Welsh SMEs Struggle With Late Payments as Labour Pushes for Fairer Business Practices

A Growing Challenge for Welsh Businesses

Small and medium-sized enterprises are the foundation of the Welsh economy, employing the majority of private-sector workers and driving local innovation. Yet new figures show that more than 61 per cent of invoices issued by Welsh SMEs between September 2024 and August 2025 were paid late.

This alarming statistic, reported by Business News Wales, highlights a worsening problem that affects cash flow, stability, and long-term growth for thousands of local businesses. For many, late payments mean delayed wages, halted investment, and increasing financial strain.

Labour’s Commitment to Fairness

Labour has long argued that small businesses deserve fairness and respect. When work is completed, payment should follow swiftly. The principle is simple, but it has too often been ignored by large corporations that use smaller suppliers as unofficial credit lines.

A Labour-led government has pledged to strengthen the Prompt Payment Code and introduce stricter rules to ensure large firms pay on time. These steps are designed to put small businesses first, making sure they can plan ahead with confidence and invest in growth rather than chasing overdue invoices.

The Wider Impact on Communities

Late payments don’t just hurt business owners. They affect workers, families, and entire communities. When a small builder or café struggles to get paid, it can mean cutting staff hours, delaying supplier payments, or taking out costly loans.

In Wales, where small enterprises are at the heart of many towns and villages, the impact can be particularly severe. These firms are not only economic drivers but social anchors, supporting local jobs and community life. Labour recognises that protecting SMEs means protecting the people and places that depend on them.

What Can Be Done Now

There are practical steps businesses can take — such as tightening payment terms, automating invoice reminders, and prioritising clients with good payment records. Yet no amount of internal efficiency can fix a system that tolerates chronic late payment from larger companies.

That’s why government leadership matters. Labour’s approach would combine fair regulation with practical support, including improved access to finance, better digital tools for cash-flow management, and faster dispute resolution when payments are delayed.

Building a Fairer Economy for Wales

For Labour, supporting SMEs is not just about economics. It is about fairness, dignity, and opportunity. Every business that delivers work on time deserves to be paid on time.

As the next UK budget approaches, Labour voices across Wales are calling for decisive action to strengthen small businesses, reduce red tape, and enforce fair payment practices. A thriving Wales depends on small firms being paid promptly and treated with the respect they earn every day.