The Small Business Commissioner, Paul Uppal, has published a report on BUPA Insurance Services Ltd exposing their poor payment practices and inadequate offer of late payment interest to its small chain supplier.
Blacklight Advisory Ltd submitted a formal complaint to the Small Business Commissioner after BUPA Insurance Services Ltd failed to pay them £29,403 for the delivery of consultancy services, which were based on 45-day end of month payment terms.
As a result of the Commissioner’s investigation, BUPA Insurance Services Ltd released money for the unpaid invoice on the same day in addition to offering late payment interest at only 2% above the Bank of England base rate.
BUPA Insurance Services Ltd, stated that this incident occurred due to staffing inefficiencies, however this message was never conveyed to Blacklight Advisory Ltd who were instead continually misled and reassured by the Finance Director that there were no issues and payment was being processed, whilst also revealing payment delays were commonplace in the BUPA Finance department.
Small Business Commissioner, Paul Uppal commented:
“My investigation uncovered numerous contradictions with BUPA Insurance Services Ltd reasoning behind the unpaid invoices.
“BUPA Insurance Services Ltd offer 30-day preferential terms, however when the complainant was chasing payment and expressed their distress, these terms were never offered. BUPA Insurance Services Ltd should increase the transparency of their 30-day preferential terms to its small business supply chain to prevent anxiety and cash flow issues. Moreover, BUPA Insurance Services Ltd’s Duty to Report data shows that payments made within 30 days has declined by 7% in the last 12 months, and this is simply not good enough for a global brand.
“Although late payment interest was offered as compensation for the unpaid invoices, the interest was 6% below the minimum statutory rate. This is a statutory requirement and large businesses should not manipulate small suppliers into signing away their rights.
“BUPA Insurance Services Ltd claim to be a leading international healthcare group who are committed to make quality healthcare a priority. I would like to see the same level of commitment demonstrated when it comes to protecting the health of their supply chain by offering 30-day payment terms as standard.”
Peter Lock, BUPA Insurance Services Ltd Procurement Director commented: “On this occasion, due to a number of issues including that unfortunately Blacklight did not follow the recommended process and submitted their invoice incorrectly, we have not met our contracted payment terms and would therefore be liable to pay late payment interest in line with our contract with Blacklight. We have already communicated this to Blacklight directly.”
Andy Lyon, Partner at Blacklight Advisory Ltd commented: “Throughout the life of the contract we endured issues with payments which greatly disrupted our advisory business. BUPA Insurance Services Ltd failed to provide us with any recommended processes to follow and the lack of accountability for the mistakes they have made shows little regard or empathy for small businesses.”
If you are a small business experiencing late payment issues with BUPA Insurance Services Ltd or any other large business please contact the Office of the Small Business Commissioner.
The Small Business Commissioner’s report can be viewed here.
Contact: Manveer Mann on 0121 695 7761
The Office of the Small Business Commissioner was launched in December 2017 to ensure fair payment practices for Britain’s 5.7 million small businesses, support them in resolving their payment disputes with larger companies and bring about a culture change in payment practices between businesses and across sectors.
In addition to investigating complaints about late payment issues, the Office provide a variety of free and impartial services such as:
Resolving disputes and dealing with unpaid invoices
Checking contracts and getting invoices right
Signposting small businesses to existing support and dispute resolution services
Interest Calculator on its website – allowing small firms to calculate interest owed on unpaid invoices.
* Legislation imposed in April 2017 required all large businesses to publish their payment practices.