Prompt payments could save £2m

Oldham Council’s suppliers can in future be paid within five to eight days of their invoice rather than the usual 30 — if they give the council a small discount.

The council’s new early-payment scheme could potentially save it more than £2 million by way of a one or two per cent discount on the bill. But in return the supplier’s faster cash could save overdraft or bank loan fees and ease cash flow.

Councils must pay suppliers within 30 days, but ministers want them to be even quicker to ease cash flow problems.

Council leader Jim McMahon said the move had been welcomed by companies.

He said: “We have already had a really good take-up and people can see the advantages. It is a business decision whether it is cheaper to pay the one or two per cent and receive the money quickly.

We are getting money back into the local economy without an excessive burden on the taxpayer.”


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