Emma Jones, Small Business Commissioner

In this episode of Let’s Talk Social Value, Sarah Stone is joined by Emma Jones, the UK’s Small Business Commissioner, to explore the real impact of late payment on SMEs - and what’s changing.

Explore how late payment impacts SMEs and supply chains, upcoming legislation, 60-day payment terms, and why prompt payment is critical to delivering real social value.

We hope you enjoy this episode. If you have a topic you'd like us to discuss or you would like to be considered as a guest please get in touch at hello@samtaler.co.uk. 

Transcript

Let's Talk Social Value - Emma Jones, Small Business Commissioner

[00:00:00] ​

[00:00:10] Sarah Stone: Hello, and welcome to - Let's Talk Social Value.

[00:00:13] I'm Sarah Stone, and I'm absolutely delighted today that Emma Jones is with me. Emma is the UK's Small Business Commissioner, and I'm a huge fan, so I'm very excited that she has, um, managed to, a- agreed to join the podcast. , Emma's a long-standing champion of entrepreneurs. , She's the founder of Enterprise Nation, which she [00:00:30] founded in 2005, , which provides a community and practical support for thousands of UK businesses, and she's advised various governments since 2015 as a business ambassador.

[00:00:38] And in 2025, I think that's right, isn't it, Emma? You became the Small Business Commissioner. 

[00:00:43] Emma Jones: That's right, yep. 

[00:00:44] Sarah Stone: And what does your role as the Small Business Commissioner involve? Sort of what is the Small Business Commissioner, for anyone that doesn't know? 

[00:00:50] Emma Jones: Yeah. Well, first of all, Sarah, thanks for having me on.

[00:00:52] Lovely to be here. So yes, uh, the Small Business Commissioner, even though some people think that I cover all things small business, uh, which I quietly [00:01:00] wish I did, but the actual role is very focused on the topic of prompt payment. So the office- Oh, is it? ... itself, it's ve- very focused on payment. So the office was set up in 2017.

[00:01:10] It's always had the same remit, so kind of eight years on, we exist, and in fact the mission that I've kind of come in, when I came in in June 2025, the mission I kind of said to the team is how do we make life easier for small businesses by getting money moving quicker through the economy and into their hands?

[00:01:28] So our single [00:01:30] remit is to essentially stamp out late payment. 

[00:01:32] Sarah Stone: ...... amazing. - I mean, and that's very exciting, 'cause that's what we're here to say, to talk about, is how, what you're gonna do to stamp out late payment, and what we need- Yep ... businesses to do, and why late payment's a problem as well.

[00:01:41] But I don't think I had realized that the Small Business Commissioner's role was that targeted and that focused. I think I had fallen into the trap that I'm guessing lots of people do of thinking it's broader than that. 

[00:01:52] Emma Jones: Well, this is the thing. When the name is Small Business Commissioner, of course it's a natural assumption to think it covers everything.

[00:01:57] But no, the remit is very narrow. And I guess, uh, [00:02:00] the reason for that is because it's a big problem to solve. So just in terms of kind of the late payment issue and the, in July, so when I joined in June 2025 that following month, the prime minister launched a small business plan. And on that day, we came out with some research showing the size of the late payment problem.

[00:02:18] Costs the UK economy 11 billion a year. 38 businesses go out of business every day due to late payment. And the one that really drives me mad, and the one is that we're really trying to focus on, is business [00:02:30] owners spend on average 86 hours chasing debt. Yeah. So that's kind of the size of the problem, and that's why kind of government has said, "Because that's the size of the issue, we need some really concerted attention to kind of focus on it."

[00:02:43] And the way in which we do do that is there's a lot of positive kind of soft power of trying to build a prompt payment culture. And we do that through producing lots of content. We have a casework team who can respond to cases where small businesses haven't got paid. We [00:03:00] manage a fair payment code on behalf of the government, which celebrates businesses that are paying on time.

[00:03:06] So this has been kind of worked on this for years, where we're kind of essentially saying to big companies, "You need to pay on time, because it's just simply the right thing to do." Anyway, kind of fast-forward to 2026, and what the government is also now looking at is something which is a little bit more firm.

[00:03:22] So essentially, we're looking to move towards legislation to bring in measures that kind of becomes a little bit more [00:03:30] strict around you know, what can be done when businesses just simply aren't paying up. So as I say, up until now, we've had lots of things at our disposal to kind of- Positively build this culture, but legislation coming in will essentially mean that the office has got the carrot of producing lots of content and, you know, celebrating lots of businesses on the code.

[00:03:50] But it will also have a stick to say, "If you're not paying, we've now got powers to do something about it." 

[00:03:56] Sarah Stone: And this, this is what really interests me is because I often say to s- people about when I [00:04:00] talk about social value, and people say, "Well, what is social value?" And they often think it's just this thing that sits in procurement, it's just a question in, in a tender.

[00:04:06] And it, and it's not. It's about social compliance. It's about the public sector making sure that they're buying from companies that operate in a way that aligns with their values. And I often say to people, you know, there are so many things that the government want you to do that they don't legislate for, because they can't, 'cause legislation's a blunt instrument.

[00:04:24] There's limited parliament time, isn't there? You know, there's only so much you can get done. And the stuff they legislate for is, [00:04:30] it's almost like the last resort, isn't it? You know, where they really can't... So that's interesting what you're saying, is you're describing, you know, government's got this kind of whole suite, if you like, of levers and policy guidance and things that it's been putting out in order to get companies to do this voluntarily.

[00:04:44] And what it's now saying is, yeah, this is... It's not that it's not working, but it's not enough. So we also need to legislate, which is why the legislation is coming in. 

[00:04:53] Emma Jones: Absolutely right. And the UK, by the way, if we can get this through legislation, and everything is kind of [00:05:00] working at pace at the moment in order to do that, the UK would be the first country to kind of implement some of these measures.

[00:05:06] And these are big measures, Sarah. So, uh, the one that's kind of, uh, that's sort of touted all the time, 'cause it's kind of contentious, but it's the biggest one, is that the UK would move to a maximum 60-day payment terms. Right. So that means any small business that's currently having to sign contracts for 90 or 120-day payment terms, that would become illegal.

[00:05:26] So we would move to 60-day payment terms, getting money moving [00:05:30] quicker through the economy. And international governments are looking at this. Because as the prime minister said when he launched the small business plan, if we can get this legislation through, the UK would then have the toughest payment laws of the G7.

[00:05:43] Yeah. So other countries are looking to say, "Okay, this is interesting that the UK is taking this direction and saying that we're really serious about it." So yeah, it'll be interesting to kind of see. But it's absolutely as you articulate. We've got all of the culture suite of activity- Yeah ... which we will [00:06:00] continue to deploy- Yeah

[00:06:01] whilst also saying there's a legislation outlet as well. 

[00:06:04] Sarah Stone: Can I ask what is probably a stupid question, but I'm gonna ask it anyway. So you talked about the 60-day cap and it becoming legislation. So at the moment, there's nothing on the statute book, there's no law that says how, what a business's payment terms must be.

[00:06:21] So businesses at the moment are allow- Am I right, they're allowed to set their own payment terms and pay people- Whatever they want 

[00:06:27] Emma Jones: A- according to their own terms Yeah And [00:06:30] the other thing that where there's no requirement is the interest that's charged on late 

[00:06:34] Sarah Stone: invoices I was gonna ask you about that.

[00:06:35] Yes. Yeah. Yes Can I... I'm gonna come onto that- Yep, yep ... if we've, if we've got time, because I- Yep ... really want to talk about that. Yep. But so just on the 60-day payment thing so what we're, you're gonna do is you're gonna be bringing... I- I, just on this late payment, the thing I don't understand, I always say you would never go into a shop and take something off a shelf and say to the shopkeeper, "I want that, and, uh...

[00:06:52] Oh, and, oh, and I want... Can you do me one in pink, and can you make it bigger, and can I have it tomorrow?" Do all of that, and then say, "Oh, and I'm gonna pay... I'll come back next week." You [00:07:00] just wouldn't, would you? You know, you would just pay them straight away, and I don't- Yeah ... I also don't understand why payment terms ha- should be set by the buyer.

[00:07:07] They should be set by the supplier, but that's a whole other conversation. But I don't... what I was gonna ask then is, so you've got the 60-day payment terms, and it's l- it's gonna be illegal, no... It would be illegal for someone to have to have longer payment terms in that, in their contract.

[00:07:19] Yeah. Will that, and maybe this is the detail of the legislation, but will that apply whether the business is located in the UK or not? Or will it, you know, how will it... 'Cause you, you have a lot of [00:07:30] global businesses, right, who operate within the UK. 

[00:07:32] Emma Jones: We do. So it's UK legislation, and it applies to companies operating in the UK who have got more than 50 employees here when it comes to the larger company who's doing the buying.

[00:07:42] Right. So the exemptions, so government inter- So we, just the process that we went through on this is a consultation was launched last July on taking these nine measures. We received lots of responses. That closed in October, and then government came out with its response to the consultation in March.

[00:07:59] And a lot of the [00:08:00] representations that were made during the consultation phase were potentially some unintended consequences of what we were looking to do. One of which being, and it's, uh, you know, very interesting, who would have known, is the Booksellers Association, who essentially said, "If you move to 60-day payment terms for booksellers, it ruins our business model."

[00:08:20] Because similar to the example that you just used, when booksellers buy books, they only pay for them when sold. And if we were kind of saying, "Right, moves to 60 days," it [00:08:30] messes up with their model. So what government has said, government listened to all of this, and it has said, "If you are a small business getting paid by a larger company, or indeed a company of any size, we move to 60-day payment terms."

[00:08:42] What it exempts is large companies buying from other large companies, so that 60 days does not relate- Right ... because it's not government's business. If the small business requests that they want longer payment terms, i.e. if you're a bookseller, you can say, "No, let's stick to what we do," that is also [00:09:00] fine.

[00:09:01] And then the one other exemption is if you're a business and you're importing, you want to essentially be able to kind of pay once the products come to you, and ideally you're selling them and then you pay on sales. So they're the exemptions on the 60 days. But otherwise, the 60 days, if we can get it through legislation, 60 days will apply to all.

[00:09:21] Sarah Stone: Yeah. And just a question on the business size. So it's, it applies to businesses with 50 employees or- 

[00:09:27] Emma Jones: Oh, no. So this, this applies to businesses of [00:09:30] all sizes, but the 

[00:09:31] Sarah Stone: most- Okay. So businesses of all sizes are- All 

[00:09:33] Emma Jones: sizes ... 

[00:09:34] Sarah Stone: oh, will have to offer s- minimum 60-day payment terms? 

[00:09:37] Emma Jones: Correct. Correct. 

[00:09:38] Sarah Stone: Perfect, to all their suppliers, regardless of the size of the supplier.

[00:09:41] Emma Jones: Yeah, sorry, maximum 60-day payment term. 

[00:09:43] Sarah Stone: Maximum, sorry. Yes. I was gonna say, 

[00:09:45] Emma Jones: we, we don't want minimum 

[00:09:46] Sarah Stone: 60-day. Yeah, no. As soon as I said it- ... I thought, "That doesn't sound right." 

[00:09:48] Emma Jones: Yeah, 

[00:09:49] Sarah Stone: maximum. And then just to go back, which is really, it is exciting and it isn't ex- It's exciting 'cause it's legislation.

[00:09:55] It isn't exciting 'cause I still think 60 days is too long, but that's a whole other conversation. Yeah. But in terms [00:10:00] of the, in terms of the interest rate, 'cause that's really interesting as well. Yeah. Is it, is it 8% that you're setting? It's quite high. 

[00:10:05] Emma Jones: It is. It's 8% above the Bank of England base rate. 

[00:10:09] Sarah Stone: Ooh, 

[00:10:09] Emma Jones: so- 

[00:10:09] Sarah Stone: So 

[00:10:10] Emma Jones: it's 8% in addition.

[00:10:11] So- Does 

[00:10:11] Sarah Stone: that mean if the Bank of England base rate is, God knows as on what it is now, 5% or something? 

[00:10:15] Emma Jones: So if it's, then it's 5 plus 8. Then 

[00:10:16] Sarah Stone: it's that. 

[00:10:17] Emma Jones: Correct. 

[00:10:18] Sarah Stone: Oh, okay. Correct. And the other thing that I read, and I want to check this with you, is am I right in thinking that it gets it's going to get applied whether the small business asks for it or not?

[00:10:28] So it, [00:10:30] like, it's, at the moment, you know, we write on our invoices, you know, we, "Please will you pay us promptly within 30 days. Any late payment will incur interest." We never charge interest because we don't want to annoy our clients, even though, you know, they're very large companies, and often it takes them longer than 30 days to pay us.

[00:10:44] But are you saying that that interest would have to legally be applied? It's like automatic. 

[00:10:50] Emma Jones: It's au- It's automatic. It's an automatic application. Exactly that. So on 60 days, the interest, the mandatory interest and above Bank of England ra- [00:11:00] base rate gets automatically applied. The next question, and this is the detail of the legislation, is whose job is it to request that?

[00:11:07] Sarah Stone: Yeah, I was about to ask. Is it the onus of the company doing the paying, I'm guessing? 

[00:11:12] Emma Jones: So it's a little bit of both. So it's an onus of the company that wants to get paid, where you kind of say, "Look, do you know that the clock is ticking and this au- automatic, uh, application of interest?" However, at the same time, we do have large companies who publicly have to report their payment performance data, [00:11:30] and that is also showing the amount of interest they're having to pay on late invoices.

[00:11:34] So we are essentially investigating that data all the time to essentially say to companies, "This is the amount of interest you owe on the late paid invoices." So what we're trying to do through the legislation is shift the onus more away from the small business and onto the larger company when it comes to you've got to report the interest owing.

[00:11:54] There's automatic application of that interest, so you need to pay it. But ultimately, [00:12:00] we do also want small businesses to know their rights- Yeah ... so that small business can say, if it goes to 65 days, the small business knows, "Well, I can say, well, that's five days worth of interest that's accruing." So it will still be a little bit of both.

[00:12:13] Yeah. Small businesses knowing their rights, big companies applying it, but it will be an automatic application of the interest. 

[00:12:20] Sarah Stone: Which is the most... I have lots of questions, but we don't need to... I'm sure all the detail will get worked out when the legislation comes out. I suppose what, what would you say the message that government is [00:12:30] sending to, to companies about late payment is?

[00:12:34] Well, the- With this new stuff, new legislation 

[00:12:36] Emma Jones: The big message is that it's kind of pay up. So for those- Yeah ... businesses that aren't paying on time, we need to see a change in behavior. And Sarah, I have to say kind of since coming into role, when I see the cases that come in of small businesses not getting paid on time, m- in many of those cases it's purely through admin error that the payment hasn't been made.

[00:12:56] Yes. So it, the, the larger company has just changed their processes. There was s- in- [00:13:00] inaccurate information on the invoice. So I have to say, I haven't seen huge amounts of mal-intent when it comes to not paying. But what government is saying is, "We've got to get money flowing and cash flow strong for small businesses in order for them to grow."

[00:13:15] And I come back to those kind of problem statistics. If we can free up 86 hours of a business owner's time where they're not chasing debt for, uh, services or products that they've delivered, then in which case they can use that time to grow [00:13:30] more productively. So government's saying on the small business side, "Let's free up your time and free up your cash so you can grow as a business."

[00:13:38] And on the larger company side, it is about, again, back to your comments, it's about being fair in business. Mm. You surely want a work, workforce or kind of a base of happy suppliers, and therefore one of the ways in which to get happy SME suppliers is simply to pay them on time. 

[00:13:54] Sarah Stone: Well, I know, I, I'm so pleased that you, that we finished with that because that, that has been my experience.

[00:13:58] I, .. i have come across it, but [00:14:00] it's very rare that you see that late payment is because of people managing cash flows or, or lack of intent. It's always administrative. And the complexity of some of the large company systems is just insane, quite frankly. ... so I'm really pleased to hear you say that.

[00:14:14] And what you're basically saying to them is these insanely complex systems are not, it's not okay. You need to do something about them. But what's really interesting is how much in our experience the staff working for these companies hate it. So they hate, they get [00:14:30] embarrassed.

[00:14:30] They're, we have to have, they say things, "We're so sorry. We're really embarrassed. You've done a really good job. It's really embarrassing we can't pay you." Do you know what I mean? It makes them feel bad. A- and I would say that that's a benefit for companies. You know, they, they, their staff will no longer have to spend, have awkward conversations with suppliers, or have to spend time dealing with suppliers who are chasing payments, and won't have to be embarrassed about the company that they work for 

[00:14:52] Emma Jones: Well, this is the thing.

[00:14:53] So legislation gives clearer frameworks so that both sides of the party kind of know what their [00:15:00] rights are. And we're working closely with the Accounts Payable Association, which is the association for many amazing people who work in the accounts team. And one of the things, because of, of course, late payment is multifaceted, it can happen for lots of diff- reasons, so our job is to try and make sure that we're kind of, uh, influencing those different areas.

[00:15:19] So the thing we're working on with the Accounts Payable Association is how can accounts teams furnish small businesses with all they need to know in order- Yeah ... to have a successful [00:15:30] onboarding- Yes ... into systems. Then, as I say, kind of putting the correct information on the invoices, knowing who to contact if the invoice is late.

[00:15:38] So we're working with them to kind of make sure all of that works. And just, you've mentioned systems. We're also in lovely discussions, 'cause they're positive discussions, with lots of systems providers on, how can the technology products essentially do lots of the shifting? So for instance, lots of the cloud accounting software providers now, they can do payment chasing on behalf [00:16:00] of small businesses.

[00:16:00] So all of these, uh, sort of essentially moves, this all accounts to progress to getting us to that point of much more prompt payment. 

[00:16:07] Sarah Stone: Yeah. Oh, well, thank you very, very much for coming in, explaining that, and talking to people. And what's the timeline with the legislation? When are we, you know, when are we, when will we expect to see it being debated?

[00:16:17] Is it being debated at the moment? 

[00:16:19] Emma Jones: Uh, well, uh, there is, next week there is, uh, the King's Speech. We are hopeful that, uh, something might- Yes ... come out in the King's 

[00:16:27] Sarah Stone: Speech. For those of you... Yeah, I'm, I guess by the time we publish [00:16:30] this podcast, the King's Speech will have been published, so. Okay. But for those people who don't know, the list of the legislation that goes into the King's Speech is hotly debated, isn't it?

[00:16:37] And it's a, yeah, it's a bit of a bun fight to try and get in. But you are- Well- Fingers crossed ... 

[00:16:41] Emma Jones: we are hopeful. Fingers crossed. And then, uh, if we can get in there, then hopefully- Yeah ... as quick as 

[00:16:45] Sarah Stone: the And then it's the next 12 months, isn't it? ... Prime Minister can table it in the House. Once it's in the King's Speech.

[00:16:48] Emma Jones: Exactly. Perfect. 

[00:16:49] Sarah Stone: Brilliant. Well, we will watch with interest. Thank you very, very much. 

[00:16:53] Emma Jones: Thank you for having me on. Thanks, Sarah.