5,  line  19,  at end insert—

“(3A)
The regulations must provide that the duty in subsection (1)(c) only applies where

a small or medium-sized business makes a request to a designated credit reference

agency or bank.”.

Member’s explanatory statement

This amendment aims to establish a duty for banks and credit reference agencies to provide

information about the criteria used to calculate the credit score of an SME customer to increase

transparency and guidance for small firms to understand the calculation of their credit score and

to help them to take steps to improve it.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  4,  page  5,  line  28,  at end insert—

“(ba)
to which the duty in subsection (1)(c) applies.”.

Member’s explanatory statement

This amendment aims to establish a duty for banks and credit reference agencies to provide

information about the criteria used to calculate the credit score of an SME customer to increase

transparency and guidance for small firms to understand the calculation of their credit score and

to help them to take steps to improve it.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  4,  page  6,  line  15,  at end insert—

“(8A)
For the purposes of this section, a designated bank or designated credit reference

agency only share information that has been specifically identified by the

business to which the information relates.”.

Member’s explanatory statement

This amendment is to ensure the security of the data being shared by banks and credit reference

agencies..

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  4,  page  6,  line  33,  at end insert—

“(11A)
Before making regulations under section (4) subsection (1), the Secretary of State

shall carry out an impact assessment which will examine—

(a)
costs incurred by the bank, credit reference agency and business; and

(b)
the impact that costs incurred will have on the final cost of borrowing for

small and medium-sized enterprises.”.

Member’s explanatory statement

This amendment aims to ensure that analysis is undertaken by the Government that looks at the

impact of the costs of this process and procedure on both the sharing of information (the process)

and the final cost of borrowing.

Notices of Amendments:
46

, continued

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  6,  page  8,  line  17,  at end insert—

“(2A)
The Secretary of State may by order specify the information that Commissioners

are permitted to disclose.”.

Member’s explanatory statement

This amendment strengthens the safeguard in subsection (2) restricting the information that can

be disclosed.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  6,  page  8,  line  16,  after “information”, insert “specifically financial

information that would include entire tax records”.

Member’s explanatory statement

This amendment strengthens the safeguard in subsection (2) restricting the information that can

be disclosed.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  11,  page  12,  line  8,  at end insert—

“(6)
Where an instrument is presented for payment under this section, the responsible

bank will be required to ensure the validity of the electronic image as being from

the person who signed the cheque and mechanisms for this will be specified in

regulations under this section.”.

Member’s explanatory statement

This amendment aims to increase assurance over the validity and security of electronic cheques.

Ian Murray

Mr Iain Wright

Toby Perkins

Clause  9,  page  10,  line  21,  at end insert—

“(3A)
Prior to the commencement of section (1) of the Export and Investment

Guarantees Act 1991, as amended, the Secretary of State shall—

(a)
commission an independnet assessment of the functions and powers of

UK Export Finance (UKEF);

(b)
make a report to Parliament of steps to be taken in response to the

findings of the assessment referred to in paragraph (a);

(c)
commission an assessment to determine actions to improve the

awareness of UKEF to small and medium-sized enterprises.”.

Member’s explanatory statement

This amendment aims to require the Secretary of State to assess the powers and functions of the

UKEF and require the Government to reform and relaunch the organisation.

Debbie Abrahams

Clause  3,  page  4,  line  28,  at end insert—

Notices of Amendments:
47

, continued

“(g)
about the circumstances and process for amendment payment terms of

the company.”

Member’s explanatory statement

This amendment aims to require companies to include details of the circumstances and process

(including who will be involved) by which payment terms can be amended, preventing unilateral

and ad hoc changes.

Debbie Abrahams

Clause  3,  page  4,  line  40,  leave out “may” and insert “shall”

Debbie Abrahams

Clause  3,  page  5,  line  29,  leave out “may” and insert “shall”

Debbie Abrahams

Clause  3,  page  5,  line  32,  leave out “may” and insert “shall”

Debbie Abrahams

Clause  3,  page  5,  line  35,  leave out “may” and insert “shall”

Debbie Abrahams

Clause  33,  page  28,  line  40,  at end insert—

“(a1)
duties to establish the past payment performance of potential parties to a

contract, before contracts are entered into;

(a2)
duties to ensure contracts entered into include the contractors’

obligations for prompt payment of their suppliers.”

Member’s explanatory statement

This amendment aims to ensure that the payment performance of potential contractors are known

before contracts are entered into and that contracts entered into require companies providing

goods and services to public sector contracting authorities to pay their own suppliers promptly.

Debbie Abrahams

Clause  11,  page  14,  line  19,  at end insert—

“PART 4A1

PROTECTION OF RETENTION MONIES IN THE CONSTRUCTION INDUSTRY

89A1
Interpretation

(1)
In this Part—

“adjudication” and “adjudicator” have the meaning given to it in section 108

of the Housing Grants, Construction and Regeneration Act 1986 (as

amended).

“bank” has the meaning given to it by section 2 of the Banking Act 2009.

“construction contract” has the meaning given to it by section 104 of the

Housing Grants, Construction and regeneration Act 1996 (as amended).



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